With control over deficit, Pak Railways beats target

Improved balance sheet, increasing number of passengers

Shahram Haq August 07, 2015
Improved balance sheet, increasing number of passengers. PHOTO: ONLINE


After years of poor performance, Pakistan Railways (PR) has reduced its deficit to Rs27.25 billion for fiscal year 2014-15 and earned Rs31.92 billion against the target of Rs28 billion.

The cash-strapped railways has somehow managed to strengthen its fiscal position. “It has earned about Rs3.95 billion more than the target and managed to cut deficit by Rs5.32 billion by controlling expenses,” said Minister of Railways Khawaja Saad Rafique in a press briefing on Friday.

The reasons behind improvement in the balance sheet were better service delivery and higher number of passengers and freight trains. The number of passengers has improved significantly and over 10 million people travelled through the railways network in the past couple of years.

Read: Pakistan Railways prepares for tougher challenges ahead

“We know the importance of freight operation and without improving this area, we cannot steer the corporation out of the crisis. In the past two years, the number of freight trains has gone up from 182 to 2,920 annually, an increase of 1,504%,” Rafique said.

“The locomotive strength for freight operation has reached 80 compared to eight when I joined the office (in 2013).”

For the current fiscal year 2015-16, “we are setting a revenue target of Rs38 billion, despite the government’s advice, suggesting Rs32 billion,” he said. To achieve the target, Pakistan Railways is planning to step up initiatives in different areas.

The corporation’s management is conducting a survey of the railway land with the help of the urban unit of Punjab government. “Pakistan Railways is not aware of the exact area of land they own, though figures say we own 167,000 acres.”

However, Rafique added for a more accurate figure a land record management information system survey needed to be conducted.

“Pakistan Railways is likely to see a whopping addition of thousands of acres after the survey,” he said, adding except for Sindh, all other provinces were cooperating with them.

Initiatives taken

Rafique said the railways under a new land lease policy was offering mid-term lease instead of 99 years of lease. “In two years, we have earned over Rs3 billion whereas in the previous five years (2008-13), the railways earned only Rs2.4 billion from land lease,” he said.

The successful Green Line train venture has encouraged the management to initiate more such ventures. In addition to this, the railways management is planning to outsource loss-making train routes to minimise the burden.

“Despite having unpleasant experience of the public-private partnership, we will go for the same ventures as early as this year,” Rafique said, adding the railways would also start new train services on the model of Green Line for the economy-class passengers too.

“Only the trains with improved standards and value addition to the services will be considered for fare hikes.”

Rafique said Karachi and Lahore stations had been included in the China-Pakistan Economic Corridor project and they would be upgraded. Pakistan was at a perfect geographical location and could serve as a regional corridor if only its infrastructure was improved, he remarked.

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According to Rafique, the Main Line-1 project has been extended up to Landikotal from where it will be linked to Jalalabad (Afghanistan). In addition to this, work on linking Quetta-Gwadar-Jacobabad via railway line will be started from next year.

Published in The Express Tribune, August 8th,  2015.

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Faruk | 5 years ago | Reply @Ali: Saad Rafique has done ok by looking, he had no experience about running railway, and education background, now days railway is only successful when you have Doubel or duel tracks. On busy main line Karachi- Lahore- Peshawar you should have TWO duel tracks one for fast Trains with fewer stops and 2nd one also fast but train stops at most stations. When you look at population of Pakistan we need good railway network and all railway lines should be double. With new technology it's very easy to lay new tracks and it's cheaper than making a new road.
S.R.H. Hashmi | 6 years ago | Reply We were told in the television news around Eid time that a train left Lahore for Karachi with seven passengers on board. Of course, that historic incident is not mentioned in the report. The report says that the railways management is planning to outsource loss-making train routes to minimize the burden. Now, that sounds strange. If the routes are really loss-making, with no possibility of improvement, why would the private sector be interested in taking them over, unless of course it sees a strong possibility of turning it into a profit-making route. And if the private sector can see a possibility of turning it into a profitable route, then why can’t the experienced railways management, with a supposedly capable Minister looking after it, do the same. The Railways Minister should also realize that the government railway is a service providing institution and not a private enterprise, with profit maximization as its only objective. As such, it should be prepared to run trains on some loss-making routes as well in order to provide service to far-flung areas. Such loss-making routes could be subsidized by other profit-making routes, thus leaving the railways in a net profit or lower loss situation. In a mad rush to show fantastic results, the management should not ignore this service-providing function of the railways. Karachi
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