Transformational Organisational Restructuring Of Indian Railways


  • On 24th December, 2019, the Union Cabinet approved a transformational organisational restructuring of the Indian Railways. The reforms announced are in continuation with the series of decisions under which the Railway Budget was merged with the Union Budget, delegation of powers to empower GMs and field officers, allowing competitive operators to run trains.
  • This reform has been undertaken with the overwhelming support and consensus of Railway officers, at a two-day conference "Parivartan Sangoshthi" held in Delhi on 7th and 8thDecember, 2019.
  • It is to be noted that restructuring of the Railway Board was also recommended by the Bibek Debroy Committee on Indian Railways in 2015.

Aim

  • To modernise and envisage smooth working of Indian Railways.

Need

  • Indian Railways is plagued with the menace of Departmentalism, which was marked by inefficiency in work, infighting over control of assets and resources and delay in decision making, ultimately hampering the operation of Indian Railways.
  • The government has lined up a massive infrastructure development plan of nearly Rs. 50 trillion to modernise the national transporter in the coming years, with an aim of improving safety, speed, and services.This requires speed and scale, and a unified, agile organisation to work single-mindedly on this task and capable of responding to challenges.

Proposed Major Reforms

Reduced Board Members

  • At present, the railway board includes eight members; member (rolling stock), member (traction), member (traffic), member (engineering), member (staff), member (material management), members (signal & telecom) and financial commissioner.
  • Now, there will be five members for Rolling Stock and Traction (engines, coaches, wagons, etc), Operations and Business Development, Finance, Infrastructure (track, signalling and telecom, etc).
  • The Railway Board—the apex decision making body of the Indian Railways—will be headed by a chairman, who will be the chief executive officer (CEO).

Single Cadre

  • Indian Railways will now have only one cadre –Indian Railway Service, instead of current eight services for various departments including Engineering, Traffic, Mechanical and Electrical.

Indian Railway Management Service (IRMS)

  • Existing eight Group A services of the Railways will be unified into a Central Service called Indian Railway Management Service (IRMS).
  • Creation of the new service will be done in consultation with DoPT and UPSC to facilitate recruitment in the next recruitment year.
  • The Railways will also now have just two departments -Railway Protection Force and Medical Service Department, with all its other departments coming under one Railway Management System.
  • The existing service of Indian Railway Medical Service (IRMS) to be consequently renamed as Indian Railway Health Service (IRHS).

Impact

End of Departmentalism

  • This reform will help in breaking a 150-year-old tradition of ‘working in silos’ that can remove departmental tussles, seen as a roadblock in operation of railways.
  • Unification of services will put an end to the departmentalism and promote smooth working of Railways, expedite decision making, create a coherent vision for organisation and promote rational decision making and will set the path of Indian Railways to a high growth trajectory.

Ensuring Transparency

  • The modalities and unification of the services will lead to fairness and transparency in the Indian Railways.

Making Railway Growth Engine of India

  • This historic reform will go a long way in achieving Government’s vision of making Indian Railways the growth engine of India's vikas yatra.

Important Railways Committees

  • The unification of services had earlier been mooted by various committees for reforming Railways including - the Prakash Tandon Committee (1994), Rakesh Mohan Committee (2001), Sam Pitroda Committee (2012) and Bibek Debroy Committee (2015).

Bibek Debroy Committee – 2015

  • The Bibek Debroy Committee high level committee for - Mobilization of Resources for Major Railway Projects and Restructuring of Railway Ministry and Railway Board, was constituted in  September, 2014 in order to prepare a blueprint for reforming Indian Railways. The committee submitted its report in June, 2015.

Major Recommendations

  • Railway Regulatory Authority of India (RRAI): It recommended setting up an overarching Railway Regulatory Authority of India (RRAI) as an independent regulatory body.
  • Moving to Standard Commercial Accounting: Transition to commercial accounting Indian Railways should shed its complicated accounting and move to standard commercial accounting by following principles and norms accepted nationally and internationally.
  • Technical and Non-Technical Services: It recommended to reorganize the present eight organized Group - A services in Indian Railways in two bigger groupings viz. technical and non-technical services.
  • Merging Railway Budget with Central Government Budget: A separate Railway budget should be phased out progressively and merged with the General Budget.
  • Focus on Core Activities: Indian Railways should focus on core activities to efficiently compete with the private sector. It will distance itself from non-core activities, such as running a police force, schools, hospitals and production and construction units
  • Raising Resources: An Investment Advisory Committee may be set up, consisting of experts, investment bankers and representatives of SEBI, RBI, IDFC andother institutions for raising resources for investment.

Sam Pitroda Committee - 2012

  • Expert Group on Modernisation of Indian Railways was constituted by the Railway Ministry under the Chairmanship of Sam Pitroda in September, 2011. The Expert Group submitted its report in February, 2012.

Major Recommendations

  • Mission mode approach for 15 focus areas – track and bridges, signaling, rolling stock, stations, dedicated freight corridors, High speed trains, review of existing and proposed projects, ICT, indigenous development, safety, funding and human recourses.
  • Development of 34 multi modal logistic parks.
  • To set up real time information system.
  • To attract private investment through PP models for freight terminals, high speed railway lines, leasing wagons, coach and loco manufacturing renewable energy generation etc.
  • Construction of Eastern and Western Freight Corridors.
  • Construction of high speed Railway line between Ahmedabad and Mumbai with a speed of 300 kmph.
  • Establish Indian Institute of Railway Research.
  • To offer Graduate programme in Railway Technology in IITs and Railway Management in IIMs.
  • Revamping accounting system on business lines.
  • Empower Zonal Railways in investment decision with accountability for return on capital, transport output, safety and profitability.