Parliamentary committee hearing: Railways revenues to decline by 33%

Despite bailouts, the ailing company continues to bleed money.

Qamar Zaman August 23, 2011


Despite having begged for tens of billions of rupees in bailouts for several years in a row, Pakistan Railways is expected to see it revenues decline by 33% in the current financial year, compared to last year, leading to the need for yet more government bailouts to the ailing transport company.

Testifying before the railways committee of the National Assembly, Railway Secretary Javed Iqbal admitted that the state-owned train operator was facing one of the worst financial crises in its history, mostly due to rampant corruption and mismanagement.

The committee meeting was chaired by Sardar Ayaz Sadiq, a member of the Pakistan Muslim League Nawaz (PML-N) elected from Lahore.

Officials said that Pakistan Railways was expected to earn Rs12 billion in revenues over the financial year ending June 30, 2012 compared to Rs18 billion the previous year.

Among the problems highlighted by Iqbal were embezzlement of railway funds, auctioning scrap at throwaway prices, purchasing spare parts at exorbitant (above market) rates and a failure to collect outstanding dues from some of its biggest customers, both public and private.

Yet one of the biggest problems being faced by the railways is the lack of functional locomotives. Of the 529 locomotives owned by Pakistan Railways, only about 50 are currently operational.

Railways officials told the committee that, in December 2010, the Executive Committee of the National Economic Council (ECNEC) had approved spending Rs55 billion to procure 150 locomotives. It is unclear if any of the older locomotives were going to be repaired.

In order to ensure a transparent bidding process, the committee recommended a third party evaluation process before and after the bidding. A five-member committee comprising railways officials was constituted to conduct this process.

The committee has also been assigned to compile a detailed report regarding number of locomotives repaired, their status and performance, and spare parts imported over the last three years for these locomotives. The body would submit the report to the NA committee in 15 days.

Published in The Express Tribune, August 23rd, 2011.


Vicram Singh | 12 years ago | Reply

India could extend the railways infrastructure through Afghanistan to Central Asia. India will import fuel and export finished engineering goods, services.

syed | 12 years ago | Reply

Fire the ineffecient and incompetant railway minister .Hire advisors from Railway Board -India or out source railways .

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