Indian Railways will borrow less at Rs. 11,790 crore from market through its two companies IRFC and Rail Vikas Nigam Ltd for capital expenditure during 2014-15.

The estimated market borrowing by these two companies during current fiscal were pegged at Rs. 13,800 crore from markets, as per the interim Railway Budget for 2014-15 tabled in February.

Thus, there has been downward revision in the market borrowing plan by Rs. 2,010 crore for the current fiscal.

“As I have increased internal resource component of Plan, I propose to scale down market borrowings... to Rs. 11,790 crore,” Railways Minister D.V. Sadananda Gowda said in his proposals while presenting the Rail Budget on Tuesday.

Resources from PPP are kept at the interim (budget) level, he said.

Indian Railways Finance Corporation (IRFC) will raise Rs. 11,500 crore in 2014-15 for investment in rolling stock and projects, the Railway Budget document tabled in Parliament said.

Besides, the other financial firm under Indian Railway, Rail Vikas Nigam Ltd (RVNL), plans to raise Rs. 290 crore through market borrowing.

During 2013-14, IRFC raised Rs. 14,688 crore while RVNL mopped up Rs. 254 crore from the market.

Besides, Railways expects to mobilise Rs. 6,005 crore through the Public Private Partnership (PPP) route during 2014-15.

Highest-ever outlay

The Government on Tuesday proposed “highest-ever” plan outlay of Rs. 65,445 crore to the railways for the current fiscal, with a budgetary support of over Rs. 30,000 crore.

Mr. Gowda said the “highest-ever plan outlay” would include market borrowing of Rs. 11,790 crore and internal resources of Rs. 15,350 crore.

Another Rs 6,005 crore would be mopped up through public private partnerships (PPP) mode, while railways would create a safety fund of Rs. 2,200 crore.

As per Budget Estimates for 2014-15, total receipts are projected at Rs. 1,64,374 crore, while total expenditure at Rs. 1,49,176 crore.

Operating ratio would be 92.5 per cent, which is an improvement of 1 per cent over the last fiscal.

While passenger traffic grew by 2 per cent, passenger earnings stood at Rs. 44,645 crore after revenue foregone of Rs. 610 crore on account of rollback in monthly season ticket fares, Mr. Gowda said, adding freight earnings are estimated at Rs. 1,05,770 crore for this fiscal.

The expenditure on pension is pegged at Rs. 28,850 crore, while Rs. 9,135 crore would be spent on dividend payment.

On the challenges facing railways, Mr. Gowda said, “Surplus revenues are declining. There is hardly any adequate resources for development works.”

The surplus resources, which stood at Rs. 11,754 crore in 2007-08, is estimated to be only Rs. 602 crore in the current financial year, he added.

He also said Rs. 5 lakh crore was required to complete the ongoing projects alone as only 317 of the 674 projects sanctioned in last three decades could be completed.

Completing the unfinished projects would require Rs. 1,82,000 crore, he said.

Observing that most of gross traffic receipts was spent on fuel, salary and pension, track and coach maintenance and on safety works, Mr. Gowda said that Rs. 1,39,558 crore was the gross traffic receipts and total working expenses were at Rs. 1,30,321 crore last year.