Railway fare hike inevitable - Dept. sources

by Anura Maitipe

The Railway Department will increase train fares to offset an annual loss of Rs. 3,981 million as a result of the soaring world oil prices and an accumulated loss for the past three decades, a spokesman for the Railway Department told the Sunday Observer.

The annual loss the Railway Department has been increasing for the past three decades. In 1997 the loss stood at Rs. 712 million and today it has increased to Rs. 3,981 million, he said.

The soaring oil price and long accumulated debt payable by the Railway Department are the main reasons for the loss. Loans have been taken to purchase locomotives and compartments, he said.

The Railway Department has placed an order to purchase locomotives and rail compartments worth over Rs. 3 billion in 2006. The loan will have to be settled within a 20-year period. We have no alternative other than to increase the train fares to reduce the Railway Department's loss, he said.

A special committee has been set up to prepare a new train fare formula which will not burden the railway commuters. With the submission of the committee report the ministry will announce the new fare hike and the effective date, he said.