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Bibek Debroy Committee’s Vision for Indian Railways
Context:
Bibek Debroy, who passed away late last week, had a deep interest in the Indian Railways, which he expressed through both his 2015 reform report and a series of limericks. The Debroy Committee, led by him, outlined a roadmap to make Indian Railways more economically viable and competitive. While some of the committee’s suggestions have been adopted, many remain a work in progress.
Bibek Debroy Committee’s Vision for Indian Railways:
- In 2015, the Bibek Debroy Committee, led by the late economist Bibek Debroy, laid out a comprehensive reform plan to revitalise Indian Railways, targeting financial sustainability and improved competitiveness.
- The committee’s report, titled The Committee for Mobilization of Resources for Major Railway Projects and Restructuring of Railway Ministry and Railway Board, proposed changes across decision-making, resource allocation, and management structure.
- The emphasis was on empowering railway officers, enhancing accountability, and selectively liberalising operations without full privatisation. Here’s a look at the key recommendations, their current status, and Debroy’s legacy.
Key Recommendations Implemented:
- Empowering Railway Officers
- Recommendation: Decentralise decision-making, giving more authority to General Managers (GMs), Divisional Railway Managers (DRMs), and branch officers to improve efficiency.
- Status: Partially implemented, with GMs and DRMs now holding more decision-making power.
- Redesignating Leadership Roles
- Recommendation: Transform the Chairman of the Railway Board into a Chief Executive Officer (CEO), aligning the Railway Board with a corporate governance model for more streamlined accountability.
- Status: Implemented in 2020, with the first CEO appointed, granting the position final decision-making authority.
- Accounting System Overhaul
- Recommendation: Shift from cash-based to accrual-based accounting to improve financial transparency.
- Status: Initiated in 2017, with accrual-based accounting being adopted alongside the traditional cash-based system.
- Rail Development Authority (RDA)
- Recommendation: Establish an independent regulator to oversee competition, pricing, and revenue enhancement.
- Status: The Rail Development Authority (RDA) was constituted in 2017, providing advisory support for pricing and competition but with limited regulatory powers.
- Safety Fund – Rashtriya Rail Sanraksha Kosh (RRSK)
- Recommendation: Create a dedicated safety fund to upgrade and maintain critical safety assets.
- Status: Implemented in 2017 with an initial Rs. 1 lakh crore allocation, extended with an additional Rs 45,000 crore for the next five years.
- Skill Development and Technological Integration
- Recommendation: Focus on developing specialised skills and modernising technology in the Railways.
- Status: Initiatives like Gati Shakti Vishwavidyalaya and technological upgrades, such as KAVACH safety systems and Vande Bharat trains, have been introduced, aligning with this vision.
Recommendations Partially Implemented:
- Decentralisation and Independent Divisions
- Recommendation: Treat divisions as independent business units, giving DRMs authority over local operations and tenders.
- Status: Progress has been made, but full decentralisation remains ongoing.
- Offloading Non-Core Services
- Recommendation: Reduce financial burden by offloading non-core services like Railway Protection Force (RPF) security and employee medical and educational facilities.
- Status: Under government review; no final decision has been made.
- Performance Assessment System
- Recommendation: Create a transparent, objective system for assessing railway performance.
- Status: Under examination, with no specific implementation measures introduced yet.
The Bibek Debroy committee recommended reforms for railways . The Indian railways should be separated into two:
- Railway Infrastructure Corporation( RIC)
- Indian Railway Trains( IRTs)
On the railway infrastructure provided by RIC , government trains (IRTs) and private trains both will run and they will have to pay charges to RIC . ( Operations done by Government)
Key Recommendations Rejected:
- Liberalisation of Indian Railways
- Recommendation: Allow entry of private (domestic and foreign) operators to boost competition and service quality, without fully privatising passenger services.
- Status: Not accepted due to opposition from unions and political concerns over passenger services.
- The government retains control over passenger operations, although limited Public-Private Partnership (PPP) projects exist in the freight sector.
- Independent Regulator with Broader Powers
- Recommendation: Establish an independent regulatory body with comprehensive powers to govern railway competition and pricing.
- Status: While the RDA was formed, it holds limited powers compared to the independent regulator envisioned by the committee.
