Making Indian Railways profitable and sustainable
I have a couple of suggestions to help Indian Railways become profitable.
1. First and foremost, Introduce four railway price bands as below.
a. Subsidized price - For BPL card holders
b. General price - Not the price of ticket in general class, but the current standard train fare.
c. Dynamic price - On premium trains
d. Market price - Special trains/coaches.
Of these the dynamic pricing and market pricing will increase revenue for railways considerably. The details of how the dynamic and market price can be utilized is below;
1. Introduce premium trains on high demand and especially overnight routes on weekends. For example, Mumbai to Pune and Bangalore to Kerala on weekends. People generally prefer Railways over buses and are willing to pay a premium if confirmed tickets are made available. Ensure that there is no cancellation facility else this service will be misused. The price for these trains should preferably be dynamic with increase in charge as journey date gets closer. For gaining maximum benefit from dynamically priced premium trains it is imperative that following requirements are met
i) Premium trains should have no ticket cancellation facility
ii) Premium trains should preferably be overnight (considering current average train speed that would be around 800KM distance). The reason being, many people travel to home towns on weekends.
iii) Premium trains on routes should be run on the day of the week when there is maximum demand (this would generally be weekends but may vary with regions). The train start time would need to be after office hours.
To sum it up in one line premium trains with dynamically priced ticket on Friday evening and traveling overnight distances (generally up to 800 km) originating from major cities, with return journey on Sunday will increase the revenue considerably.
2. Enable online booking of group travel including booking special train, special coaches. The current process is long drawn. This will enable corporate group travel, group tourist travel, group pilgrimage. The price can be set at market price. By market price, I mean the actual cost of operation (not at the subsidized price) plus around a 20% profit margin. more
1. First and foremost, Introduce four railway price bands as below.
a. Subsidized price - For BPL card holders
b. General price - Not the price of ticket in general class, but the current standard train fare.
c. Dynamic price - On premium trains
d. Market price - Special trains/coaches.
Of these the dynamic pricing and market pricing will increase revenue for railways considerably. The details of how the dynamic and market price can be utilized is below;
1. Introduce premium trains on high demand and especially overnight routes on weekends. For example, Mumbai to Pune and Bangalore to Kerala on weekends. People generally prefer Railways over buses and are willing to pay a premium if confirmed tickets are made available. Ensure that there is no cancellation facility else this service will be misused. The price for these trains should preferably be dynamic with increase in charge as journey date gets closer. For gaining maximum benefit from dynamically priced premium trains it is imperative that following requirements are met
i) Premium trains should have no ticket cancellation facility
ii) Premium trains should preferably be overnight (considering current average train speed that would be around 800KM distance). The reason being, many people travel to home towns on weekends.
iii) Premium trains on routes should be run on the day of the week when there is maximum demand (this would generally be weekends but may vary with regions). The train start time would need to be after office hours.
To sum it up in one line premium trains with dynamically priced ticket on Friday evening and traveling overnight distances (generally up to 800 km) originating from major cities, with return journey on Sunday will increase the revenue considerably.
2. Enable online booking of group travel including booking special train, special coaches. The current process is long drawn. This will enable corporate group travel, group tourist travel, group pilgrimage. The price can be set at market price. By market price, I mean the actual cost of operation (not at the subsidized price) plus around a 20% profit margin. more
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Also each Station shall be Profit Center on its own, Ticket money collection shall go to Railways & all other expenses regarding Station shall be earned from Station like Hoarding, Stalls & other legal means ( Fine collection) & salary of the staff needs to be paid from that, Station master shall be responsible for that. Basically Decentralized. put Audit system in Place. more
Jun 21
