Source: https://www.tribuneindia.com/news/nation/only-ac-3-tier-earned-rlys-profit-cag-report-353513
Publisher: Shubhadeep Choudhury
AC-3 tier, the favourite mode of train travel of people falling in the bottom rung of the middle class, is the only class that earns the Railways profit among all its passenger services. AC-3 tier comprises air-conditioned coaches with 64 sleeping berths.
“All classes of train services have incurred losses during 2019-20, except AC-3 tier which could recover its operational cost and earn profit,” stated a report of the Comptroller and Auditor General of India (CAG) for the period tabled in the Rajya Sabha session that concluded today.
According to the CAG report, Railways incurred maximum loss — Rs 20,449.92 crore — from its ordinary class service during 2019-20, followed by the sleeper class service (Rs 16,000 crore). However, first class service reported the minimum loss (Rs 37.89 crore). Profit by AC-3 tier, though, is showing a decline over the years. The CAG report gave year-wise details of the profits and losses made by the various classes of the passenger services since 2015-16.
It showed that from Rs 898.06 crore in 2015-16, the profit of AC-3 service came down to a whopping Rs 64.65 crore in 2019-20.
The profit of AC-3 service had risen to Rs 1,040.52 crore in 2016-17, but plummeted to Rs 737.75 crore in 2017-18 and dropped further to Rs 318.03 crore in 2018-19.
“The cross-subsidisation in respect of second class, ordinary class and suburban services has increased continuously in the past five years with subsidy on ordinary class being the maximum,” the report stated.
The CAG noted that one of the contributing factors for non-recovery of full cost from these classes is free and concessional fare passes or tickets to various beneficiaries. The revenue forgone in passenger earnings due to concessions to various categories of passengers (physically challenged persons, patients, senior citizens, Izzat monthly season tickets, press correspondents, sportpersons and war widows among others) increased from Rs 1,994.83 crore in 2018-19 to Rs 2,058.61 crore in 2019-20.
