Pakistan Railways: Crisis sets in deep as govt struggles to pay

Rail workers protest at the Cantt station in Karachi, stranding hundreds of passengers bound for Faisalabad and Peshawar. PHOTO: MOHAMMAD AZEEM/EXPRESS

ISLAMABAD: With train operations coming to a halt across the country on Monday, a high level meeting was summoned to find a way out of the deepening crisis that has pushed Pakistan Railways (PR) to the brink.

But the outcome of the meeting, summoned by President Asif Ali Zardari, was far from definite – with the president directing that funds for the payment of salaries and pensions of protesting workers be arranged for in 7 days.

On the other hand, the government once again asked PR to approach banks for a Rs6 billion loan to cater to burgeoning infrastructural costs – funds that the president ordered be injected solely into a dilapidated and fast deteriorating system.

Finance ministry refuses to pay

Earlier this year, Prime Minister Yousaf Raza Gilani approved Rs11.5 billion as a bailout package for Pakistan Railways. Of this amount, around Rs5 billion was to be paid by the federal government as cost for rehabilitation projects, while PR was asked to arrange the remaining amount through commercial banks.

However, the finance ministry refused to grant Rs5 billion saying it could not provide further subsidies to Pakistan Railways seeing as it is already suffering huge losses.

President Zardari has asked the government to release funds within seven days for the payment of salaries and pensions of protesting railway employees, a press statement issued after the meeting stated.

(Read: The state of Pakistan Railways)

Role of the private sector

Presidential spokesperson President Farhatullah Babar said that private sector entrepreneurs were also invited to the meeting to discuss a public-private partnership model for revamping railways.

Chairman Arif Habib Group of Companies Arif Habib and Chairman ARD Group of Companies Aqeel Karim Dhedi were specially invited to give their input on the role the private sector could play in turning around the state-run rail sector, Babar added.

Revamping railways

“The president also advised the government to arrange a loan of Rs6 billion for locomotive repairs and purchases of new locomotives. The loan will be used exclusively for this purpose and will not be diverted for any other purpose,” he said.

The spokesperson further said that another decision was taken during the meeting which pertained to the over Rs40 billion outstanding overdraft obtained from the State Bank by Pakistan Railways, for which it has been paying an amount of Rs350 million per month.

(Read: Railways eye bailout funds by August)

The president advised that this matter be taken up with the Council of Common Interests as PR services were utilised by all provinces and the issue was inter-provincial in nature.

Railways Minister Haji Ghulam Ahmed Bilour informed the meeting that half of the total locomotives were out of order, 86 per cent of bridges are more than 100 years old, the signaling system is obsolete, the telecommunication system is outdated and the track is over-aged.

Protests in Sindh

Rail traffic between Sindh and Punjab remained suspended due to protests by staff at the railway track near Loco Shed Rohri on Monday.

Hundreds of railway employees, under the aegis of the Loco Running Staff Train Drivers Association led by General Secretary Ali Haider Chachar, staged a protest demonstration against the non-payment of salaries.

Protesting employees staged a sit-in on the railway track, making it impossible for trains to get out of the shed.

“Our protest and sit-in will continue till the disbursement of salaries,” Chachar told The Express Tribune.

Protests in Lahore

Locomotive shed workers of Lahore observed a strike in the diesel loco shed for almost 11 hours on Monday. Hundreds of workers of Rail Mazdoor Ittehad (RMI) started their protest early Monday morning against the non-payment of salaries.

The employees threatened to resume the protest early Tuesday morning and would continue till they were paid.

(ADDITIONAL REPORTING BY SARFARAZ MEMON IN SUKKUR AND SHAHRAM HAQ IN LAHORE)

Published in The Express Tribune, October 18^th, 2011.