Restructuring of Indian Railways into Smaller Zones — An Appraisal

(Submitted by a leading comrade of the All India Railway Party Branch)

A great debate on the railway bifurcation issue has been raging throughout the country. However, in the whole debate the right angle to gauge the problems related to it internally and externally is missing. We are missing the wood for the tree and the core issue has been derailed by Samata’s populism as well as Mamata’s regionalism.

Internal crisis and challenges ahead

In the recent years, the share of service sector in the GDP is growing while that of agriculture and manufacturing is declining. This has an adverse effect on the railway resources. In Indian Railways (IR) 89% of the freight traffic is contributed by eight major commodities, viz., coal, fertilizer, cement, petroleum products, food grains, finished steel, iron ore and raw material to steel plants which constitute the core sector of the economy.

Over the years there has been considerable decline in the Railways’ share of transfers in the cases of cement, petroleum and iron and steel mainly on account of the Railways’ competitive weakness in the face of challenges from other modes of transport, viz., road, pipeline, coastal shipping etc. The change in the profile of the economy has also contributed to the decline in the Railways’ share of the transport market. In the year 2002-2003, coal traffic is likely to come down heavily due to the closure of 22 Coalfields of ECL and decline in productions at Korba and Talcher Coalfields. In the years to come the IR is bound to lose traffic to road transport once the proposal for the golden quadrilateral national highway connecting the four metros comes into being.

To make matters worse, while the plan outlay for the transport sector as a whole has been increasing, the Railways’ share as a percentage of total plan outlay and also as a percentage of outlay for the transport sector has declined. This will be evident from the Table-I below:

Table 1
Plan outlay for transport sector and Railways
Plan period upto
Total outlay (in cr. Rs.)
Transport sector (in cr. Rs.)
Rlys. sector (in cr. Rs.)
Transport outlay as % of total plan outlay
Rlys. outlay as % of total plan outlay
Rly.outlay as %  of transport sector outlay


Social service obligations

At the dictates of the World Bank the Government has been consistently reducing budgetary support from 75% of plan size in the 5th plan period to 23% during the 9th plan period. The IR is not compensated for the social service obligations it discharges. It has been estimated that social service burden to the organization amounted to about Rs.3282 crores in 2000-2001. The main components of losses are: (i) essential commodities carried below cost, (ii) suburban services and some other coaching services, (iii) operation of uneconomic branch lines (iv) new lines completed with negative rates of return. But unlike IR all other railways in Europe and Asia receive subsidy from their respective governments on this account. Even after privatization of the British Railways the Govt. of Great Britain had to pay subsidy to the private operators in the interest of the traveling public.

Financial health of Indian Railways

IR plans are financed through (i) internal resources (ii) market borrowings and (iii) budgetary support. As the support from the general exchequer has declined, the level of market borrowing has increased sharply. Financial condition of IR is so bad that pension fund and the depreciations reserve fund of about Rs.4000 crores has been spent to defray normal cost. IR today have no reserves to fall back upon.

IR immediately need at least Rs.75,000 crores for replacement of over-aged assets and to complete the ongoing projects in different regions of the country like new line, doubling, electrification etc.

Crumbling infrastructure

The arrears in track renewal at the beginning of the eighth plan, which were about 9595 KM. have further gone up to about 10957 kilometers broad gauge (BG) by the end of the plan, apart from as many as 874 over-aged BG coaches and 585 EMUs, still in service.

Due to resource crunch the Indian Railways are not in a position to repair at least 500 railway bridges out of 51,340 bridges of 19th century vintage along routes carrying 13 million passengers everyday. Recently a serious accident was averted on the Delhi-Mumbai main line at Palghar when the foundation of a 120 year-old bridge came apart. It was the failure of the 140 year-old Bridge at Kadalundi, near Calicut, that resulted last year in three coaches falling into the river, claiming 55 lives. Trains are ordered to run at a restricted speed with the caution board “Bridge under distress”.

Is the justification for creation of new zones tenable?

Six former chairpersons of the Railway Board in an open letter to the PM have opined, “The creation of new zones will be an operational debacle, a financial disaster and an administrative blunder.” Indeed, the punctuality of train operation is likely to be jeopardized. Due to increase in interchange points as a sequel to the creation of new zones, speed will have to be reduced and time will be lost while crossing different interchange points. Table-2 below shows the increased number of interchange points and zones, which will act like speed-breakers.

Table - 2Interchange Points
Route Existing zones Changed zones % of increase
Delhi-Mumbai 3 (NR,WR,CR) 4 (NR,NCR WCR WR) 33%
Delhi-Chennai 4 (NR,CR,SR,SCR) 6 (NR,NCR,WCR,CR,SCR,SR) 50%
Delhi-Howrah 2 (NR, ER) 4 (NR,NCR,ECR,ER) 100%

From the administrative point of view, the creation of 7 additional zones will breed bureaucratisation instead of decentralizing the power to divisional headquarters. More powers need to be delegated to the field formations in the division and stations. Since the communication system in the Railway has improved to such an extent that territories in the remote corner of the country can easily be coordinated and efficiently managed, bifurcation does not stand to reason.

Out of total 63,028 route kilometers of Indian Railways all the 9 zonal Railways are having 5000 to 6000 route k.m. on an average under its jurisdiction except Northern Railway having 11,047 k.m. and Western Railway. 10,020 k.m. So even in terms of route kilometers, no other zone except WR and NR needs bifurcation from the administrative angle.

Impact of the proposed reorganisation of ER, SER, NR and WR

Out of a total 4246 route k.m. belonging to Eastern Railway, 1,863 k.m. is being carved out to form the East Central Railway with headquarters at Hazipur with the result that 43% group “D” & “C” staff working at Fairlie Place, Kolkata, i.e., a total 3,421 employees will be transferred to Hajipur and out of 8,400 staff working at South Eastern Railway headquarters, 51% staff to the tune of 4,300 group ‘D’ & ‘C’ staff will be distributed among the two newly organised zones of South East Central Railway and East Coast Railway with headquarters at Bilaspur in Chhatisgarh and Bhubaneswar in Orissa. Respectively. Railway employees in Mumbai and Delhi would also be affected by the transfers. For 25% of the posts in WR headquarters in Mumbai would be transferred to the newly formed North Western Railway in Jaipur and 25% of posts at the Northern Railway headquarters in Delhi would be transferred to Jaipur. Small may be proverbially beautiful, but the ugly reality of smaller railway zones will soon start unfolding itself when the reorganized zones, destined as they are to be starved of resources, begin to be declared ‘sick’.

Bengal’s deprivation versus Bihar’s backwardness

The parameters of backwardness of Bihar or Bengal’s economic retardation is more or less the same in the socio economic structure controlled by the big bourgeoisie and the big landlords. It is true that investment by the Railways in different regions brings with it a degree of development of infrastructure and generates employment in organised and unorganized sector. But deindustrialization in Bengal and semi-feudal economy in Bihar are the basic issues to be addressed seriously to spur development.

If Nitish Kumar is so serious to use the Railways to develop Bihar economically, he should implement the ongoing projects like 3rd line between Gaya and Manpur in Mughalsarai Division, the Bakhtiarpur triangle line, development of passenger terminal at Patna and other pending projects. The money earmarked for new zonal headquarters at Hazipur should be spent for the development of the Railways in Bihar as people in Bihar still travel on rooftops of running trains due to dearth of train services. Moreover, such investment will generate considerable employment in the unorganized sector in Bihar.

So far as Bengal is concerned, Budhadeb and Mamata should insist on completion of projects like Tarakeswar-Bishnupur new line, Gurap-Shaktigarh doubling, Bolpur-Ahmedpur doubling, Barasat-Hasnabad electrification etc. At the same time they should oppose corporatisation of the Chittaranjan Locomotive Works, the only premier railway production units in Bengal.

Zonal reorganization to hit railway unions

The proposed bifurcation is also going to affect the trade union movement in the railways. It is easier to play on the undercurrent of linguistic animosities and divide the railways into smaller zones, so that the authorities can tackle a working class movement with greater ferocity. It is still fresh in the memory how the heroic 20-days strike beginning on 8th May 1974 by 20 lakh Railway employees was ruthlessly repressed by Indira Gandhi. Today the strength has come down to 15,30,000 due to restructuring of Railways and the right-sizing exercise. The same will be further reduced to 8 lacks and with smaller zones the bargaining strength will be crippled.

NDA’s hidden agenda

(i) Superimposition of communal politics in Indian Railways

On the dictates of the NDA Government, the Railway Board (vide circular No. E(LR)III/2000/LR-1-30 dated: 26.6.2002) have instructed the general managers of all railway zones to consider granting recognition to the affiliates of Bharatiya Rail

Mazdoor Sangh owing political allegiance to BMS, the trade union wing of BJP, as soon as they produce certificates of membership strength of 30% of the total non-gazetted employees of the respective zones. Affiliates of BRMS in the newly formed zones have already applied for recognition.

Bifurcation policy suits the BJP’s smaller states concept. Since the NDA Govt. is a conglomerate of regional political formations, regional sentiments get precedence over the all India perspective of the Railways. Creation of smaller zones will serve the interests of the small states to be carved out to divide the country and the people on parochial lines.

(ii) Privatisation: Thr proposed seven new zones as notified would add a huge cost burden and ultimately a number of them will be unviable. And then a case stand will be made for privatisation along the lines of the British Railways as recommended by the Rakesh Mohan Committee.

In lieu of conclusion

Indian railwaymen should seriously ponder over the issue of restructuring of IR and over the inherent weakness of railway trade union movement to confront such conspiracy of the ruling class. Since mid-70’s, particularly after the May’74 historic railway strike, the railwaymen have been gradually isolated from the mainstream of working class movement in our country. They fell prey to the machinations of the reformist leadership in the railway trade union movement. During the last quarter century, numerous strike actions took place in other sectors, but the railwaymen remained mute spectators, let alone the question of taking part in Bharat Bandhs or in events like the last general strike of the Indian working class on April 16 this year. Now it is too late to lament over the past. At this critical juncture the Indian railwaymen who have a heroic tradition of struggle should rise to the occasion to build a permanent Bridge of solidarity with other section of the working class and the people to end their isolation. Indian Railways, the heartbeat of the country, can only be saved from the clutches of the merchants of Washington and Delhi through protracted struggle and in the womb of such struggle can germinate an embryo of mass political movement, paving the way for a new society. The whole country awaits the resurrection of such movement.

(Source: Indian Railways status paper published by the Ministry of Railways)