8 July 2014

New India rail minister seeks foreign investment

Indian Railway Minister Sadananda Gowda, left, shows the briefcase containing Rail budget for the year 2014 to media persons as he arrives in the parliament house to present the budget, as junior minister for Railways Manoj Sinha, center right, watches, in New Delhi, India, Tuesday, July 8, 2014. Indian Railways is one of the world's largest and serves 23 million passengers a day.
India's new rail minister on Tuesday proposed allowing foreign investment to modernize the country's cash-strapped state railways.
Sadananda Gowda also outlined plans for a network of high-speed trains, with the first project slated to connect the financial capital, Mumbai, with the home state of new Prime Minister Narendra Modi.
The ambitious proposals unveiled Tuesday as part of the annual rail budget indicated Modi's government intends to move quickly to follow through on reform promises. Investors have been looking for signs as to how bold the new government, which swept to power in May, will be in implementing its agenda to revive economic growth. Some of its changes could be politically unpopular. Another test will come Thursday when the government unveils its first national budget.
An Indian woman looks out through the window of a train as it leaves a railway station in Jammu, India, Monday, July 7, 2014. India on Tuesday is expected to announce the budget for the national railways system, which is one of the world's largest and serves 23 million passengers a day.
Modi said the rail plans "indicate where we want to take the railways and through that where we want to take India."
Gowda on Tuesday said that fare hikes alone cannot pay for the upgrades needed for the railways, which run on dilapidated tracks and with ancient rolling stock. Poor infrastructure is blamed for a large number of Indian rail accidents.
He said partnerships between the government and private companies should be used for system upgrades, though operations would still be handled solely by the government. Allowing private investment in the network would require Cabinet approval.
India has one of the world's largest railways, which transports 23 million passengers a day. Indian Railways is one of the world's biggest employers with more than 1.3 million employees. The network lost 300 billion rupees ($5 billion) last year.
Indian Railway Minister Sadananda Gowda, shows the briefcase containing Rail budget for the year 2014 to media persons as he arrive in the parliament house to present it, in New Delhi, India, Tuesday, July 8, 2014. Indian Railways is one of the world's largest and serves 23 million passengers a day.
A 2012 government-sponsored report said the railways need nearly 5.6 trillion rupees ($93 billion) over the next five years to upgrade infrastructure.
One of the Modi government's first acts when it took office was to raise rail passenger fares by more than 14 percent, an unpopular move that was partially rolled back after an outcry.
The backdown on train fares indicated the tough balance the new government must strike in trying to shore up loss-making state companies and narrow India's worrisome fiscal deficit.
Millions of Indians have become accustomed to subsidized food, fuel and fertilizer and any cuts in those subsidies in Thursday's budget would likely put a dent in the new government's early popularity.
Likely opposition to any sweeping change was evident in the opposition Congress party's vehement response to the railway budget.
An Indian snacks vendor crosses railway tracks with his bicycle even as a train approaches, behind, in Hyderabad, India, Monday, July 7, 2014.Railway accidents, most of them blamed on poor maintenance and human error are common in India, which has one of the world's largest train networks and serves 23 million passengers a day. India announces the budget for the national railways system on Tuesday.
"It appears that this is not a rail budget, but a scheme to privatize Indian railways," said Manish Tewari, a Congress party spokesman.
The Congress party has dominated Indian politics for all but a decade since the country threw off British rule in 1947. It was in power for 10 years before losing the most recent elections in May by a landslide. 
(AP)
Indian passengers look at the camera as they await a train at a railway station in Jammu, India, Monday, July 7, 2014. India on Tuesday is expected to announce the budget for the national railways system, which is one of the world's largest and serves 23 million passengers a day.
An Indian man walks in front of a train as a motorcycle being transported is kept on a platform at the Secunderabad railway station in Hyderabad, India, Monday, July 7, 2014. India on Tuesday is expected to announce the budget for the national railways system, which is one of the world's largest and serves 23 million passengers a day.
A baby sleeps in a make shift cradle made of a piece of cloth as passengers sit inside a train coach in Hyderabad, India, Monday, July 7, 2014. India on Tuesday is expected to announce the budget for the national railways system, which is one of the world's largest and serves 23 million passengers a day.
Indian passengers walk at a platform at the Secunderabad railway station in Hyderabad, India, Monday, July 7, 2014. India on Tuesday is expected to announce the budget for the national railways system, which is one of the world's largest and serves 23 million passengers a day.

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