“The Railway Budget sounds ambitious to state the least but given the track record, especially of last year, implementation seems unlikely again. For instance, the minister targets 700km of rail line addition in FY12 compared to ~180km average. This figure is irrelevant because even last year the aim was for 1,000km, which missed the target by a wide margin. Despite financial constraints, populist measures were announced in the light of upcoming state elections.

The power plant and wagon manufacturing projects face challenges in terms of land acquisition and financing. For projects announced in smaller towns, material sourcing remains a major constraint.

No change in passenger rates was along expected lines as part of the populist measure. Freight tariff was kept unchanged given the slowdown in business.  Overall, finances have deteriorated and the operating ratio has touched ~93%. One can only hope that the railway ministry picks up pace in PPP proposals and quickly sets up a single window for such approvals. All-in-all, a negative budget on expected lines.”