Home / News / India /  Railway board says operating ratio likely to improve to 96.96% by end of current financial year

The railways operating ratio is expected to improve to 96.96% by the end of the current financial year despite coronavirus-related disruptions, said Railway Board member Naresh Salecha on Monday.

Salecha added that the operating ratio was pegged at 96.15% for 2020-21.

"This is lower than the revised estimate of 98.36% for 2019-20. A lower operating ratio can be attributed to lower expenditure on account of a fall in working expenses as well as a sharp decline in pension liabilities," he said.

Also Read | How India can fight vaccine hesitancy

"Pension liability was budgeted at 53,160 crore in the beginning of the current fiscal. However, the revised estimate stood at 523 crore as the national transporter made an arrangement with the finance ministry to defer this expense," he added.

The Railway Board member noted that 2020 was an “extraordinary" and “exceptional" year due to coronavirus pandemic as a result of which passenger trains did not run.

"Our projections hence went haywire. Before this, we have been taking full pension liabilities. When we could not meet such liabilities, we came to an arrangement with the finance ministry so that a separate fund could be given to us, which we have to repay to the ministry. In a couple of years, we have to pay it back," he said.

What is operating ratio?

The operating ratio means expenses as a portion of revenue or the amount spent on every rupee earned.

Normalising services

Meanwhile, Railway Board chairman Suneet Sharma said on Monday that the Indian Railways is taking to steps to normalise the service.

"We have resumed 65% of mail express services. We are trying to normalise the services & talk with state governments, keeping Covid-19 protocols in mind," said Sharma.

Highest capital expenditure

Indian Railways now has the highest ever total planned capital expenditure of Rs. 2,15,058 crore this year with 7,500 crore from internal resources, 1,00,258 crore from extra-budgetary resources and 1,07,100 crore for capital expenditure in the General Budget.

In a press release, the Ministry of Railways on Monday stated, "Indian Railways received a record outlay of 1,10,055 crore, of which 1,07,100 crore is for capital expenditure in the Union Budget 2021-22 presented in the Parliament today."

The Gross Budgetary allocation is Rs. 37,050 crores (53 per cent) higher than the previous budget of 2020-21. In spite of the Covid-19 pandemic, this is a remarkable vindication of the progress being made being undertaken infrastructure projects in Indian Railways.

With inputs from agencies.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our App Now!!

Edit Profile
My ReadsRedeem a Gift CardLogout