LAHORE: After sustaining profitability for three and a half decades, Pakistan Railways Advisory and Consultancy Services (Pracs) registered an annual loss of Rs11 million primarily due to the insolvent condition of its parent – Pakistan Railways (PR).
Pracs, which manages PR’s financial activities through commercial and consultancy projects, has been affected to a great extent due to trains being inactive. The main source of income of the ancillary is the commercial management of PR’s passenger trains. Currently, Pracs is active in the commercial management of only the Hazara Express, from which it is earning Rs10 million annually. The other service, Rohi Express is currently suspended on the orders of the railways administration due to lack of locomotives.
The number of booking centres has also been reduced to 20 from 27 all over Pakistan due to the PR’s bad health. Pracs received Rs1.6 million monthly merely from the reservation office in Lahore city railways station when 340 trains were operational, presently the figure has dipped below Rs0.4 million as most of the coach services are suspended.
This is the first time that Pracs is in loss, which created panic among the employees, said Pracs Assistant Director Commercialisation Khalid Bashir, while talking to The Express Tribune. “This is mainly due to the lower number of projects that we are executing currently,” he added.
“We are directly linked with the condition of PR. Despite the downfall of the national rail, Pracs managed to remain in profit throughout its history; however the bad situation of railways has now started to haunt us,” Bashir said. He, however, added that Pracs has already started to implement precautionary measures like curtailing its expenses and working to obtain new projects such as the commercial contracts of Rail Cars and Karachi Express.
PR was earning Rs88.1 million annually, a handsome profit, only from the commercialisation of 3 trains ration against the contracts given to Pracs despite the 60% profit which Pracs achieved as per agreement. The amount which railways were getting at present from Pracs stood at Rs200 million, as only a single service is operational.
Previously, Pracs was also offering catering services in eight express trains and earning Rs27 million annually of which 95% was transferred to PR’s account as per agreement, that contract was not in service due to the railways condition.
Pracs is also bearing the expenses of 20 retired railway officials hired specifically for the project of rehabilitating 96 locomotives, however till date no work in this regard has been initiated and the officers are just enjoying luxury pays and perks. The management considered these officers a big burden on the organisation and considers them as one of the reasons for the loss for the financial year 2011-2012.
The consultant has assets of Rs400 million deposited in different banks as strategic reserves. “We have managed to overcome our losses via utilising our reserves,” Bashir said. Pracs has 800 employees, and if situation persists then it will be hard to handle the financial affairs of the organisation as the only revenue drivers for Pracs is the execution of projects which are at a record low, he added.
Published in The Express Tribune, September 1st, 2012.