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Jun 13, 2006

Do U Know - Laloo Yadav & Railways

Remember the old joke on how Pakistan would stop fighting for Kashmir, if there was a condition that it would have to take Bihar with Kashmir? We may have to rewrite it.

In 2001 the Rakesh Mohan Committee that had looked into the restructuring of the railways, pronounced the organisation to be in a terminal debt trap, with a liability of Rs 61,000 crore to the government. The panel had even predicted "fatal bankruptcy" if the railways did not privatise. And one of its committee members, IIM’s Professor G. Raghuram, now, is all praises for Laloo.The railways under Laloo has shown additional earnings of Rs 15,000 crore in 2005-06. In the process, it has become the second largest PSU profit-earner after ONGC. IIM Ahmedabad, recognised his turnaround of Indian railways, and made it a case study for its students.

What did the minister do? Thats the Do U Know question this week.

Refused to hike fares. Shored up earnings by carrying more passengers and freight.
Increased the load carried by a goods wagon from 81 tonnes to 90 tonnes. This gave an additional earning of Rs 7,200 crore.
Upgraded tickets if seats were going vacant in the upper class. So, waitlisted passengers could be allotted seats.
Maintained passenger profile so that bogies could be taken off or added to trains according to seasonal demand.

Source .Max and Whiskeypriest got it right.

Search Engines Allowed. Answer on Thursday.

Previous Do U Knows


  1. well, there were quite a few of his bungling, before he started setting things right.

    The kulhad thing, for example, or banning soft drinks on the railways.

    Some of the changes are good, some can quite easily be attributed to a booming economy.

    I've long believed that the man could do right if he was convinced enough that it would help him retain power. Glad to see it finally thru.

  2. bangaloreguy, i am talking about some policy changes that he made..

    on doing right, well others before him thought the best way to retain power would be to introduce more trains to their region or some populist move. how many of his voters are goin to care if Railways is profitable?

    Lets give credit when its due..and its amazing that he could come up with stuff, which others couldnt come up with..

    and its amazing when the "solution" few years back seemed to be just privatise..

  3. His biggest achievement has been to be honest enough to admit (to himself) that the railway officials/ bureuacrats surrounding knew better than him. On the policy level, he realized that the competition to railways was from the no frills airlines & the road freight transport. So he has
    1. increased capacity utilization in upper classes by reducing fares
    2. increased capacity utilization by upgrading 2nd class passengers to upper class
    3. reduced freight costs and instead went in for low cost large volume game thro' bulk discounts

    Another 'master stroke' which has largely gone unnoticed (and thereby unprotested) is the removal of telescopic fares i.e. fare from Mumbai to Lucknow via Delhi will now be equal to fare from Mumbai to Delhi plus from Delhi to Lucknow.

  4. hi whiskeypriest, didnt know about the "masterstroke"..
    isnt it unfair?

  5. well, lalu has certainly proved that he can turn around sick units...

    the fact that he did nothing with a sick state is, well, a story of the past now.

    Though indian railways has still many milestones to achieve, for me as a regular traveller the most important thing is the introduction of convenient to book and use.

    oh, and telescopic fares have been reinstated. They were off for some time, but they are back now.

  6. On "privatising the railways" - I have long believed its not workable - as other countries' experience shows(had written on it somwhere, dont quite remember where). I'm more for corporatising the PSUs than just screaming "privatisation" - which's again a dogma anyhow.

  7. @$#!$# well from enduser point of view, eticket is great..even though i havent used it yet..

    bangaloreguy, even though i dont know all the details, i agree with u:d

  8. wow! eye opener.? what about if we later on got to know that he did some scandal in railways?

  9. nishu we wont be suprised then:D
    just because he turned around the railways doesnt mean he wasnt corrupt earlier or that he will never ever be corrupt..but just that sometimes media builds sterotypes..

  10. Lalu is a great politician he knows very well what have to be done to remain in the power and in the limelight. Of course he has taken many decisions and initiatives which led to this success.
    But in spite of all the success passengers are still have to be fall on the trap of corruption of TT and railway police while having their journey.


    he might not actually be so smart...go thru dat pg..
    2 me lalu remains a quibbling pain in d ass...


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