Pak Railways ready to take over Business Express

Train service is currently suspended as dues of private operator pile up.

LAHORE:

The management of Pakistan Railways is definitely in a position to run Business Express train if the private management fails to continue the service, initiated almost a year ago on the basis of public-private partnership, says a senior railway official.

“PR cannot afford closure of the service financially and economically,” he said but requested anonymity.

PR is already successfully operating Karakoram Express, which earns approximately Rs3 million daily.

The private operator of Business Express, which runs between Lahore and Karachi equipped with modern facilities, has to pay unpaid bills of Rs320 million to PR.

“Though PR authorities are under pressure to offer some concession, nobody can write off the outstanding amount as this will take him behind bars,” the official said.

On February 4, 2011, the PR and MS Four Brothers signed an agreement to operate 303-Up/304-Down Business Express between Lahore and Karachi as a public-private partnership with the private entity agreeing to pay to PR the equivalent of an 88% occupancy rate.

For the service, aimed at improving earnings of the troubled railways, the PR provided nine AC coaches, one luggage van, two power vans, one guard bogie and locomotives to the operator. Under the agreement, the operator had to pay Rs3.2 million to PR daily as occupancy charges.

Over time, the amount accumulated to Rs320 million because the company could not reach the expected occupancy level and sought a reduction. The Ministry of Railways approached the Economic Coordination Committee – the highest economic decision-making body of the country – for intervention as the operator failed to clear the dues and still wanted to continue the service.

Last week, the operator asked PR to suspend the service for three days starting January 26. “It seems that it will continue to remain suspended as the company has not come up with solid proposals to restart operation,” the railway official said.

He claimed that Four Brothers was seeking financial concessions and cooperation, but said it was beyond the jurisdiction of PR.

If Four Brothers failed to resume operation, the PR itself would start running the service with same travel standards and quality, he said. “PR cannot bear more losses because of suspension of a profit-making service,” he said.

Talking to The Express Tribune, Mian Shafqat Ali, partner in the Business Express venture, rejected the perception that the company had made a request for putting a halt to the operation.

“We asked PR authorities to first implement ECC’s decision on occupancy as the company will not be able to run the train until the directive is implemented,” Ali said.

PR had assured them that the decision would be implemented by February 2 and after that Business Express would run according to the schedule, he claimed.

Published in The Express Tribune, January 31^st, 2013.