System upgrade: ‘Railways suffered Rs56b losses in three years’

Officials insist that the department’s losses are because half of its engines have gone out of order in three years.

Zahid Gishkori July 25, 2011


Despite spending Rs6 billion on the maintenance of locomotives and coaches for upgrading its system, Pakistan Railways’ losses for the past year alone outstripped those of the previous three years (2008-2010) combined, officials said.

“The railways’ losses jumped to Rs56 billion, with the department suffering a loss of Rs25.6 billion just this year,” a senior official told The Express Tribune.

He said that the department had incurred losses of Rs31.7 billion in the period between 2008 and 2010. The mechanical wing of PR spent Rs1 billion on the repair and maintenance of locomotives to make the public sector organisation profitable during the previous fiscal year, federal Minister for Railways Ghulam Ahmad Bilour informed the National Assembly in a written reply.

“As much as Rs4.4 billion was spent on repairs and maintenance of locomotives over the past three years,” he explained.

The PR incurred losses of Rs5.4 billion in 2007-08, Rs18.7 billion in 2008-09 and Rs20.2 billion in 2009-10, Bilour said.

According to him, the railway administration spent Rs1.5 billion on the repair and maintenance of bogies (carriages) to revamp the old system during the last three years, he said in response to a query raised by Muhammad Riaz Malik.

An amount of Rs456 million was spent in 2008-09, Rs442 million in 2009-10 and Rs250 million in 2010-11 on maintenance, he added.

Pakistan Railways spokesperson, Saeed Akhtar said, the department “is facing acute financial problems” because of “non-provision of financial resources by the government”.

He said: “The reason behind the losses is that half of railways’ engines have gone out of order in three years.”

The Auditor-General of Pakistan’s annual report also showed that Pakistan Railways incurred losses of Rs5.6 billion on account of misuse of public funds, poor control of administration on its resources, etc during the last fiscal year.

Auditors found irregularities in Pakistan Railways use of natural gas, and said that it suffered a loss of Rs962 million because of unadjusted gas charges.

They also found that the railways incurred a loss of Rs755 million because of selling scrap at a lower rate and non-transparency in the tender process.

In one instance, the method adopted by the PR for evaluating bids caused a loss of $8.4 million, investigators revealed in their audit report.

The loss was due to “injudicious evaluation of tenders”, they added.

They also revealed PR was deprived potential earnings amounting to Rs480 million by not leasing their agricultural lands.

Published in The Express Tribune, July 25th,  2011.


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ziabacha | 9 years ago | Reply

If we look into history of Pakistan railways it is evident that PR is on speedy decay. Mr. Bilour who is the minister of Railways in Pakistan is adding a black chapter to this history. His business interests might be conflicting with those of PR and therefore, he would not like to improve this department. He even cant do it if he wishes to do so. He and his team is not competent to make PR working and earn something. Every day he is begging the government and even blackmailing the government to bail out PR. Instead of begging he should at least check the records of PR and stop taking bribes for postings and contracts. If he is not corrupt and involved in corrupt practices within PR, then he should come up with solution. We, the public of Pakistan, have to right to ask him regarding his contributions against the hefty perks and privileges he takes as Minister to the Government of Pakistan.

Mubeen | 9 years ago | Reply

This seems incorrect, Rs One Billion for repairs and Half a Billion for Boggies, still there is no improvement. I think money went somewhere else in name of repairs.

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