Saturday, March 7, 2015
Friday, February 27, 2015
Views on Rail Budget in Economic Times, Times of India, Indian Express and other newspapers
http://computer.financialexpress.com/news/overall-a-very-well-balanced-rail-budget-jaijit-bhattacharya/9686/
http://www.firstpost.com/budget/railway-budget/rail-budget-2015-is-nicely-balanced-but-where-are-the-funds-going-to-come-from-2124769.html
http://www.businessworld.in/news/business/infrastructure/railways-to-see-137-bn-investment-in-5-years/1752531/page-1.html
Jaijit Bhattacharya, Partner, Infrastructure and Government Services, KPMG India, said: The Rail budget has all the right articulations. We welcome the greater role of private sector in station operation, railway electrification and other activities. The aim to have an Operating Ratio of 88.8% is also very welcome and forward looking. However, one would like to see the details of how Railways will be able to manage this target. Also, while it has been mentioned that there will be no hike in railway passenger fares, it appears that the fare reduction due to Fuel Adjustment Component will not be applied.
http://economictimes.indiatimes.com/industry/transportation/railways/rail-budget-2015-suresh-prabhu-proposes-an-annual-investment-plan-of-rs-1-lakh-crore/articleshow/46380149.cms
Even if the project is structured appropriately, the last decade of experience of PPP in this country has not been smooth. Ground realities need to be taken into account. It would take a few investment cycles to bring back trust in PPP in the country
http://www.firstpost.com/business/rail-budget-2015-7-stats-that-show-by-how-prabhu-plans-to-beat-his-predecessors-2123361.html
"Excellent initiatives in Ease of Doing Business with Railways in the Rail budget. If the initiatives are implemented, it will improve on the private sector trust and hence help in attracting private sector participation in railways," said Jaijit Bhattacharya, partner, infrastructure and government services at KPMG in India, adding it is on overall well-balanced budget.
From a vision and articulation point of view, it was very much a high-technology budget. These are not just incremental changes, there was a wow factor for sure,” said Jaijit Bhattacharya, partner, government advisory, KPMG.
He added that not just ICT technology had been talked about but also high-end technology, be it vacuum toilets or semi-high-speed rail. “It is all in the right direction, though the bigger concern is the implementation part of it,” Bhattacharya said.
Rail Budget 2015 is nicely balanced, but where are the funds going to come from?
Feb 27, 2015 09:55 IST
By Jaijit Bhattacharya
The budget articulates the vision of transforming the Indian railways in a systematic process over a longer period of time rather than having a big bang approach. It is a balanced budget. However, it leaves question mark on the challenge of convincingly garnering the significant amount of funds required for this audacious transformation.
The budget laid out four goals of
a) To deliver a sustained and measurable improvement in customer experience
b) To make Rail a safer means of travel
c) To expand Bhartiya Rail’s capacity substantially and to modernize infrastructure
d) To make Indian Rail financially self-sustainable.
The budget laid out a goal to increase the Indian railways network to 1.38 lakh kilometers and freight traffic from 1 billion tonnes to 1.5 billion tonnes.
The budget adopts an execution strategy based on five drivers
- Adopting a medium-term perspective
- Building Partnerships with states, PSUs, multilateral agencies and private sector for ensuring financing and last mile connectivity
- Leveraging additional resources;
- Revamping management practices, systems, processes, and re-tooling of human resources
- Setting standards for Governance and Transparency.
The budget laid emphasis on gauge conversion over next 5 years and a focus on running fast trains like Rajdhani, Shatabdi by decongesting existing high density routes. It also laid out a goal of increasing track length by 20 percent to 138,000 km in next 5 years. This initiative would also provide significant opportunities to the private sector, if it is actually achieved.
The budget also articulated the objective of substantially regaining freight market share. However, in light of the increase in freight rates, and competition from truckers, it is not clear how Railways actually plans to increase its freight market share.
Although the budget announced no hike in passenger fares, there is an implicit hike as the Fuel Adjustment Component (FAC) that was due to be applied in December 2014, is not being applied.
FAC was designed to pass on the fuel hike or fuel price reduction to the passengers. With the fuel price falling by over 20 percent, the fares should have been reduced. However, there is no mention of the FAC being applied in the near future.
Promise of hygiene
The budget take forward the national flagship program of Swachh Bharat with a focus on hygiene. It promises to adopt vacuum toilets (which exist in aircrafts) in 17,000 places. The Railways plans to build new toilets covering 650 additional stations compared to 120 stations last year. Indian railways will fit Bio-toilets in coaches and is in the process of replacing the existing toilets with 17,388 bio toilets.
The quality of Indian Railways’ On-board Housekeeping Service (OBHS), presently available in 500 pairs of trains, is being re-looked to make it more effective. Indian railways will take steps immediately to address customer concerns.
The budget also brings in focus on the other national program of ‘Make in India’. The local manufacturing will focus on High Horse Power and green technology locomotives, commodity specific wagons like auto carriers, signaling systems and train protection systems and track laying and track maintenance machines.
Focus on safety is a key feature of this budget. It laid out a goal of eliminating all unmanned level crossings by construction of Road over Bridges (ROBs) and Road under Bridges (RUBs). In the short term, RDSO has been asked to develop a suitable device with reliable power supply system based on theft-proof panels/batteries in consultation with Indian Space Research Organization, using geo-spatial technology for providing audio-visual warning to road users at unmanned level crossings.
Further, a radio based signal design project has been taken up with IIT Kanpur for warnings at unmanned level crossing. As part of the budget vision, many other technologies and programmes will be adopted for enhancing railway safety.
Emphasis on technology
This budget also emphasized very significant uptake of technology in every area, and not being limited to only information technology. It lays out a desire to adopt high technology in the areas ranging from toilet and signalling to safety and ticket bookings as well as food ordering. It also lays emphasis on technology creation where it does not exist.
The budget provides for the Indian Railways to be socially sensitive, with railway infrastructure support for the visually challenged, senior citizens, women and defence personnel. It also provides for the role of Indian railways in skill development and employment generation through self-employment.
From a more fundamental structural reforms perspective, the budget laid out a goal of Indian railway to target an operating ratio of 88.5 percent, in the background of the central government providing limited budgetary support. Such a goal would free up some revenues for investing on capital projects and the safety enhancement as laid out in the budget.
Although the budget speech mentioned that pension funds, multi-lateral funds, JV’s with state government and PSU’s and PPP would be the means of garnering the funds required to meet the staggering capital requirement of Rs 8.5 trillion rupees in the next five years, it is hard to envisage pension funds bringing in this capital in the short to medium term. The other bodies such as state government, PSU’s and multi-lateral bodies will find it difficult to provide for this quantum of funds.
Overall the budget is visionary and lays out a longer terms vision for the Indian Railways and should be seen in conjunction with the proposed Vision 2030 document that is proposed to be released in the latter part of this year. Such an approach would provide the much needed continuity in restructuring, strengthening and modernizing this very important piece of infrastructure which is crucial for an efficient functioning and growth of the economy. It would be in the interest of the nation that this vision succeeds and that the necessary funding is managed.
(The author is Partner, Infrastructure and Government Services at KPMG in India)
The budget articulates the vision of transforming the Indian railways in a systematic process over a longer period of time rather than having a big bang approach. It is a balanced budget. However, it leaves question mark on the challenge of convincingly garnering the significant amount of funds required for this audacious transformation.
Representational image. PTI
a) To deliver a sustained and measurable improvement in customer experience
b) To make Rail a safer means of travel
c) To expand Bhartiya Rail’s capacity substantially and to modernize infrastructure
d) To make Indian Rail financially self-sustainable.
The budget laid out a goal to increase the Indian railways network to 1.38 lakh kilometers and freight traffic from 1 billion tonnes to 1.5 billion tonnes.
The budget adopts an execution strategy based on five drivers
- Adopting a medium-term perspective
- Building Partnerships with states, PSUs, multilateral agencies and private sector for ensuring financing and last mile connectivity
- Leveraging additional resources;
- Revamping management practices, systems, processes, and re-tooling of human resources
- Setting standards for Governance and Transparency.
The budget laid emphasis on gauge conversion over next 5 years and a focus on running fast trains like Rajdhani, Shatabdi by decongesting existing high density routes. It also laid out a goal of increasing track length by 20 percent to 138,000 km in next 5 years. This initiative would also provide significant opportunities to the private sector, if it is actually achieved.
The budget also articulated the objective of substantially regaining freight market share. However, in light of the increase in freight rates, and competition from truckers, it is not clear how Railways actually plans to increase its freight market share.
Although the budget announced no hike in passenger fares, there is an implicit hike as the Fuel Adjustment Component (FAC) that was due to be applied in December 2014, is not being applied.
FAC was designed to pass on the fuel hike or fuel price reduction to the passengers. With the fuel price falling by over 20 percent, the fares should have been reduced. However, there is no mention of the FAC being applied in the near future.
Promise of hygiene
The budget take forward the national flagship program of Swachh Bharat with a focus on hygiene. It promises to adopt vacuum toilets (which exist in aircrafts) in 17,000 places. The Railways plans to build new toilets covering 650 additional stations compared to 120 stations last year. Indian railways will fit Bio-toilets in coaches and is in the process of replacing the existing toilets with 17,388 bio toilets.
The quality of Indian Railways’ On-board Housekeeping Service (OBHS), presently available in 500 pairs of trains, is being re-looked to make it more effective. Indian railways will take steps immediately to address customer concerns.
The budget also brings in focus on the other national program of ‘Make in India’. The local manufacturing will focus on High Horse Power and green technology locomotives, commodity specific wagons like auto carriers, signaling systems and train protection systems and track laying and track maintenance machines.
Focus on safety is a key feature of this budget. It laid out a goal of eliminating all unmanned level crossings by construction of Road over Bridges (ROBs) and Road under Bridges (RUBs). In the short term, RDSO has been asked to develop a suitable device with reliable power supply system based on theft-proof panels/batteries in consultation with Indian Space Research Organization, using geo-spatial technology for providing audio-visual warning to road users at unmanned level crossings.
Further, a radio based signal design project has been taken up with IIT Kanpur for warnings at unmanned level crossing. As part of the budget vision, many other technologies and programmes will be adopted for enhancing railway safety.
Emphasis on technology
This budget also emphasized very significant uptake of technology in every area, and not being limited to only information technology. It lays out a desire to adopt high technology in the areas ranging from toilet and signalling to safety and ticket bookings as well as food ordering. It also lays emphasis on technology creation where it does not exist.
The budget provides for the Indian Railways to be socially sensitive, with railway infrastructure support for the visually challenged, senior citizens, women and defence personnel. It also provides for the role of Indian railways in skill development and employment generation through self-employment.
From a more fundamental structural reforms perspective, the budget laid out a goal of Indian railway to target an operating ratio of 88.5 percent, in the background of the central government providing limited budgetary support. Such a goal would free up some revenues for investing on capital projects and the safety enhancement as laid out in the budget.
Although the budget speech mentioned that pension funds, multi-lateral funds, JV’s with state government and PSU’s and PPP would be the means of garnering the funds required to meet the staggering capital requirement of Rs 8.5 trillion rupees in the next five years, it is hard to envisage pension funds bringing in this capital in the short to medium term. The other bodies such as state government, PSU’s and multi-lateral bodies will find it difficult to provide for this quantum of funds.
Overall the budget is visionary and lays out a longer terms vision for the Indian Railways and should be seen in conjunction with the proposed Vision 2030 document that is proposed to be released in the latter part of this year. Such an approach would provide the much needed continuity in restructuring, strengthening and modernizing this very important piece of infrastructure which is crucial for an efficient functioning and growth of the economy. It would be in the interest of the nation that this vision succeeds and that the necessary funding is managed.
(The author is Partner, Infrastructure and Government Services at KPMG in India)
My views on the Rail Budget
http://computer.financialexpress.com/?p=9686
Jaijit Bhattacharya, Partner, infrastructure and Government Services, KPMG, hailed the maiden Rail Budget presented by Railway Minister Suresh Prabhu today.
“The Rail budget has all the right articulations. We welcome the greater role of private sector in station operation, railway electrification and other activities. The aim to have an Operating Ratio of 88.8% is also very welcome and forward looking. However, one would like to see the details of how Railways will be able to manage this target. Also, while it has been mentioned that there will be no hike in railway passenger fares, it appears that the fare reduction due to Fuel Adjustment Component will not be applied,” said Bhattacharya
“Other passenger enhancement focussed initiatives, safety and modernization of railways, including introduction of high speed railways is welcome. Excellent initiatives in Ease of Doing Business with Railways in the Rail budget. If the initiatives are implemented, it will improve on the private sector trust and hence help in attracting private sector participation in railways,” he added
Overall a very well balanced Rail budget: Jaijit Bhattacharya
“The Rail budget has all the right articulations. We welcome the greater role of private sector in station operation, railway electrification and other activities. The aim to have an Operating Ratio of 88.8% is also very welcome and forward looking. However, one would like to see the details of how Railways will be able to manage this target. Also, while it has been mentioned that there will be no hike in railway passenger fares, it appears that the fare reduction due to Fuel Adjustment Component will not be applied,” said Bhattacharya
“Other passenger enhancement focussed initiatives, safety and modernization of railways, including introduction of high speed railways is welcome. Excellent initiatives in Ease of Doing Business with Railways in the Rail budget. If the initiatives are implemented, it will improve on the private sector trust and hence help in attracting private sector participation in railways,” he added
Thursday, February 26, 2015
Thursday, November 6, 2014
Indian Cities: Need for going beyond Smart Cities
http://egov.eletsonline.com/2014/11/indian-cities-need-for-going-beyond-smart-cities/
Posted by: Elets News Network (ENN)
Posted on: November 3, 2014
Posted in: News
Given the pent up demand for living a better quality of life, it won’t be surprising to witness new cities in India getting swamped by migrants, for which the country need to have better planning, believes Jaijit Bhattacharya, Government Transformation Expert and Partner, KPMG
Posted by: Elets News Network (ENN)
Posted on: November 3, 2014
Posted in: News
Given the pent up demand for living a better quality of life, it won’t be surprising to witness new cities in India getting swamped by migrants, for which the country need to have better planning, believes Jaijit Bhattacharya, Government Transformation Expert and Partner, KPMG
When cities such as Singapore were built, labour
was brought in from neighbouring countries such as Malaysia, Indonesia and from
Bangladesh. Once the construction work got over, the labour went back from where
they came. The outcome was a clean, manageable city with a current population of
5.5 million.
When cities in China were being built, the labour
came from the hinterland and once the cities got built, the labour had to leave
the city as per the Hukou system, which only permits certified residents to have
access to the city facilities. This ensures that the mass urban migration is
controlled and the cities are manageable.
However, when the proposed Smart Cities in India
get developed, Indian cities will not have any mechanism to prevent mass
migration from swamping the city and ultimately destroying them. We have seen
this happen in the past where in cities like Kolkata were swamped by migrations,
especially during the 1943 famine. Given the pent up demand for better quality
cities arising from an aspiration for better quality of life, it is easy to see
why new cities will soon get swamped by migrants.
Hence, any planning of a new city in India will
require consideration of issues such as Massive Urban Migration (MUM) that
requires infrastructure creation in an unprecedented scale for a transient
phenomenon. Such infrastructure include city social infrastructure such as
migrant worker hostels, women’s hostels, infrastructure for the elderly, crèches
and their accompanying regulatory framework and governmental institution
formulations. The presence of this kind of infrastructure will allow greater
unlocking of the economic potential of key segments of the population such as
migrant workers, women and young workers who have dependent elders.
The expected MUM will be of a scale that has not
been witnessed ever in the history of humankind and in the absence of city’s
upgrading to become Next Generation Cities, will lead to significant curtailment
of economic growth and considerable human misery. From an Indian perspective,
pressing issues such as social infrastructure, religious infrastructure,
regulatory frameworks for technology enabled safety, technology enabled
security, energy provisioning etc are of very high importance when designing the
Next Generation Cities.
Therefore, it is necessary to gear up the city
for issues such as religious infrastructure, disaster management, energy
consumption monitoring and other issues related to large scale infusion of a
diverse population. Again, in the absence of preparedness, one can expect social
problems leading to loss of economic productivity.
In order to support the smooth functioning of a
Next Generation City, it is essential to have Urban Analytics that will help in
all the above city management issues and help provide personalized governance to
the city’s businesses and people.
Issues such as social infrastructure,
religious infrastructure, regulatory frameworks for technology enabled safety,
technology enabled security, energy provisioning etc are of very high importance
when designing the Next Generation Cities in India
In addition, there are certain basic aspects of
city planning that is driven by the nature of industry that the city would like
to support. So, if a city has to support innovation industries or say IT/ITES
industry, it needs to have the infrastructure that would attract the set of
people who contribute to the creation of such industries. In the case of
IT/ITES, the city would need to cater to young people and their lifestyle and
expectations. That would mean the infrastructure planning has to be radically
different so that the right talent gets attracted which in turn would pull the
IT/ITES industry to the city. Overall, cities need open community spaces which
are generally lacking in Indian cities. These spaces contribute to the emotional
connect of the people to the city, which helps in individuals investing into the
city which in turn leads to higher economic activity.
Thus, a mere technology enablement of the Indian
cities would not suffice for the creation of Next Generation in Cities. We would
need to overhaul the administrative structure, bring in additional regulatory
frameworks and incorporate certain principles of city planning that are unique
to India and to perhaps some other fast growing economies.
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