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BIDDING FAREWELL TO RAILWAYS BUDGET
From next financial year (2017-18) on, an almost century-old practice of separating Railway budget presented ahead of a General Budget is set to be dispensed with. The Railway Budget thereon is to be merged with the General Budget. This will dispense the Indian Railways from paying an annual dividend to the Government of India on account of budgetary support given each year, thereby saving about Rs. 10000 crore for the distressed railways annually. The discontinuance of a separate Railway Budget was also recommended by Bibek Debroy Committee. As pointed out by the Finance Minister, the share of Railways in general Budget had increasingly decreased making separate budget a holdover. But there is more to the presented picture. The dividend is also paid on capital at charge and this includes the GBS (Gross budgetary Support) of the previous years. Thus, the merger of two budgets has converted Loan in perpetuity to a grant as in a loan waiver. Should there be separate budget for Railways? The fact is Indian Railways is unlike any other ministry whether is size or scope, its gross earnings, staff strength, the fact that it earns as well as spends unlike other ministries which only spends or that it fully meets the pension liabilities of its retired employees. Does the separation of two budgets mean that the government will be funding the pension liabilities of this ministry amounting to Rs. 45000 crores. That would be some saving indeed! The Bibek Debroy Committee had recommended the merger of budgets but along with slew of other measures to reform the entire architecture- financial and non-financial of Railways. But what the common man needs to know is that the finances of Railways will be shored up but not by improving efficiency or revenue and cutting expenditure but under the garb of reforms.

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