With this, we bring our live coverage for the Railway Budget to a close. The Railways performance has been under-whelming this year, which isn't surprising given the weakness in the economy and because the transporter has been in a long-drawn survival crisis.
It's going to get worse next fiscal with expenditure expected to surge thanks to the rollout of the 7th Pay Commission.
But Prabhu appears to have a vision: he intends to cover each of the problem areas, from improving service standards to making investments on both the freight and passenger side for the future.
Experts say the Railways has no money to fund any expansion and PPP is yet to take off in a big way.
By next year, the government will have completed more than half its term and so, whatever plan the minister has to implement, he has to do it now.
All of which will boil down to whether he can raise money from off-Budget exercises.
Will he able to do it, only time will tell.
Meanwhile, the Railways has put together a compilation of key highlights of the Budget. Check it out here .
With gross budgetary support at Rs 40,000 crore and capex at about Rs 1.2 lakh crore, where will Prabhu get the money from?
"Getting money from PPP has always been under-whelming," says Sachin Bhanushali, CEO, Gateway Rail Freight. "But the focus on improving freight market share will help."
1.15 pm: Reactings coming in now:
Umesh Chowdhary, VC & MD, Titagarh Wagons:
"While the numbers may have been weak, the vision is comprehensive. The Minister has tackled every issue: restructuring, freight corridor; improving container operations."1.11 pm:
The market is disappointed, as weakness in revenue growth (5 percent in FY16) has been accompanied by lack of any major announcements. The Nifty, down 0.6 percent, is perched at its 52-week low of 6,976.
1.10 pm: "We had set out on a journey of transforming Railways last year. Even as it continues, I am reminded of Gautam Buddha who said you make two mistakes: not starting and not going all way."
"We have started. We will go all the way."
"With this, I end the Railway Budget speech."
1.06 pm: Announcements on Railway-level reforms under way now:
Prabhu says we will explore creating a holding company for all rail companies. "Companies owned by the Railways hold a lot of potential, to be properly monitored," he says.
"Draft bill on rail development authority will be be ready soon."
"Radio stations will provide train-borne entertainment through PA system."
Railway Ministry tweets:
1.00 pm: More announcements:
"Will inaugurate India's first rail auto hub in Chennai."
"Working with insurance companies to offer optional TRAVEL INSURANCE at time of rail booking."
"To expand waste segregation and recycling centres."
"Will appoint key customer managers to liaison with majjor freight stakeholders."
12.59 pm: "We are working towards achieving the financial closure and early award tenders for 2 elevated suburban corridors between Churchgate-Virar and CSTM-Panvel in Mumbai."
Prabhu now starts outlining his plan on what he will do to win back share in the freight movement market.
The market, looking for big ticket ideas, is unmoved:
12.51 pm: Here's the kicker: "We will introduce 33 percent sub-quota for women in each reserved categories."
"Will install CCTV cameras on Tatkaal windows," says Prabhu.
"Will expand waste segregation and recycling centres."
"Children's food menu and services for senior citizens."
"20,000 display screens across 2000 stations to disseminate information."
The Minister is on a roll, announcing a slew of small but important services that will change the customer experience on Indian Railways, if executed well.
12.45 pm: "Will facilitate cancellation through 139 helpline post OTP verification to improve tatkaal services."
Railways will roll out a 'Clean my Coach' SMS service on pan-India basis.
12.39 pm: Railway Minister announces a number of novel trains: a semi hig-speed train named Tejas (above 130kmh), fully AC Humsafar Express, two to four Deen Dayalu coaches for unserved travel with potable drinking water and more mobile charging points and Antyodatya Express, a long-distance, fully-unserved superfast train service.
"Annualized savings of Rs 3000 crore to be achieved in FY17, a year earlier than announced."
"In 2015-16, we have closed 350 level crossings and eliminated 1,000 unmanned level crossings. 820 ROB/RUB have been completed in the current year and working is going on in 1350 of them."
12.32 pm: The Direct Freight Corridor project is gaining momentum. We propose to set up three freight corridors, says Prabhu. It is not clear if this means three fresh corridors or includes the two existing under-construction (East and West) corridors.
Indian Railways will surpass its ambitious target of commissioning 2500 kms of broad gauge lines, almost 30 percent higher than last year.
Prabhu is now discussing a number of passenger initiatives that Railways have undertaken this year: 1,780 automatic ticket vending machines, a live hotline for queries, 17,000 bio-toilets in 475 trains, wi-fi services at a number of stations.
Prime Minister Narendra Modi listens keenly to the Budget speech.
Not much movement seen in Railway stocks. Some emphasis on high speed rail means coach builders such as Siemens are seeing some action.
The fall in the benchmark indexes seems to be worsening.
12.20 pm: The Railways is targetting FY17 gross revenue target of Rs 1.84 lakh crore, up 10 percent year-on-year. Of this, freight revenue is likely to be Rs 1.18 lakh crore. Passenger revenue target is at Rs 51012 crore, up 12.4 percent.
Slew of announcements coming in:
- Healthy improvement in allocation seen towards DFC.
- LIC has agreed to fund Rs 1.5 lakh crore over next five years on very favourable terms.
Through novel measures, Railways has achieved savings of Rs 8,720 crore this year. This will make up for any revenue shortfall it will incur.
Here's the key number. The Railways is expected to meet an operating ratio of 90 percent this fiscal (as opposed to a target of 89 percent laid out in the Budget last year).For the next Budget, Prabhu says he is targeting an operating ratio of 92 percent.
The rise is because increased expenditure on account of the Pay Commission.
The operating ratio denotes expenditure incurred for revenue earned. Thus, a ratio of 92 percent means the Railway will spend Rs 92 to earn Rs 100. Lower the better.
"For far too long, we have relied upon freight fare hikes to raise revenues. I want to change this."
"This is the Budget that reflects the aspirations of the common man. But we are faced with two headwinds: international slowdown and the looming impact of the 7th Pay Commission," he says.
12.02 pm: Suresh Prabhu's Railway Budget speech has started.
Starts off with a few anecdotes about changes he has been witnessing in the Railways culture, salutes the spirit of Railway employees.
A word on the market: shares have turned a bit lower after straddling the flat line for most part of the day. Global markets, as has been the case for most part of the past many months, too are not supportive.
The speech should start any moment now. For investors, head here
to know which stocks will likely be in focus today.
Minutes to go, will Prabhu be able to do the near-impossible? That is, please all the important stakeholders: passengers, employees, analysts and the government babus.
Remember, a passenger fare hike will be unpopular while freight rates, the traditional go-to resource for Railways, has met with the law of elasticity long back -- you can't hike freight rates and not expect demand to fall.
(Railways' freight movement market share has fallen from 80 percent many decades ago to the 30s now, with roadways taking up most of it.)
Then there is the bullet train (high-speed train, according to some), a pet dream of Prime Minister Modi, but that is expected to be almost entirely funded through foreign and private investment.
Among the most important tasks for the Railway Minister are to augment revenues, improve service and safety standards, speed up the direct freight corridor (that will separate passenger and freight train lines on two key routes) and take measures to speed up movement on lines.
A few minutes ago, Prabhu was seen walking into the railway ministry, holding the iconic Budget briefcase, along with junior minister Manoj Sinha.
The speech should commence in about 15 minutes now.
A chartered accountant by education, Prabhu had earned a name for himself when he was Power Minister during Vajpayee's government where he brought about a number of important reforms. After the fall of NDA 1, he walked away from public life following a falling-out with his then party, Shiv Sena.
Last year, Prabhu, who was hand-picked out of obscurity by the Prime Minister to helm the Railways portfolio, had outlined an aggressive plan to infuse an investment of Rs 8.5 lakh crore into the Budget over the four years (2015-19).
Last year, he announced capital expenditure of about Rs 1 lakh crore. This year, he is expected to up the figure by at least 20-25 percent.
If you want to get up to speed on what the most important numbers are in the Railway Budget, head here
Welcome to the rolling coverage of the Railway Budget 2016-17. The second full Budget that Railway Minister Suresh Prabhu will present.
The Budget comes at a crucial juncture, with the economy still exhibiting weakness (never mind the GDP numbers), which means lesser goods transportation -- the money-spinner for Railways -- and with the government's fiscal situation too not being very helpful.
Starved of resources, Prabhu has had to look beyond the government to crank up investment to make some much-needed improvement to the way the national transporter is run, something that has been ignored for years, even decades.
But even as Prabhu has undertaken some important steps to improve Railways' financial position, such as doing away with coverage and looking to monetise various assets, unsurprisingly they have come at the cost of some resentment among the masses.
With the Narendra Modi government's political capital appearing to dwindle fast, Prabhu does not have too much time. And while he has brought about a number of important reforms, such as streamlining the powerful Railway Board or appointing Ratan Tata to head an important innovation council, the results will likely take some time showing up.
With that, stay hooked to our on-the-fly coverage of Railway Budget 2016.