Railways made money by selling scrap, but reduced catering, parking, advertising revenue

- The target of Indian Railways to earn 10% of total revenue from non-fare sources is unclear

Between 2017 and 2021, Indian Railways earned less than the target revenue from non-passenger fare sources such as catering, advertising, parking, rest areas. However, the Railways generated more revenue than the target by selling the scrap. This information is derived from the Comptroller and Auditor General's (CAG) compliance audit report on Railways presented during the recently concluded budget session of Parliament. In which the revenue of the railways has been presented in four years during the year 2017-21.

The CAG noted that the Railway Board had started a policy of advertising through movable assets in January 2017. The objective of this policy was to facilitate Indian Railways to introduce combined train packages equipped with internal and external advertisements.

The report said that in February 2018, the Railway Board decided to hand over bid management to Zonal Railways due to delay in awarding contracts by REITs. During the period 2018-19 to 2020-21 various agreements were finalized by Zonal Railways under this policy.

According to the report, an examination of the records revealed that the Indian Railways had spent Rs. 93.25 crore (28.28 percent) earned, while the estimated earnings were Rs. 329.70 crore was fixed. It added that the original target of earning revenue from car/scooter parking at stations was not achieved by Indian Railways during the review period except 2017-18. Rs. 956 crore against the original target, the actual revenue was Rs. 613 crore, resulting in a revenue of Rs. 343 crore (36 percent) was reduced, the CAG said.

According to the report of the Comptroller and Auditor General, the Railway Board had prepared a new catering policy in 2017. According to this policy, Indian Railway Catering and Transport Corporation was made responsible for the catering services of mobile catering units, base kitchen, cell kitchen, refreshment room, food plaza at A One and A category stations. A test check of income in 32 divisions of Zonal Railway has revealed that during the year 2017-21, for catering Rs. 72.34 crore (contractually fixed license fee) against a target of Rs. 58.54 crore was spent. A license fee was charged. This resulted in Rs. 13.81 crore license fee was collected short. According to the report, in the recent past, scrap has been identified as a high priority sector for building internal resources to finance the railways. The CGE audit found that the Indian Railways spent Rs 11,418 crore from scrap sales during 2017-21 against a target of Rs 11,418 crore. 11,645 crore earned.

According to the report, a revenue audit in 32 selected divisions of Zonal Railways revealed that the total revenue from retiring rooms during the year 2017-21 was Rs 48.17 crore. It said that a review of various records of selected sections of zonal railways on lease to outside parties, PSUs and government offices revealed that an amount of Rs 23.32 crore was outstanding as on March 31, 2021.

According to the CAG, the share of non-fare revenue as a percentage of receipts declined year-on-year even as the Railways launched a new earnings drive in 2017-18. It has come down from 2.35 percent of miscellaneous income in 2017-18 to 0.04 percent in 2020-21. Thus, Indian Railways' target of earning 10 per cent of total revenue from non-fare sources has remained elusive, the report said.