Railways said that to bring in private entities will create jobs and bring new technology.
Railway Board Chairperson VK Yadav on Wednesday said the decision of the Railways to bring in private entities to run 151 passenger trains will not result in any job losses but will increase employment opportunities, bring in new technology and also enable the national transporter to provide trains on demand.
The move by the Railways to privatise 151 trains on 109 routes has been criticised by opposition parties which have alleged that the poor people's lifeline was being taken away.
Allaying such fears, Mr Yadav said only 5 per cent of the trains are being given to private operators while 95 per cent of them will be run by the railways on the fare structure fixed by the national transporter.
"The railways at present operates over 2,800 mail/express trains in its network and the same will continue to be operated by the national transporter and the number will be increased as per demand," he told PTI.
"Keeping in mind the poor, the railways itself will fix the tariffs for these trains. The move will improve the availability of transportation services to the poor. By 2030, we will have 13 billion passengers. So as far as jobs are concerned, they will only increase in the Railways," Mr Yadav said.
He also said the decision was taken after keeping in mind the gap between the demand and supply of tickets. More than 50 million passengers were waitlisted for train travel in the previous financial year, Mr Yadav said, indicating the existing gap which is expected to widen in the coming years.
The fares that private train operators decide will weigh in factors including airfares that come in the same segment and also AC bus fares, and the charges will be fixed after comparing them, Mr Yadav said.
"I do not think that the fares fixed by private train operators will be too high, if they want to keep financial viability," he said.
Mr Yadav also said that over the last six years, railway infrastructure has been developed in such a way that in the next few years no passenger will be waitlisted.
He said that by December 2021, with the operationalisation of the Dedicated Freight Corridor and other infrastructure development, trains will be able to run at higher speeds.
"We will introduce new trains, we will generate more employment and let there be no doubt that private operations will not get any preferential treatment. We have a protocol in place and that will be followed," he said.
The chairperson said the bids have been designed in a way that the Railways will be able to recover the minimum guaranteed cost.
The Private Entity shall pay to Indian Railways fixed haulage charges, energy charges as per actual consumption and a share in Gross Revenue determined through a transparent bidding process. The Railways is expected to receive total haulage charges of around Rs 3,000 crore per annum from operation of these 151 trains.
He said the Rs 30,000 crore investment in the project will enable railways to spend its existing resources for accelerated development of railway infrastructure in the North Eastern region, other socially and economically backward regions and also upgrade its existing infrastructure for running more number of trains and at higher speeds.
"Right now we are making a loss in the passenger segment operation and basically we cross-subsidise with the freight segment. In this particular project, what we have devised is that railways is not going to lose anything and ultimately the minimum cost which the private operator is going to pay will be able to meet the expenditure of the railways and whatever revenue we get over and above will be profit for the Railways," he said.