Earning Margin Of Indian Railways Slips To 10-Year Low, Says CAG Report

Amid the massive economic slowdown, the earning margin of Indian Railways has slipped to the worst in the last 10 years, according to the Comptroller and Auditor General (CAG) report tabled in Parliament on Monday. In 2017-18, the Railways recorded an operating ratio of 98.44 per cent, which is the worst in the previous 10 years.

The operating ratio is a measure against revenue and shows the efficiency of Railways operations and its financial health. The operating ratio of 98.44 means that the Railways spend Rs 98.44 to earn Rs 100.

The railways ended with a surplus of Rs 1,665.61 crore. However, it would have ended with a negative balance of Rs 5,676.29 crore had it not received the advance from NTPC and IRCON, the CAG report said.

"The Indian Railways' operating ratio at 98.44 per cent in 2017-18 was the worst in the last 10 years,” the national auditor, Comptroller and Auditor General (CAG), said in a report tabled in Parliament on Monday. "Exclusion of this advance would otherwise have increased the operating ratio to 102.66 per cent," the auditor said.

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The Railways has also been unable to meet its operational cost of passenger services and other coaching services. Almost 95 per cent of the profit from freight traffic was utilised to compensate for the loss on operation of passenger and other coaching services, it said.

The audit analysis of the finance accounts of Indian Railways revealed a declining trend of revenue surplus and the share of internal resources in capital expenditure. The net revenue surplus decreased by 66.10 per cent from Rs 4,913.00 crore in 2016-17 to Rs 1,665.61 crore in 2017-18.

The share of internal resources in total capital expenditure also decreased to 3.01 per cent in 2017-18. "This had resulted in greater dependence on Gross Budgetary Support and Extra Budgetary Resources," the CAG said.

(With PTI inputs)