- Indian Railways get aggressive competition from Airways, as Airways to become popular mode of transportation in 2019-2020
- Augmenting the pricing and capacity can save the downfall of Indian Railways
- Indian Railways fares not as unfair as people make them out to be
New Delhi, August 03, 2017: Reportedly, the aviation sector is said to grow in 2019-2020 as the Indian Railways prices continue surging. Recently in a blueprint laid out by Indian Railway, it was mentioned that the number of passengers traveling by air would exceed AC-class passengers in 2019-20.
Indian railways and domestic airlines carried about 145 million and 97.8 million passengers respectively between December 2015 and November 2016. With a projected 20% growth in air passengers and 5% growth in rail AC-class passengers between December 2015-November 2016 and 2019-20, it is estimated that air passengers will outnumber rail AC-class passengers soon.
As the Indian railways surged the price on the base fares of Shatabdi, Rajdhani and Dhuranto trains last year giving leverage to the aviation sector. The base fare of these railways was raised on the basis of selling capacity as recommended on Railway Board formula, the base fares would increase by 10 per cent with every 10 per cent of train berths sold.
While the railway’s fares went remarkably high, Air India announced that the last minute fares won’t be raised making the last minute booking before take-offs at par with AC rail fare. All the airlines have followed similar fare patterns and therefore reducing airfares, the shift of 2AC and 1AC rail passengers to Airlines have increased remarkably since. Leading to this alarming state of affairs for Indian Railways, 3AC still remain unaffected because even the Tatkal bookings are lower than the last minute air fares.
The two factors by which Indian Railways can still gain traction and recovery by 2020 are through augmenting capacity and pricing. Although Indian railway has been leveraging its track capacity at a rate of 7km per day since 2015, it cannot be augmented to a level that can stop the growing aviation sector from mangling the rail AC passenger segment by 2019-20. Hence, Indian railways can hardly do anything till 2020 when both dedicated freight corridors are commissioned, relieving sizeable capacity for railways.
Pricing and travel time, are two most important factors that can affect the passenger segment of Indian railways. Talking about pricing, the railway pricing is not as simplistic as it is made out to be. The costing of air carriers are significantly more than 1AC/2AC rail and considering that more than half air tickets are sold within two weeks the departure, despite the flexi-rates, there is a huge difference between the railways and air fares. However, the air fare for tickets that were booked at least two weeks before the travel day may be in the range of 1AC/2AC rail fares. Taking the price factor in regard Indian Railways are doing well and should have no concerns on this front.
While travel time is of the essence to the passengers and not the authorities, and the only alternative to combat the huge difference of time saved in airlines compared to railways, should not be bullet trains. While major routes like Delhi-Bombay have access to electric tracks and serve under “A” category of railways, they still need to up the speed of express trains which run at the maximum speed of 160kmph/130kmph. The speed of these trains can be increased up to 110kmph which 80% of the maximum speed, there will be a lot of time that could be saved benefiting the 6PM-8AM trains which do not enter the slab of productive hours.
Indian railways can tweak their options to gain the leverage over the aviation sector, which is said to overtake in 2019-2020.
-Prepared by Nivedita Motwani. Twitter @Mind_Makeup
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