The Railway Budget 2015 got mixed response from India Inc. While it is largely well received and termed ‘pragmatic’ and ‘forward looking’, the freight hike got thumbs down.
“It is a forward-looking, pragmatic and strategy-oriented Budget with an innovative approach…the proposed measures and initiatives, if executed and implemented effectively, will go a long way to restore the prime place for railways in our national economy,” FICCI Secretary-General A. Didar Singh said.
The move to mobilise investment of Rs.8.50 lakh crore in the next five years for the railways from sources such as multilateral development banks and pension funds was appreciated.
“The road map laid for attracting private investment for the sector through tapping low cost long-term funds from insurance and pension funds, multi-lateral and bilateral agencies; forming JVs with IRFC or existing NBFC of a PSU; creating new vehicles like a holding company to raise long-term debt to induce investment will go a long way in boosting the cash strapped sector and facilitate completion of many crucial rail projects,” said Godrej Group Chairman Adi Godrej. Meanwhile, Ravi Uppal, MD & Group CEO, JSPL, said, “The budget lacks in fine detail but promises a superior ride to everyone from passengers to private participants… On the downside the 6.30 per cent hike in freight rates for coal will dent a range of industries and is also out of whack with the 'Make in India' spirit. Along with the 0.8 per cent hike in steel freight this is a double whammy that could have been avoided.”
‘Make in India’ thrustIndrani Dutta writes:
The Bengal Chamber hailed the Budget for not making any unrealistic promises in terms of new projects and new trains, focusing instead on efficiency, modernisation and safety.
The Indian Chamber of Commerce said the budget laid the road map for attracting private investment in the railways while focussing on passenger amenities, timely project completion and infrastructure expansion. The EEPC, a body of engineering exporters, however, gave a cautious welcome to the budget saying that although the Budget does remove many bottlenecks, the increase in freight rates on items like cement and steel will add to production costs.
The Bharat Chamber of Commerce said there was special focus on macro goals to make the Indian Railways, a real engine of growth for the country.
Striking a contrarian note, the Merchants Chamber of Commerce said the hike in freight charges “will adversely impact the country’s industrial projects.”
It also rued the lack of clarity on steps to complete ‘work-in-progress’.
The Coal Consumers Association felt that the increase in hike in coal freight would translate into a 2.5 to 3 per cent increase in cost of coal at the consumers’ end. A common refrain was the issue of raising funds with Hemant Kanoria, CMD of Srei Infrastructure Finance, saying that it is an ambitious budget, whose success depends on mobilisation of funds.
