India

Rs 18,782-crore hole stares at Suresh Prabhu

March 03, 2015 08:42 AM

In droll fashion, that was the rhetorical question Railway Minister Suresh Prabhu posed to himself and God, as he presented the first full railway budget of the National Democratic Alliance (NDA).

And well he might.

Prabhu's ministry intends to invest Rs 856,020 crore ($137 billion) over the next five years to revamp the world's most travelled railway network–and he intends to do this without any passenger-fare hikes.

For 2015-16, Prabhu intends to spend Rs 100,011 crore, an increase of 52% over the previous year.

Part of the money over this year and the next four, will come from the central government, which, on Thursday, announced Rs 40,000 crore annually as additional finance. The ministry also plans to borrow Rs 17,655 crore from the market, use Rs 17,793 crore from internal resources and get Rs 5,781 crore through private-public partnerships.

This leaves Prabhu with a Rs 18,782-crore hole for this year alone and a task on his hands : to cut costs, raise money and generate profits.

As a first measure to cut costs, Prabhu announced no new trains–the first for a railway minister after many years.

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