SECOND DEATH ANNIVERSARY TO HOMAGE TO MAN OF STEEL
Justice Ashok Kumar Santiagu (1947-2009)
Justice Ashok Kumar Santiagu the retired high judge from Tamil Nadu and Andhra Pradesh died on 25th October 2009 at the age of 62. He retired on 17/06/2009.
He was born to teacher parents of Mallar - Devendra Kula Velalar, late Mr S Santiagu and late Mrs M Savariammal at Thenkalam Pudur, near Thaazhaiyuthu (Sankar Nagar – home town of India Cements) in Tirunelveli Dist on 20th July 1947. He was the first of the siblings with three sisters to follow.
His early primary education was done at the primary school at Thenkalam Pudur. For the students coming from downtrodden communities, the Christian Missionary Schools like, St Xavier’s High School, St John’s High School, Sara Tucker Girls High School, Mary Sargeant Girls High School, St Ignatius High School, Schafter High School, Cathedral High School were offering quality education at free or nominal cost. Accordingly, he continued his tertiary education at St Xavier’s High School Palayamkottai
Thereafter, he completed his Pre University Course (PUC) St Xavier’s College, Palayam kottai Tirunelveli Dist. He completed his degree course B Sc – Botany at St John’s College, Palaymkottai Tirunelveli Dist. Further, he completed his M Sc – Botany at St Joseph’s College, Trichy. Later he emulated his maternal uncle, M Muthiah , retired HOD Dept of Economics, Presidency College, Chennai presently Secretary St Xavier’s College Alumni Association, Palayam kottai, and studied Law at the Law College, Chennai.
He started his career in law as junior under Mr Chellapandian former Speaker of the Tamil Nadu Assembly. He earned his experience in crime cases from Mr Karuppiah another lawyer. Having served 15 years in Tirunelveli he emerged one of most promising lawyers among the lawyers as well as among his clients. His career as a lawyer came to an abrupt end in 1987 when he was directly appointed by none other than the former Chief Minister Dr M G Ramachandran himself as District Magistrate under Tamil Nadu Judicial Services.
He had served judge at the Special Court, Coimbatore after his initial training. Later he served in the District Courts of Dindigul, Tiruvannamalai, Cuddalore and Krishnagiri before his elevation as Judge of the Madras High Court in 2003. Later, he was transferred to High Court of Andhra Pradesh and finally retired on 17/07/2009.
Known for his vision to spread education among his community in Thenkalam pudur, Tirunelveli Dist, he was actively engaged in multifarious social activities. He had built a marriage hall in honour of his parents at Thenkalam Pudur Tirunelveli Dist.
Dedicated to his memory on the Second Death Anniversary on 25th Oct 2011
*****
Thursday, November 24, 2011
Tuesday, November 22, 2011
TRIBUTE TO REV DR R V MATHIAS
REV Dr R V MATHIAS
11th Nov 1938 to 17th Nov 2011
International YCW chaplain Fr RV Mathias died at 2.30a.m. in Trichy, India, following a massive heart attack. Fr Mathias was born in Edangani, Tamil Nadu on November 11, 1938.
He entered the seminary in 1953 andstudied at St Paul’s Seminary, India, from 1958-60. From 1960-64 he was a guest at the Pontifical Urban College in Rome followed by catechetical and liturgical studies at the Catholic Institute of Paris from 1964-66. He was ordained as a priest in Rome on 21 December 1963. Among the many positions he held, Fr Mathias was parish priest, diocesan, national and international chaplain of the YCW as well as chaplain of the diocesan youth and workers for the diocese of Trichy.
He was also Director of the Diocesan Pastoral Center, Executive Secretary of the CBCI Commission for Labor (Delhi), Vicar general of the diocese of Trichy. In 2002 he was appointed as Executive Secretary of the CBCI Commission for the laity. He taught at Karumathur Jesuit Theological College near Madurai, India until recently. After taking sabbatical leave, he was named spiritual father at St Paul’s Seminary, Tiruchirapalli in April 2011. Fr Mathias also collaborated actively with the Centre Lebret-IRFED network. The funeral will take place at 10 a.m. Friday at St. Paul’s Seminary, Trichy.
Tribute from CCI President
“We are shocked and saddened to hear of Fr Mathias’ passing,” said Stefan Gigacz “During his term as IYCW international chaplain, he worked tirelessly to maintain the unityof the movement. For this, we will be forever grateful.”
Tribute to a Progressive Priest !
I grew up in Ponmalai (Golden Rock) the Southern Railway workshop Town of Trichy where our neighbour in the railway quarters was late Sandanasamy elder brother of late Most Rev S T Amalanathar former Catholic Bishop of Tuticorin Tamil Nadu. Further late Mrs Kitheriammal spouse of late Sandanasamy was my mother late J D Savariammal’s (1929-2000) schoolmate at the St Philomena’s High School, Melapudur, Trichy. So it was natural for us to grow in the company of frequent visits by priests and nuns. Thus RV M was known to me. Little did I realize that after four decades later I would get an opportunity to collaborate with him to compile and publish “Impact of Globalization on the Working People” for the CWM regional Workshop in 2004.
A few months back I had met with him at the St Paul’s Theological College, Trichy during the Silver Jubilee of the Tamil Theological Association. At that time too he was rather looked famished and tired probably due to the hernia surgery he had undergone.
His death news really shocked me as he was only 73 years old. Most of his contribution was to the YCW at the Parish, Diocesan, National and international level. He was the chaplain who knew the ins and outs of the movement. He was very progressive among back in his diocese and had to incur the wrath of his orthodox ecclesial authorities for his non-conformist views on many issues. Even at the international level also he worked hard to prevent the ugly chasm developed in the movement between IYCW and YCWI. He commanded high respect from his contemporaries and admiration from his ex-YCW stalwarts and other progressive thinking religious and laity. His loss is irreparable to the Diocese, the Church and the thousands of his admirers.
True to his life of selfless service to the laity and the working class, he left a death wish – that he be buried as a commoner in a cemetery for laity and NOT in the cemetery for religious- a very rare death wish indeed to remain fresh in the minds of his followers, admirers and well wishers.
We thank the Lord for giving RV M to us the Tamil Catholic Church to be the Salt, light and beacon. Let’s thank the lord for the life and mission of RV M. Let us rededicate ourselves to the lofty ideals he left behind for us to follow. May his soul rest in peace and the eternal light shine upon him. We shall meet him on the beautiful shores one day in the presence of our savior and Lord Jesus.
I make the following appeal to the Bishop of Trichy, Rector St Paul’s Theological College, Trichy, the National YCW , the IYCW Brussels, Belgium and the CCI.
Let’s publish within a short period a souvenir for the life and times of RV M comprising his contributions to the Church, YCW, reminiscences from his childhood friends, relatives, siblings, bishops both local and international , religious, lay leaders and the people from every walk of life.
11th Nov 1938 to 17th Nov 2011
International YCW chaplain Fr RV Mathias died at 2.30a.m. in Trichy, India, following a massive heart attack. Fr Mathias was born in Edangani, Tamil Nadu on November 11, 1938.
He entered the seminary in 1953 andstudied at St Paul’s Seminary, India, from 1958-60. From 1960-64 he was a guest at the Pontifical Urban College in Rome followed by catechetical and liturgical studies at the Catholic Institute of Paris from 1964-66. He was ordained as a priest in Rome on 21 December 1963. Among the many positions he held, Fr Mathias was parish priest, diocesan, national and international chaplain of the YCW as well as chaplain of the diocesan youth and workers for the diocese of Trichy.
He was also Director of the Diocesan Pastoral Center, Executive Secretary of the CBCI Commission for Labor (Delhi), Vicar general of the diocese of Trichy. In 2002 he was appointed as Executive Secretary of the CBCI Commission for the laity. He taught at Karumathur Jesuit Theological College near Madurai, India until recently. After taking sabbatical leave, he was named spiritual father at St Paul’s Seminary, Tiruchirapalli in April 2011. Fr Mathias also collaborated actively with the Centre Lebret-IRFED network. The funeral will take place at 10 a.m. Friday at St. Paul’s Seminary, Trichy.
Tribute from CCI President
“We are shocked and saddened to hear of Fr Mathias’ passing,” said Stefan Gigacz “During his term as IYCW international chaplain, he worked tirelessly to maintain the unityof the movement. For this, we will be forever grateful.”
Tribute to a Progressive Priest !
I grew up in Ponmalai (Golden Rock) the Southern Railway workshop Town of Trichy where our neighbour in the railway quarters was late Sandanasamy elder brother of late Most Rev S T Amalanathar former Catholic Bishop of Tuticorin Tamil Nadu. Further late Mrs Kitheriammal spouse of late Sandanasamy was my mother late J D Savariammal’s (1929-2000) schoolmate at the St Philomena’s High School, Melapudur, Trichy. So it was natural for us to grow in the company of frequent visits by priests and nuns. Thus RV M was known to me. Little did I realize that after four decades later I would get an opportunity to collaborate with him to compile and publish “Impact of Globalization on the Working People” for the CWM regional Workshop in 2004.
A few months back I had met with him at the St Paul’s Theological College, Trichy during the Silver Jubilee of the Tamil Theological Association. At that time too he was rather looked famished and tired probably due to the hernia surgery he had undergone.
His death news really shocked me as he was only 73 years old. Most of his contribution was to the YCW at the Parish, Diocesan, National and international level. He was the chaplain who knew the ins and outs of the movement. He was very progressive among back in his diocese and had to incur the wrath of his orthodox ecclesial authorities for his non-conformist views on many issues. Even at the international level also he worked hard to prevent the ugly chasm developed in the movement between IYCW and YCWI. He commanded high respect from his contemporaries and admiration from his ex-YCW stalwarts and other progressive thinking religious and laity. His loss is irreparable to the Diocese, the Church and the thousands of his admirers.
True to his life of selfless service to the laity and the working class, he left a death wish – that he be buried as a commoner in a cemetery for laity and NOT in the cemetery for religious- a very rare death wish indeed to remain fresh in the minds of his followers, admirers and well wishers.
We thank the Lord for giving RV M to us the Tamil Catholic Church to be the Salt, light and beacon. Let’s thank the lord for the life and mission of RV M. Let us rededicate ourselves to the lofty ideals he left behind for us to follow. May his soul rest in peace and the eternal light shine upon him. We shall meet him on the beautiful shores one day in the presence of our savior and Lord Jesus.
I make the following appeal to the Bishop of Trichy, Rector St Paul’s Theological College, Trichy, the National YCW , the IYCW Brussels, Belgium and the CCI.
Let’s publish within a short period a souvenir for the life and times of RV M comprising his contributions to the Church, YCW, reminiscences from his childhood friends, relatives, siblings, bishops both local and international , religious, lay leaders and the people from every walk of life.
Friday, November 11, 2011
Minutes of 10th Year CALL MEET
The Minutes of the Tenth Annual Meeting of the Christian Association for Lay Leaders (CALL) on the 26th Oct 2011 at the Arch Diocesan Pastoral Centre, Santhome Chennai
THE TENTH GET TOGETHER ON 26th OCTOBER 2010
AT ARCH DIOCESAN PASTORAL CENTRE SANTHOME CHENNAI
The annual get together of Christian Association for Lay Leadership (CALL) was held on 26th Oct 2010 in Arch Diocesan Pastoral Centre Santhome, Chennai. The meeting formally started at 11.30 am with sharing of the one year experiences of those who had come for the meeting. The self introduction of the members followed. The following members were present: Rev M C Michael, Josephraj, Dheepam, Anthony Fernandez, Gnanaraj, Sara Christie, Armstrong, Alex, Kavaskar, Dr John Bosco, Women Wing President Catholic Union Dr Arul Jyothi and Sudha
The Following were invited: Auxilia Peter (Women’s Commission, Chennai), Sheila, Rosario, Xavier, Pauldoss, Jayaseelan, Rita,
Invited but Expressed Inability: Rita Tanjavur, Sheila, Rosario, Edward Tensing
Absented: Jayaseelan, Pauldoss, Xavier,
Gnanaraj explained the purpose and objectives of the gathering as envisaged in the first meet held ten years ago at Josephraj’s residence at Chengalpattu.
1. to share one year experiences, sorrows, agonies, victories, failures, ventures etc
2. to plan concretely where intervention can be made as individuals, as groups, as members of organizations, associations, movements
3. To revive and revitalize the link among the various catholic youth and workers organizations.
Further he recalled the tasks listed out in the earlier meeting held at Arch Diocesan Pastoral Centre Santhome, Chennai.
1. To help women entrepreneurs in consultation with Tamil Nadu Minorities Development Corporation Ltd, Chennai
2. To conduct education and career guidance for catholic youth at Vicariate level,
3. To help the catholic community to make use of internet as a source of income
4. To sustain, guide and animate youth movements like YCS/YSM, AICUF, YCW, DYC etc through dynamic and critical intervention.
The ball was set rolling by inviting Tony Fernandez on his foray in to body politics by launching Indhya Christhuva Makkal Katchi (Indian Christian People’s Party) a year ago, later by Armstrong on his involvement with Tamil Christhuva Viduthalai Iyakkam(Tamil Christian Liberation Movement), Thookku thandanaikku Ethirana Iyakkam (Movement to abolish Capital Punishment), Kavaskar from Idinthakarai on the Peoples Struggle against the Koodankulam Nuclear Power Plant in Tirunelveli Dist , Josephraj on his efforts to obtain Most Backward Classes - MBC status for all the Christians in Tamil Nadu, Gnanaraj’s visit to Bangkok, Thailand as YCS/AICUF delegate from India to the 10th anniversary of Cardijn Community International - CCI and General Assembly.
Tony was jubilant about his sharing of the experiences after launching the political outfit. He has realized that the mobilization of people within the church is not possible as both the church and the laity have not considered necessary. Having worked with the Diocesan Youth Commission, catholic renewal movement of india (CRMI), Catholic Union (AICU), Diocesan Laity Commission, National Biblical Catechetical Liturgical Commission (NBCLC) Bangalore and association with other youth groups like YCS, YCW, AICUF, CWM he has realized that creation of participatory structure within the church is still a pipe dream. However, having been trained to go out to the world to be salt of the earth by the Vatican II, he could not sit idle. There are a number of Christian political outfit already some with the overt blessing of the church some without any official support. Vazhvurimai Iyakkam and Kristhava Jananayaga Katchi are two examples for the former and latter. Still with long term plans the party was launched with Most Dr Rev A M Chinnappa SDB, Ph D the Arch Bishop of Madras-Mylapore and Most Rev Lawrence Pious Auxiliary Bishop of Madras-Mylapore. The response from the laity in Chennai area was overwhelming. Similarly, the response from other places like Puduchery, Trichy etc was also encouraging. However, some have objected to the new outfit as already some existing outfits are functioning with similar aims. Albeit the slight murmur, the group went on to contest in the local body elections in Tamil Nadu on the 17th October in some areas where the Christians are in a sizeable manner. A moderate presence is made and in particular, the support to the mayoral candidate of MDMK for Trichy made the candidate to the third position. Many candidates have won up to 200 votes in many areas. However, having forayed in to the new area, lots of lessons have to be learnt in the near future. The official church also backed out in the wake of criticism by many.
Josephraj intervened to suggest that the precautions to be taken to work as a political party, need some prominent person with sound financial background who can travel around with a small crowd to make impression of the existence of the party, a strong media coverage, regular programs to highlight the party etc. At the same time he shared the fact that except the Christian fisher folk no other Christian community enjoys the Most Backward Class status in the state. Hence, efforts are taken by him with his friends shortly to convene conference at Chennai to invite the ruling party ministers and CM to make a formal request to include all Christians in the MBC. He lamented that the church is taking a lot of efforts to impress the Central Govt to extend the benefits of the SC to Christian converts, has little paid attention to the above problem. Hence, we must move out of the church to achieve the needs of the community through political intervention.
Kavaskar from idinthakarai Tirunelveli has shared the background of the struggle of the people of his village against the koodankulam atomic Plant (KKAP). He stated that the danger level is high and the recent events in Fukushima, Japan has doubled the fears hence the overwhelming participation of the coastal people in the struggle. However, the public is not convinced that after a gap of two decades, after spending a colossal sum of Rs 10000 Crores the renewed struggle has not won any support from the public. Further, the Nadar community has openly supported the plant and accused the fisher folk of preventing the development of their community as well as the area. The direct involvement of the church including the bishop and clergy has further overshadowed the struggle. The state Govt has stopped with a resolution in the assembly to stop the work in the plant and has not further progressed. The dilemma of the protesters is how long the struggle can be extended and what would be the strategy to sustain the movement to internationalize the issue of nuclear hazard. It seems the Govt has not learnt any lesson, since the accident in the Three Mile Island (France), Chernobyl (Russia), Fukushima (Japan),
Armstrong shared his experience with the movement for abolition of capital punishment in India in the wake of the rejection of mercy petitions of the accused in the Rajiv Gandhi murder case by the President Of India and the Tamil Christians Liberation Movement in support of Internal displaced Tamils in Sri Lanka for early rehabilitation and resettlement in their homeland, taking up the war crimes against the President of Sri Lanka in the international forums including the International Court of Justice, he has been successful in organizing many meetings in favour of the Sri Lankan Tamils along with the like minded people including the students and staff from Arul Kadal, Foreshore Estate. For the abolition of capital punishment he has collaborated with various political outfits from MDMK, Communist Parties, Naam Tamizhar etc.
Gnanaraj Finally has shared the experience as the Indian delegate to the CCI Tenth Anniversary and General Assembly at Bangkok, Thailand. The meeting was attended by 45 delegates from Srilanka, Vietnam, Thailand, Malaysia, Singapore, Australia, Japan, Belgium, France, Kenya, Burma, Hong Kong, the Philippines, Indonesia and India held at the St Camillian Pastoral Care Centre, Lat Krabang, Bangkok, Thailand from 23rd to 25th July 2011. Rev Antoine sondang former chaplain IMCS/ICMICA delivered the key note address on “Peace Building Through Sustainable Development”. A notable participant was Charles Santiago former YCW and Civil society member now opposition MP in the Parliamen Klang Malaysia. Thereafter the country wise reports were presented to chalk out the future work. The cultural evening was held on the evening of 24th where every country delegates were asked to share the dance/song forms of their countries. The meeting elected the new international team of President, Secretary, Treasurer, Collaborators and Co-opted members. Translation of the works of Cardinal Cardijn in to various languages, celebration of the Golden Jubilee of the Vatican II, feast of Pentecost to be celebrated with like minded youth groups of the locality to ensure unity of purpose etc were some of the resolutions of the assembly.
Apart from the assembly, he shared his observation on Thailand.
The lunch was served at 2.00 pm. Thereafter the meeting continued till 3.30 pm with common sharing on the campaign against the nuclear energy and expressed that the group organized a one day fast along with like minded secular movements, parties, organizations like Physicians for Peace, Pennurimai Iyakkam, DYC, on the marina beach as early as 1988 on the wake of Chernobyl nuclear disaster in Russia. A note of thanks giving was given by Dheepam the host for the meet to everyone including M C Michael who despite his age and preoccupation at his school and parish, for having come to coordinate the meeting, Gnanaraj for sending SMS and contacts to make this meeting to happen and Tony Secretary, Arch Diocesan Laity Commission for having arranged the meeting hall and lunch. Another one year full of action by the members is wished to every one. May the Lord give us the strength and stamina and healthy life to carry on our campaigns and struggles and involvement.
(Gnanaraj T X)
Coordinator
x_g_raj@yahaoo.co.uk ,
Rev M C Michael 9865097601, Anthony Fernandez 9789978155, Josephraj 9443326295/27426295 Gnanaraj 9445393659 / 9445003794, Sara 9283228113, Sheila 9840997999, Armstrong 9445487103, Jeyaseelan 9841979928, Dheepam 9444330393, Paul Doss 9884249461, James Victor 9443131231, Rita Devanesan 9443710133, Rosario 9840251065, Tensingh 9444248879,
THE TENTH GET TOGETHER ON 26th OCTOBER 2010
AT ARCH DIOCESAN PASTORAL CENTRE SANTHOME CHENNAI
The annual get together of Christian Association for Lay Leadership (CALL) was held on 26th Oct 2010 in Arch Diocesan Pastoral Centre Santhome, Chennai. The meeting formally started at 11.30 am with sharing of the one year experiences of those who had come for the meeting. The self introduction of the members followed. The following members were present: Rev M C Michael, Josephraj, Dheepam, Anthony Fernandez, Gnanaraj, Sara Christie, Armstrong, Alex, Kavaskar, Dr John Bosco, Women Wing President Catholic Union Dr Arul Jyothi and Sudha
The Following were invited: Auxilia Peter (Women’s Commission, Chennai), Sheila, Rosario, Xavier, Pauldoss, Jayaseelan, Rita,
Invited but Expressed Inability: Rita Tanjavur, Sheila, Rosario, Edward Tensing
Absented: Jayaseelan, Pauldoss, Xavier,
Gnanaraj explained the purpose and objectives of the gathering as envisaged in the first meet held ten years ago at Josephraj’s residence at Chengalpattu.
1. to share one year experiences, sorrows, agonies, victories, failures, ventures etc
2. to plan concretely where intervention can be made as individuals, as groups, as members of organizations, associations, movements
3. To revive and revitalize the link among the various catholic youth and workers organizations.
Further he recalled the tasks listed out in the earlier meeting held at Arch Diocesan Pastoral Centre Santhome, Chennai.
1. To help women entrepreneurs in consultation with Tamil Nadu Minorities Development Corporation Ltd, Chennai
2. To conduct education and career guidance for catholic youth at Vicariate level,
3. To help the catholic community to make use of internet as a source of income
4. To sustain, guide and animate youth movements like YCS/YSM, AICUF, YCW, DYC etc through dynamic and critical intervention.
The ball was set rolling by inviting Tony Fernandez on his foray in to body politics by launching Indhya Christhuva Makkal Katchi (Indian Christian People’s Party) a year ago, later by Armstrong on his involvement with Tamil Christhuva Viduthalai Iyakkam(Tamil Christian Liberation Movement), Thookku thandanaikku Ethirana Iyakkam (Movement to abolish Capital Punishment), Kavaskar from Idinthakarai on the Peoples Struggle against the Koodankulam Nuclear Power Plant in Tirunelveli Dist , Josephraj on his efforts to obtain Most Backward Classes - MBC status for all the Christians in Tamil Nadu, Gnanaraj’s visit to Bangkok, Thailand as YCS/AICUF delegate from India to the 10th anniversary of Cardijn Community International - CCI and General Assembly.
Tony was jubilant about his sharing of the experiences after launching the political outfit. He has realized that the mobilization of people within the church is not possible as both the church and the laity have not considered necessary. Having worked with the Diocesan Youth Commission, catholic renewal movement of india (CRMI), Catholic Union (AICU), Diocesan Laity Commission, National Biblical Catechetical Liturgical Commission (NBCLC) Bangalore and association with other youth groups like YCS, YCW, AICUF, CWM he has realized that creation of participatory structure within the church is still a pipe dream. However, having been trained to go out to the world to be salt of the earth by the Vatican II, he could not sit idle. There are a number of Christian political outfit already some with the overt blessing of the church some without any official support. Vazhvurimai Iyakkam and Kristhava Jananayaga Katchi are two examples for the former and latter. Still with long term plans the party was launched with Most Dr Rev A M Chinnappa SDB, Ph D the Arch Bishop of Madras-Mylapore and Most Rev Lawrence Pious Auxiliary Bishop of Madras-Mylapore. The response from the laity in Chennai area was overwhelming. Similarly, the response from other places like Puduchery, Trichy etc was also encouraging. However, some have objected to the new outfit as already some existing outfits are functioning with similar aims. Albeit the slight murmur, the group went on to contest in the local body elections in Tamil Nadu on the 17th October in some areas where the Christians are in a sizeable manner. A moderate presence is made and in particular, the support to the mayoral candidate of MDMK for Trichy made the candidate to the third position. Many candidates have won up to 200 votes in many areas. However, having forayed in to the new area, lots of lessons have to be learnt in the near future. The official church also backed out in the wake of criticism by many.
Josephraj intervened to suggest that the precautions to be taken to work as a political party, need some prominent person with sound financial background who can travel around with a small crowd to make impression of the existence of the party, a strong media coverage, regular programs to highlight the party etc. At the same time he shared the fact that except the Christian fisher folk no other Christian community enjoys the Most Backward Class status in the state. Hence, efforts are taken by him with his friends shortly to convene conference at Chennai to invite the ruling party ministers and CM to make a formal request to include all Christians in the MBC. He lamented that the church is taking a lot of efforts to impress the Central Govt to extend the benefits of the SC to Christian converts, has little paid attention to the above problem. Hence, we must move out of the church to achieve the needs of the community through political intervention.
Kavaskar from idinthakarai Tirunelveli has shared the background of the struggle of the people of his village against the koodankulam atomic Plant (KKAP). He stated that the danger level is high and the recent events in Fukushima, Japan has doubled the fears hence the overwhelming participation of the coastal people in the struggle. However, the public is not convinced that after a gap of two decades, after spending a colossal sum of Rs 10000 Crores the renewed struggle has not won any support from the public. Further, the Nadar community has openly supported the plant and accused the fisher folk of preventing the development of their community as well as the area. The direct involvement of the church including the bishop and clergy has further overshadowed the struggle. The state Govt has stopped with a resolution in the assembly to stop the work in the plant and has not further progressed. The dilemma of the protesters is how long the struggle can be extended and what would be the strategy to sustain the movement to internationalize the issue of nuclear hazard. It seems the Govt has not learnt any lesson, since the accident in the Three Mile Island (France), Chernobyl (Russia), Fukushima (Japan),
Armstrong shared his experience with the movement for abolition of capital punishment in India in the wake of the rejection of mercy petitions of the accused in the Rajiv Gandhi murder case by the President Of India and the Tamil Christians Liberation Movement in support of Internal displaced Tamils in Sri Lanka for early rehabilitation and resettlement in their homeland, taking up the war crimes against the President of Sri Lanka in the international forums including the International Court of Justice, he has been successful in organizing many meetings in favour of the Sri Lankan Tamils along with the like minded people including the students and staff from Arul Kadal, Foreshore Estate. For the abolition of capital punishment he has collaborated with various political outfits from MDMK, Communist Parties, Naam Tamizhar etc.
Gnanaraj Finally has shared the experience as the Indian delegate to the CCI Tenth Anniversary and General Assembly at Bangkok, Thailand. The meeting was attended by 45 delegates from Srilanka, Vietnam, Thailand, Malaysia, Singapore, Australia, Japan, Belgium, France, Kenya, Burma, Hong Kong, the Philippines, Indonesia and India held at the St Camillian Pastoral Care Centre, Lat Krabang, Bangkok, Thailand from 23rd to 25th July 2011. Rev Antoine sondang former chaplain IMCS/ICMICA delivered the key note address on “Peace Building Through Sustainable Development”. A notable participant was Charles Santiago former YCW and Civil society member now opposition MP in the Parliamen Klang Malaysia. Thereafter the country wise reports were presented to chalk out the future work. The cultural evening was held on the evening of 24th where every country delegates were asked to share the dance/song forms of their countries. The meeting elected the new international team of President, Secretary, Treasurer, Collaborators and Co-opted members. Translation of the works of Cardinal Cardijn in to various languages, celebration of the Golden Jubilee of the Vatican II, feast of Pentecost to be celebrated with like minded youth groups of the locality to ensure unity of purpose etc were some of the resolutions of the assembly.
Apart from the assembly, he shared his observation on Thailand.
The lunch was served at 2.00 pm. Thereafter the meeting continued till 3.30 pm with common sharing on the campaign against the nuclear energy and expressed that the group organized a one day fast along with like minded secular movements, parties, organizations like Physicians for Peace, Pennurimai Iyakkam, DYC, on the marina beach as early as 1988 on the wake of Chernobyl nuclear disaster in Russia. A note of thanks giving was given by Dheepam the host for the meet to everyone including M C Michael who despite his age and preoccupation at his school and parish, for having come to coordinate the meeting, Gnanaraj for sending SMS and contacts to make this meeting to happen and Tony Secretary, Arch Diocesan Laity Commission for having arranged the meeting hall and lunch. Another one year full of action by the members is wished to every one. May the Lord give us the strength and stamina and healthy life to carry on our campaigns and struggles and involvement.
(Gnanaraj T X)
Coordinator
x_g_raj@yahaoo.co.uk ,
Rev M C Michael 9865097601, Anthony Fernandez 9789978155, Josephraj 9443326295/27426295 Gnanaraj 9445393659 / 9445003794, Sara 9283228113, Sheila 9840997999, Armstrong 9445487103, Jeyaseelan 9841979928, Dheepam 9444330393, Paul Doss 9884249461, James Victor 9443131231, Rita Devanesan 9443710133, Rosario 9840251065, Tensingh 9444248879,
Tuesday, July 12, 2011
AAO QUESTION PAPER 2009
2009
SOUTHERN RAILWAY
EXAMINATION FOR SELECTION FOR THE POST OF ASSISTANT FINANCIAL ADVISERS
(70 PERCENT QUOTA)
Time: 3 hours 19th February 2009 Max Marks 150
INSTRUCTIONS TO THE CANDIDATES
Do not write your Roll No or name anywhere in the Answer Book. Only the Roll No should be written on the top sheet in the space provided.
NOTE 1. Answer any five questions. All questions carry equal marks
The marks for each sub-section are indicated in the brackets
2. All questions have two sub-sections – (a) & (b)
Candidates must answer both (a) & (b) of each questions attempted, to qualify for marks. For example if Q 1 is attempted then both (a) & (b) of Q1 must be answered to get the benefit of full evaluation of 30 marks as allotted to the whole question.
Answer any five questions (15 marks)
Q 1. (a) What do you understand by inter-railway and intra-railway transactions? How are such transactions proposed, accepted, adjusted and reconciled?
(15 marks)
(b) Do you think that the preparation of two accounts current – Approximate and Actual are necessary? Explain in detail
(15 marks)
Q 2 (a) What is a “Works Programme”? What are the various steps involved in its finalisaiton
(15 marks)
(b) Discuss “Pink Book”. “Orange Book” and ‘Divisional Works Programme’
Q 3 (a) Write Short notes on any Five (15 marks each 3 marks)
i. Traffic Suspense
ii. Admitted debits and disputed debits
iii. Draft para and provisional para
iv. Material modification
v. Stock adjustment account
vi. Single tender and limited tender
vii. “global meltdown”
(15 marks)
(b) What do you understand by Inventory Control? What is ABC analysis and its advantages?
(15 marks)
Q 4 (a) What is meant by Apportionment of Earnings? How is it done in respect of Goods Earnings of Through Traffic?
(15 marks)
(b) What is “Zero Based Budget”? How can this be made applicable for Revenue Budget?
Q5 (a) distinguish between the following (any three)
(15 marks – each 5)
i. Fall Clause and Option Clauses
ii. Zonal Tender and Bulletin Tender
iii. Purchase Preference and Price Preference
iv. Development Fund I & II
(15 marks)
(b) What are the Objectives of Budgetary Controls? Discuss the various Budgetary Reviews.
Q 6 (a) What is meant by Productivity Test? Do they serve any purpose?
(15 marks)
(b) What is “Operating Ratio”? Is it a fair Index to assess a Railway’s Performance? How can we improve upon the “Operating Ratio” of Southern Railway?
(15 marks)
Q! 7 (a) What is Stock Verification? How is the Stock Sheet prepared and finalised?
(15 marks)
(b) What are the various heads under “Purchase Suspense”? Give your suggestions for maintain this “Suspense” efficiently and currently?
(15 marks)
Q 8 (a) What is meant by Exchequer Control? In addition to Budget allotments, Demand and Primary Unit –wise-Why is Exchequer Control still necessary?
(15 marks)
(b) What are the various kinds of leave an employee is entitled to? When can leave been encahsed?
(15 marks)
Q9 (a) Discuss the salient features of the Official Languages Act 1963. Suggest steps for promoting Rajbhasha in southern railway.
(15 marks)
(b) How would you inspect an Executive Office? What are the objectives? Give suggestions for improving it.
(15 marks)
Q10 (a) Elaborate on the significance of “Cheques and Bills” reconciliation How can computerisation help in this area?
(15 marks)
(b) Discuss the merits and demerits of the Incentive Scheme on Railway Workshop
((((((((((((((((((@)))))))))))))))))))
SOUTHERN RAILWAY
EXAMINATION FOR SELECTION FOR THE POST OF ASSISTANT FINANCIAL ADVISERS
(70 PERCENT QUOTA)
Time: 3 hours 19th February 2009 Max Marks 150
INSTRUCTIONS TO THE CANDIDATES
Do not write your Roll No or name anywhere in the Answer Book. Only the Roll No should be written on the top sheet in the space provided.
NOTE 1. Answer any five questions. All questions carry equal marks
The marks for each sub-section are indicated in the brackets
2. All questions have two sub-sections – (a) & (b)
Candidates must answer both (a) & (b) of each questions attempted, to qualify for marks. For example if Q 1 is attempted then both (a) & (b) of Q1 must be answered to get the benefit of full evaluation of 30 marks as allotted to the whole question.
Answer any five questions (15 marks)
Q 1. (a) What do you understand by inter-railway and intra-railway transactions? How are such transactions proposed, accepted, adjusted and reconciled?
(15 marks)
(b) Do you think that the preparation of two accounts current – Approximate and Actual are necessary? Explain in detail
(15 marks)
Q 2 (a) What is a “Works Programme”? What are the various steps involved in its finalisaiton
(15 marks)
(b) Discuss “Pink Book”. “Orange Book” and ‘Divisional Works Programme’
Q 3 (a) Write Short notes on any Five (15 marks each 3 marks)
i. Traffic Suspense
ii. Admitted debits and disputed debits
iii. Draft para and provisional para
iv. Material modification
v. Stock adjustment account
vi. Single tender and limited tender
vii. “global meltdown”
(15 marks)
(b) What do you understand by Inventory Control? What is ABC analysis and its advantages?
(15 marks)
Q 4 (a) What is meant by Apportionment of Earnings? How is it done in respect of Goods Earnings of Through Traffic?
(15 marks)
(b) What is “Zero Based Budget”? How can this be made applicable for Revenue Budget?
Q5 (a) distinguish between the following (any three)
(15 marks – each 5)
i. Fall Clause and Option Clauses
ii. Zonal Tender and Bulletin Tender
iii. Purchase Preference and Price Preference
iv. Development Fund I & II
(15 marks)
(b) What are the Objectives of Budgetary Controls? Discuss the various Budgetary Reviews.
Q 6 (a) What is meant by Productivity Test? Do they serve any purpose?
(15 marks)
(b) What is “Operating Ratio”? Is it a fair Index to assess a Railway’s Performance? How can we improve upon the “Operating Ratio” of Southern Railway?
(15 marks)
Q! 7 (a) What is Stock Verification? How is the Stock Sheet prepared and finalised?
(15 marks)
(b) What are the various heads under “Purchase Suspense”? Give your suggestions for maintain this “Suspense” efficiently and currently?
(15 marks)
Q 8 (a) What is meant by Exchequer Control? In addition to Budget allotments, Demand and Primary Unit –wise-Why is Exchequer Control still necessary?
(15 marks)
(b) What are the various kinds of leave an employee is entitled to? When can leave been encahsed?
(15 marks)
Q9 (a) Discuss the salient features of the Official Languages Act 1963. Suggest steps for promoting Rajbhasha in southern railway.
(15 marks)
(b) How would you inspect an Executive Office? What are the objectives? Give suggestions for improving it.
(15 marks)
Q10 (a) Elaborate on the significance of “Cheques and Bills” reconciliation How can computerisation help in this area?
(15 marks)
(b) Discuss the merits and demerits of the Incentive Scheme on Railway Workshop
((((((((((((((((((@)))))))))))))))))))
AAO QUESTION PAPER 2010
2010
SOUTHERN RAILWAY
EXAMINATION FOR SELECTION FOR THE POST OF ASSISTANT FINANCIAL ADVISER
(70 PERCENT QUOTA)
Time: 3 hours 18th August 2010 Max Marks 150
SECTION- A
Answer in one word 8 x 2 = 16 Marks
a) The Suspense Head use to book expenditure the allocation of which is not known is_____
b) Wages not paid to staff within the stipulated period are taken to ________________________ of Unpaid Wages Account
c) In Railway Accounting ____________________________ sets of journal are maintained
d) All Transfer Transactions between railways are adjusted through ______________________
e) Interest on account of loans and advances is credited to Railway Board through _______________
f) The register maintained in accounts office to ensure that appointments are not made in excess of post sanctioned is known as ____________________ register
g) Estimate of Expenditure which is not submitted to vote of parliament known as _________________expenditure
h) Expenditure on track circuiting is charged to ____________________________
i) Cost of manufacturing of section of line not opened for traffic is charged to ________________
j) When railway land is lost through erosion, cost of the same is written back from capital to ______________
SECTION B
Identify the correct choice 7 x 2 = 14 Marks
Answer any seven
a) Bulk of southern railways apportioned earnings are generated through - Passenger/Goods traffic
b) In Appropriation Accounts expiations are furnished for variation between original grant and actual expenditure (correct / incorrect)
c) Block Account represents all physical assets of railways financed from loan capital and railway’s own generation funds ( correct / incorrect)
d) Tender received after the specified time of opening is known as – delayed tender / late tender
e) Railway pensioners are required to submit a life certificate once in a year / once in two years
f) The object of maintaining an Abstract Of Bills passed in Accounts Office is to reduce the number of cheques drawn everyday/ to issue more cheques of smaller value
g) The payment received by a railway employee while under suspension is known as subsistence allowance / compassionate pay
h) Leave on Average Pay is credited to the loan account of railway employee at the rate of 2 ½ / 3 days for each calendar month of service
i) Leave granted for railway employee under medical treatment for injures sustained in the course of official duties is known as accident leave / hospital leave
j) receipts from forfeited Provident Fund loans is credited to Railway Earnings / Staff Benefit Fund
SECTION - C
Answer any two 2 x 10 = 20 marks
a) Originating Earnings and Apportioned Earnings
b) Travelling Allowance and Transfer Grant
c) Voted Expenditure and Charged Expenditure
d) Group Incentive Scheme and CLW pattern of workshop incentive
e) Rate Contract and Running contract
SECTION – D
Write short notes answer any two questions 2 x 10 = marks
a) Inventory turn over ratio
b) Traffic book
c) Material modification
d) Workshop general register
e) Proforma on cost
SECTION – E
Answer any five questions 5 x 16 = 80 marks
a) What is known as the official language policy of the Govt? How is its implementation mentioned? 8 + 8 = 16 marks
b) What is the impact of 6th Pay Commission on the operating ratio of southern railway? How the operating ratio can be brought down? 8 + 8 = 16 marks
c) What are the different types of estimates prepared for execution of works? What are the points that are verified in accounts office while certifying the estimate 8 + 8 = 16 marks
d) What are the different types of tenders that are used to execute a work in the railways? What are the modifications effected to general conditions of contract at recent years 8 + 8 = 16 marks
e) What are the major sources of earnings for Indian railways? What are the steps that could be taken to improve the sundry earnings in Southern Railway?
f) What are the various stages of budget review followed in railways? What is the mechanism to ensure that the revenue expenditure is regulated with references to budget grant? 8 + 8 = 16 marks
g) What is the methodology adopted in the Internal Check of Establishment claims? How can we make our internal check mechanism more effective? 8 + 8 = 16 marks
h) How the Revenue Accounts is current compiled in Accounts Office every month? Detail the procedure followed in compilation and the annexures that are generated? 8 + 8 = 16 marks
i) What are the various suspense heads that are operated in the railways? What is the need to operate them? 8 + 8 = 16 marks
SOUTHERN RAILWAY
EXAMINATION FOR SELECTION FOR THE POST OF ASSISTANT FINANCIAL ADVISER
(70 PERCENT QUOTA)
Time: 3 hours 18th August 2010 Max Marks 150
SECTION- A
Answer in one word 8 x 2 = 16 Marks
a) The Suspense Head use to book expenditure the allocation of which is not known is_____
b) Wages not paid to staff within the stipulated period are taken to ________________________ of Unpaid Wages Account
c) In Railway Accounting ____________________________ sets of journal are maintained
d) All Transfer Transactions between railways are adjusted through ______________________
e) Interest on account of loans and advances is credited to Railway Board through _______________
f) The register maintained in accounts office to ensure that appointments are not made in excess of post sanctioned is known as ____________________ register
g) Estimate of Expenditure which is not submitted to vote of parliament known as _________________expenditure
h) Expenditure on track circuiting is charged to ____________________________
i) Cost of manufacturing of section of line not opened for traffic is charged to ________________
j) When railway land is lost through erosion, cost of the same is written back from capital to ______________
SECTION B
Identify the correct choice 7 x 2 = 14 Marks
Answer any seven
a) Bulk of southern railways apportioned earnings are generated through - Passenger/Goods traffic
b) In Appropriation Accounts expiations are furnished for variation between original grant and actual expenditure (correct / incorrect)
c) Block Account represents all physical assets of railways financed from loan capital and railway’s own generation funds ( correct / incorrect)
d) Tender received after the specified time of opening is known as – delayed tender / late tender
e) Railway pensioners are required to submit a life certificate once in a year / once in two years
f) The object of maintaining an Abstract Of Bills passed in Accounts Office is to reduce the number of cheques drawn everyday/ to issue more cheques of smaller value
g) The payment received by a railway employee while under suspension is known as subsistence allowance / compassionate pay
h) Leave on Average Pay is credited to the loan account of railway employee at the rate of 2 ½ / 3 days for each calendar month of service
i) Leave granted for railway employee under medical treatment for injures sustained in the course of official duties is known as accident leave / hospital leave
j) receipts from forfeited Provident Fund loans is credited to Railway Earnings / Staff Benefit Fund
SECTION - C
Answer any two 2 x 10 = 20 marks
a) Originating Earnings and Apportioned Earnings
b) Travelling Allowance and Transfer Grant
c) Voted Expenditure and Charged Expenditure
d) Group Incentive Scheme and CLW pattern of workshop incentive
e) Rate Contract and Running contract
SECTION – D
Write short notes answer any two questions 2 x 10 = marks
a) Inventory turn over ratio
b) Traffic book
c) Material modification
d) Workshop general register
e) Proforma on cost
SECTION – E
Answer any five questions 5 x 16 = 80 marks
a) What is known as the official language policy of the Govt? How is its implementation mentioned? 8 + 8 = 16 marks
b) What is the impact of 6th Pay Commission on the operating ratio of southern railway? How the operating ratio can be brought down? 8 + 8 = 16 marks
c) What are the different types of estimates prepared for execution of works? What are the points that are verified in accounts office while certifying the estimate 8 + 8 = 16 marks
d) What are the different types of tenders that are used to execute a work in the railways? What are the modifications effected to general conditions of contract at recent years 8 + 8 = 16 marks
e) What are the major sources of earnings for Indian railways? What are the steps that could be taken to improve the sundry earnings in Southern Railway?
f) What are the various stages of budget review followed in railways? What is the mechanism to ensure that the revenue expenditure is regulated with references to budget grant? 8 + 8 = 16 marks
g) What is the methodology adopted in the Internal Check of Establishment claims? How can we make our internal check mechanism more effective? 8 + 8 = 16 marks
h) How the Revenue Accounts is current compiled in Accounts Office every month? Detail the procedure followed in compilation and the annexures that are generated? 8 + 8 = 16 marks
i) What are the various suspense heads that are operated in the railways? What is the need to operate them? 8 + 8 = 16 marks
Saturday, July 09, 2011
AAO EXAM QUESTIONS 2008
2008
SOUTHERN RAILWAY
Examination for Selection for the post of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 23rd January 2008 Max Marks 150
Note 1. THE QUESTION PAPER CONSISTS OF FOUR SECTIONS. SECTION-A CARRIES 15 MARKS, SECTION-B CARRY 10 MARKS. ALL THE QUESTIONS ARE TO BE ANSWERED IN THESE TWO SECTIONS
2. SECTION-C CARRIES CONSISTS OF TWO QUESTINS
3. SECTION –D CARRIES 82 MARKS CONSISTS OF 7 QUESTIONS OUT OF WHICH FOUR HAVE TO BE ANSWERED. EACH QUESTION CARRIES 20 MARKS
SECTION - A 3 x 5 = 15
Explain whether the following are TRUE or FALSE giving reasons
Financial performance is judged by wagon turn around
arbitration awards are to be treated as charged expenditure
General Managers have full powers to waive profit and departmental charges in respect of deposit work of a central Government organisation
the value realised from scrap sales is allocated to sundry earnings
a tender submitted after the opening date of a tender can be considered if it is financially advantageous to railways
SECTION B 2 x 5 = 10
I Identify the correct choice
a. expenditure which cannot be anticipated is met through Consolidated Fund of India/ Contingency Fund of India
b. transaction between railways and other ministries is known as Transfer Transactions/ Remittance Transactions
c. freight on material transported by a train for a deposit work executed by the railway is credited to Abstract Y / Abstract Z
d. postal haulage charges are computed on berth replacement / seat replacement
e. the index of fuel efficiency is SFC / O R
SECTION –C 4 x 5 = 20
1 ) Distinguish any FOUR of the following
a. Special Railway Safety Fund and Development Fund
b. Originating Earnings and Apportioned Earnings
c. M&P Programme and Works Programme
d. Bills Receivables and Bills Payable
e. IRCA and IRFA adjustments
f. Stock Adjustment Account and Stores in Transit account
g. Fall Clause and Option Clause
2) Write short note on any FIVE of the following 5 x 5 = 25
a. Traffic Book
b. Inventory Turn over Ratio
c. P E Index
d. PRIME and AFRES
e. Official Language Policy
f. Internal Rate of Return
g. Material Modification
SECTION D
Answer any FOUR of the following 4 x 20 = 80
1. What are the reasons for the operating ratio of Southern Railway exceeding 100? Is it healthy or inescapable? If it is not acceptable level, what are your suggestions for bringing it down below 100
2. What is the process for preparing the revenue and expenditure budget on Southern Railway? What are the various stages of Budgetary Review? Also discuss about the adoption of Zero Based Budgeting Techniques.
3. What are the major points of justification for electrification of existing Broad Gauge line between station A and Station B. what are the checks to be exercised by Finance when such a proposal is received for inclusion in PWP?
4. “Control of inventory is the effective way to control expenditure”. In the light of this, describe the inventory control mechanism on railways right from indenting stage through procurement, storage, issue and disposal?
5. What is traffic suspense? What are its constituent items? What steps you would suggest to reduce traffic suspense to the minimum?
6. Explain in detail the Costing System adopted in Southern Railways Repair Workshops? In what way it differs from the system of Production Units. Can you suggest any improvement on this?
7. Describe the various sources of funding for Railway Projects. Describe what the alternative sources of finance are. What do you understand by Pubic-Private-Partnership.PPP)
SOUTHERN RAILWAY
Examination for Selection for the post of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 23rd January 2008 Max Marks 150
Note 1. THE QUESTION PAPER CONSISTS OF FOUR SECTIONS. SECTION-A CARRIES 15 MARKS, SECTION-B CARRY 10 MARKS. ALL THE QUESTIONS ARE TO BE ANSWERED IN THESE TWO SECTIONS
2. SECTION-C CARRIES CONSISTS OF TWO QUESTINS
3. SECTION –D CARRIES 82 MARKS CONSISTS OF 7 QUESTIONS OUT OF WHICH FOUR HAVE TO BE ANSWERED. EACH QUESTION CARRIES 20 MARKS
SECTION - A 3 x 5 = 15
Explain whether the following are TRUE or FALSE giving reasons
Financial performance is judged by wagon turn around
arbitration awards are to be treated as charged expenditure
General Managers have full powers to waive profit and departmental charges in respect of deposit work of a central Government organisation
the value realised from scrap sales is allocated to sundry earnings
a tender submitted after the opening date of a tender can be considered if it is financially advantageous to railways
SECTION B 2 x 5 = 10
I Identify the correct choice
a. expenditure which cannot be anticipated is met through Consolidated Fund of India/ Contingency Fund of India
b. transaction between railways and other ministries is known as Transfer Transactions/ Remittance Transactions
c. freight on material transported by a train for a deposit work executed by the railway is credited to Abstract Y / Abstract Z
d. postal haulage charges are computed on berth replacement / seat replacement
e. the index of fuel efficiency is SFC / O R
SECTION –C 4 x 5 = 20
1 ) Distinguish any FOUR of the following
a. Special Railway Safety Fund and Development Fund
b. Originating Earnings and Apportioned Earnings
c. M&P Programme and Works Programme
d. Bills Receivables and Bills Payable
e. IRCA and IRFA adjustments
f. Stock Adjustment Account and Stores in Transit account
g. Fall Clause and Option Clause
2) Write short note on any FIVE of the following 5 x 5 = 25
a. Traffic Book
b. Inventory Turn over Ratio
c. P E Index
d. PRIME and AFRES
e. Official Language Policy
f. Internal Rate of Return
g. Material Modification
SECTION D
Answer any FOUR of the following 4 x 20 = 80
1. What are the reasons for the operating ratio of Southern Railway exceeding 100? Is it healthy or inescapable? If it is not acceptable level, what are your suggestions for bringing it down below 100
2. What is the process for preparing the revenue and expenditure budget on Southern Railway? What are the various stages of Budgetary Review? Also discuss about the adoption of Zero Based Budgeting Techniques.
3. What are the major points of justification for electrification of existing Broad Gauge line between station A and Station B. what are the checks to be exercised by Finance when such a proposal is received for inclusion in PWP?
4. “Control of inventory is the effective way to control expenditure”. In the light of this, describe the inventory control mechanism on railways right from indenting stage through procurement, storage, issue and disposal?
5. What is traffic suspense? What are its constituent items? What steps you would suggest to reduce traffic suspense to the minimum?
6. Explain in detail the Costing System adopted in Southern Railways Repair Workshops? In what way it differs from the system of Production Units. Can you suggest any improvement on this?
7. Describe the various sources of funding for Railway Projects. Describe what the alternative sources of finance are. What do you understand by Pubic-Private-Partnership.PPP)
AAO EXAM QUESTIONS 2005
2005
SOUTHERN RAILWAY
Examination for Selection for the post of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 5th January 2005 Max Marks 150
Note 1. THE QUESTION PAPER CONSISTS OF FOUR SECTIONS. SECTION-A AND SECTION-B CARRY 24 MARKS EACH, SECTION-C CARRIES 20 MARKS AND SECTION –D CARRIES 82 MARKS
2. ALL QUESTIONS IN SECTIONS – A , B AND C ARE COMPULSORY
3. IN SECTION –D ANSWER ANY FOUR QUESTIONS, ALL OF WHICH CARRY EQUAL MARKS
SECTION - A 8 x 3 = 24 Marks
Explain whether the following are TRUE or FALSE giving reasons and explaining the correct position.
General Manager has no power to authorise SAG officers to travel by Private Airlines
Arbitration awards under Arbitration Act 1996 can be contested in a Court Of Law
Works and Stores tenders cannot be awarded to a party other than the lowest (L-1)
National Holiday Allowance is payable to eligible staff for the three National Holidays only
Dividend payable on Capital invested in Residential Buildings is less that the Capital invested in Track
FReight on material transported by train for a Deposit Work executed by the Railway is credited to Abstract – Y
Accident Compensation, Safety and Passenger Amenities Fund has been abolished
City Compensatory Allowance is not include for Leave Salary Encashment at the time of retirement
SECTION B 8 x 3 = 24 Marks
How will you deal with the following situation?
After opening of the tenders, one of the tenderers offers a discount
wagons weighed enroute are found to carry excess weight beyond the permissile limits
ex-gratia payment has been sanctioned by GM to railway employees affected by Tsunami
central railway refuses to accept IRFA debits on the plea that I is not an adjacent railway of southern railway
a PHOD asks the administration to pay the entire amount of Rs 2000/- in December 2004 for his mobile phone provided by the railway
a special pay sheet is lost by the cashier before payment has been made
you have detected a fraud of aout Rs 50000/- while inspecting a booking office
after opening of the tenders, the lowest tenderer expresses inability to carry out his work
SECTION- C 5 x 4 = 20 Marks
Distinguish between ANY FIVE of the following
1. Special Railway Safety Fund and Railway Safety Fund
2. PLB and Incentive Bonus
3. PEI and Operating Ratio
4. Gross Traffic Receipts and Gross Earnings
5. Single Tender and Single Offer
6. Pink Book and Green Book
7. Vote-On-Account and Voted Expenditure
SECTION – D 82 Marks
FIRST QUESTION IS COMPULSORY AND CARRIES 22 MARKS ANSWER ANY THREE OF THE REMAINING EACH OF WHICH CARRIES 20 MARKS
The three major achievements of the Accounts Department in the last 50 years are Computerisation in the 60s, Revised Classification in the 70s and FMIS in the 90s. Elaborate on the statement
OR
What are the major points of justification for provision of the 5th and 6th line between Chennai Central and Arakkonam. What are the points to be examined in Finance when such a proposal is received for inclusion in PWP?
What are the salient features of accounting followed in Southern Railway for reserved ticketing and in reserved ticketing in passenger traffic? What are your suggestions for improvement in both areas?
Elaborate the present system of accountal of Pension Payments. What are your suggestions for improving the same?
What are the important recommendations of Sudhir Chandra Committee? What changes are necessary in the present system of project management as far as Accounts Department is concerned?
What is the Official Language Policy followed in the railways? List out the documents which must be bilingual under section 3(3) of the Act. Give the Hindi equivalent for FA&CAO, Senior AFA and FC (Railways)
What are the various ways in which Railway Projects are financed? Explain the special features of financing followed in MRTS projects
elaborate on the system of Inventory Control followed in Railways with special emphasis on the role of Accounts Department
‘operating ratio is a good indicator of the financial health of a railway’, elaborated\ on this statement, what are your suggestions to bring down the operating ratio of Southern Railway to less than 100 % in the next five years
SOUTHERN RAILWAY
Examination for Selection for the post of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 5th January 2005 Max Marks 150
Note 1. THE QUESTION PAPER CONSISTS OF FOUR SECTIONS. SECTION-A AND SECTION-B CARRY 24 MARKS EACH, SECTION-C CARRIES 20 MARKS AND SECTION –D CARRIES 82 MARKS
2. ALL QUESTIONS IN SECTIONS – A , B AND C ARE COMPULSORY
3. IN SECTION –D ANSWER ANY FOUR QUESTIONS, ALL OF WHICH CARRY EQUAL MARKS
SECTION - A 8 x 3 = 24 Marks
Explain whether the following are TRUE or FALSE giving reasons and explaining the correct position.
General Manager has no power to authorise SAG officers to travel by Private Airlines
Arbitration awards under Arbitration Act 1996 can be contested in a Court Of Law
Works and Stores tenders cannot be awarded to a party other than the lowest (L-1)
National Holiday Allowance is payable to eligible staff for the three National Holidays only
Dividend payable on Capital invested in Residential Buildings is less that the Capital invested in Track
FReight on material transported by train for a Deposit Work executed by the Railway is credited to Abstract – Y
Accident Compensation, Safety and Passenger Amenities Fund has been abolished
City Compensatory Allowance is not include for Leave Salary Encashment at the time of retirement
SECTION B 8 x 3 = 24 Marks
How will you deal with the following situation?
After opening of the tenders, one of the tenderers offers a discount
wagons weighed enroute are found to carry excess weight beyond the permissile limits
ex-gratia payment has been sanctioned by GM to railway employees affected by Tsunami
central railway refuses to accept IRFA debits on the plea that I is not an adjacent railway of southern railway
a PHOD asks the administration to pay the entire amount of Rs 2000/- in December 2004 for his mobile phone provided by the railway
a special pay sheet is lost by the cashier before payment has been made
you have detected a fraud of aout Rs 50000/- while inspecting a booking office
after opening of the tenders, the lowest tenderer expresses inability to carry out his work
SECTION- C 5 x 4 = 20 Marks
Distinguish between ANY FIVE of the following
1. Special Railway Safety Fund and Railway Safety Fund
2. PLB and Incentive Bonus
3. PEI and Operating Ratio
4. Gross Traffic Receipts and Gross Earnings
5. Single Tender and Single Offer
6. Pink Book and Green Book
7. Vote-On-Account and Voted Expenditure
SECTION – D 82 Marks
FIRST QUESTION IS COMPULSORY AND CARRIES 22 MARKS ANSWER ANY THREE OF THE REMAINING EACH OF WHICH CARRIES 20 MARKS
The three major achievements of the Accounts Department in the last 50 years are Computerisation in the 60s, Revised Classification in the 70s and FMIS in the 90s. Elaborate on the statement
OR
What are the major points of justification for provision of the 5th and 6th line between Chennai Central and Arakkonam. What are the points to be examined in Finance when such a proposal is received for inclusion in PWP?
What are the salient features of accounting followed in Southern Railway for reserved ticketing and in reserved ticketing in passenger traffic? What are your suggestions for improvement in both areas?
Elaborate the present system of accountal of Pension Payments. What are your suggestions for improving the same?
What are the important recommendations of Sudhir Chandra Committee? What changes are necessary in the present system of project management as far as Accounts Department is concerned?
What is the Official Language Policy followed in the railways? List out the documents which must be bilingual under section 3(3) of the Act. Give the Hindi equivalent for FA&CAO, Senior AFA and FC (Railways)
What are the various ways in which Railway Projects are financed? Explain the special features of financing followed in MRTS projects
elaborate on the system of Inventory Control followed in Railways with special emphasis on the role of Accounts Department
‘operating ratio is a good indicator of the financial health of a railway’, elaborated\ on this statement, what are your suggestions to bring down the operating ratio of Southern Railway to less than 100 % in the next five years
Sunday, July 03, 2011
AAO EXAMINATION QUESTIONS
2002
SOUTHERN RAILWAY
Selection of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 19/08/2002 Max Marks 150
Instructions to candidates
The question paper consists Four sections. Section” A” caries 30 marks, Section “B” carries 20 marks, Section ”C” carries 20 marks and Section “D” carries 80 marks
all questions in the first three sections ‘A’, ‘B’ and ‘C’ are to be attempted
in section “D” any FOUR questions have to be attempted out of the total 8 questions
Section A
Explain whether the following statements are “TRUE” or “FALSE” giving reasons for your answer
10 x 3 = 20 Marks
1. all expenditure on computer and other related items is charged to Plan Head No 17- Capital
2. all expenditure on repairs of Plant & Equipment is charged to Demand No 07- Minor Head 500
3. GM has full powers to approve and sanction expenditure on modifications and improvements to Rolling Stock
4. excise Duty and Sales tax is payable on all items of rolling stock manufactured or repaired in railway workshops
5. works and stores tenders are to be awarded to L1 only as per the latest guidelines
6. study leave and Hospital leave can be sanctioned by DRMs
7. the value realised from scrap sales is allocated to sundry earnings
8. surcharges is levied on all consignments booked as wagon loads
9. leave encasehment is permissible for balance credit of LHAP
10. arbitration awards are to be treated as “charged Expenditure”
Section B
Multiple choice questions There is only one correct answer
10 x 20= 20 Marks
this is an index indicating fuel efficiency
a. operating ratio b. BCI
c. ROR d. SFC
expenditure on safety related works is allocated to
a. DRF b. DF
c. Contingency Fund d. SRSF
staff related to expenditure of POH debits from Raiwlay Workshop is allocated to this Primary Unit
a.1 b. 2 c.34 d.99
expenditure on ballast for track renewal works is allocated to
a. Plan Head 31 PU No 03
b. D No 04 PU No 32
c. D No 04 PU No 28
d. Plan head PU No 08
an expenditure of Rs 100000/- on ceremonial occasions is sanctioned by
a. DRM b. AGM c. GM D. Railway Board
concession for senior citizens is given as
a. 30 % in all classes in Mail and Express Trains only
b. 30 % in sleeper class and second class only
c. 25 % in oridinary second class
d. 25 % in all classes beyond 500 KMs
in case fo missing non-issued tickets in SPTMS
a. debits are raised for single-fare up to the farthest point
b. debits are rasied for second class-fare to the farthest
c. at a flat-rate of Rs 500/-
d. debits are rasied for 4 dult-fares in II Mil Express to the farthest station
powers are delegatged to CWMs in respect of jobs done for PSUs
a, to waive off the full Proforma on –cost
b. to charge only 50 % of the on cost
c. to charge 0 % on cost
d. none of the above
commuted portion of the pension is restored
a. 15 years from the date of super-annuation
b. 15 years from the date of commutation
c. 12 years from the date of retirement
d. none of the above
all expenditure in workshops in respect of deposit works
a. is first charged to WMS
b. only the direct labour and direct stores in first charged to WMS
c. on cost and administrative overheads are charged to Deposit works directly and the rest to WMS first
d. none of the above
Section C
5 x 4 = 20 Marks
Distinguish between:
Consolidated Fund and Contingency Fund
workshop manufacturing suspense and Mis Advance Capital
draft para and action taken note
coaching earnings and other coaching earnings
IRCA and IRFA adjustments
Section D
Answer any four questions
4 x 20 = 80 Marks
1. Explain in detail the costing system adopted in our Repair Workshops. In what respects it is different from the one followed in our Production Units. Do you consider that our system is working satisfactorily?
2. Write critical comments on the incentive scheme adopted in workshops. Do you opine that the new guidelines and increased rates of incentive issued in 1999 and the steps taken so far have served the purpose?
3. Explain he salient features and deficiencies if any in the PRS and SPTM accountal of the earnings. Is the system of concurrent checking of accounts working well? Give your suggestions for improvement.
4. Explain the different areas and the scope for ‘Leakage of Revenue’ and give your suggestions for improvements in the system of internal checks in the Accounts Office and inspections of the TIAs
5. Is the financial and budgetary control of earnings and expenditure exercised by the accounts dept satisfactorily? What are the steps to be taken for improvement of the entire process?
6. ‘The system of giving accounting allocation by the departments and their checking in the accounts department is a farce resulting in enormous number of mis-classifications’ Please comment
7. ‘The pension debits received are not audited. There is no effective system of cheming reviosnof pension payment’ give your views and suggestions if nay for improvement
8. ‘finance concurrence in general and finance vetting of indents and estimates can be done away with to improve efficiency and perform better’ Give your critical views on the above recommendation.
&/&/&/&/&/&/&/
WWWWWWW
SOUTHERN RAILWAY
Selection of Assistant Accounts Officers
(70 percent quota)
Time: 3 hours 19/08/2002 Max Marks 150
Instructions to candidates
The question paper consists Four sections. Section” A” caries 30 marks, Section “B” carries 20 marks, Section ”C” carries 20 marks and Section “D” carries 80 marks
all questions in the first three sections ‘A’, ‘B’ and ‘C’ are to be attempted
in section “D” any FOUR questions have to be attempted out of the total 8 questions
Section A
Explain whether the following statements are “TRUE” or “FALSE” giving reasons for your answer
10 x 3 = 20 Marks
1. all expenditure on computer and other related items is charged to Plan Head No 17- Capital
2. all expenditure on repairs of Plant & Equipment is charged to Demand No 07- Minor Head 500
3. GM has full powers to approve and sanction expenditure on modifications and improvements to Rolling Stock
4. excise Duty and Sales tax is payable on all items of rolling stock manufactured or repaired in railway workshops
5. works and stores tenders are to be awarded to L1 only as per the latest guidelines
6. study leave and Hospital leave can be sanctioned by DRMs
7. the value realised from scrap sales is allocated to sundry earnings
8. surcharges is levied on all consignments booked as wagon loads
9. leave encasehment is permissible for balance credit of LHAP
10. arbitration awards are to be treated as “charged Expenditure”
Section B
Multiple choice questions There is only one correct answer
10 x 20= 20 Marks
this is an index indicating fuel efficiency
a. operating ratio b. BCI
c. ROR d. SFC
expenditure on safety related works is allocated to
a. DRF b. DF
c. Contingency Fund d. SRSF
staff related to expenditure of POH debits from Raiwlay Workshop is allocated to this Primary Unit
a.1 b. 2 c.34 d.99
expenditure on ballast for track renewal works is allocated to
a. Plan Head 31 PU No 03
b. D No 04 PU No 32
c. D No 04 PU No 28
d. Plan head PU No 08
an expenditure of Rs 100000/- on ceremonial occasions is sanctioned by
a. DRM b. AGM c. GM D. Railway Board
concession for senior citizens is given as
a. 30 % in all classes in Mail and Express Trains only
b. 30 % in sleeper class and second class only
c. 25 % in oridinary second class
d. 25 % in all classes beyond 500 KMs
in case fo missing non-issued tickets in SPTMS
a. debits are raised for single-fare up to the farthest point
b. debits are rasied for second class-fare to the farthest
c. at a flat-rate of Rs 500/-
d. debits are rasied for 4 dult-fares in II Mil Express to the farthest station
powers are delegatged to CWMs in respect of jobs done for PSUs
a, to waive off the full Proforma on –cost
b. to charge only 50 % of the on cost
c. to charge 0 % on cost
d. none of the above
commuted portion of the pension is restored
a. 15 years from the date of super-annuation
b. 15 years from the date of commutation
c. 12 years from the date of retirement
d. none of the above
all expenditure in workshops in respect of deposit works
a. is first charged to WMS
b. only the direct labour and direct stores in first charged to WMS
c. on cost and administrative overheads are charged to Deposit works directly and the rest to WMS first
d. none of the above
Section C
5 x 4 = 20 Marks
Distinguish between:
Consolidated Fund and Contingency Fund
workshop manufacturing suspense and Mis Advance Capital
draft para and action taken note
coaching earnings and other coaching earnings
IRCA and IRFA adjustments
Section D
Answer any four questions
4 x 20 = 80 Marks
1. Explain in detail the costing system adopted in our Repair Workshops. In what respects it is different from the one followed in our Production Units. Do you consider that our system is working satisfactorily?
2. Write critical comments on the incentive scheme adopted in workshops. Do you opine that the new guidelines and increased rates of incentive issued in 1999 and the steps taken so far have served the purpose?
3. Explain he salient features and deficiencies if any in the PRS and SPTM accountal of the earnings. Is the system of concurrent checking of accounts working well? Give your suggestions for improvement.
4. Explain the different areas and the scope for ‘Leakage of Revenue’ and give your suggestions for improvements in the system of internal checks in the Accounts Office and inspections of the TIAs
5. Is the financial and budgetary control of earnings and expenditure exercised by the accounts dept satisfactorily? What are the steps to be taken for improvement of the entire process?
6. ‘The system of giving accounting allocation by the departments and their checking in the accounts department is a farce resulting in enormous number of mis-classifications’ Please comment
7. ‘The pension debits received are not audited. There is no effective system of cheming reviosnof pension payment’ give your views and suggestions if nay for improvement
8. ‘finance concurrence in general and finance vetting of indents and estimates can be done away with to improve efficiency and perform better’ Give your critical views on the above recommendation.
&/&/&/&/&/&/&/
WWWWWWW
Thursday, April 15, 2010
SOME IMPORTANT QUESTIONS FOR APP IREM 3A
TRAFFIC ACCOUNTS
1. Traffic book and its parts
2. Cash in transit/stores in transit
3. Elements of passenger classification
4. Objects of traffic accounts office
5. Role of TIAs in preventing leakage of revenue
6. Accounts office balance sheet
7. Traffic suspense
8. Dynamic pricing policy
9. FOIS
10. COIS
11. UTS -
12. Sundry earnings
13. Journey of traffic earnings from station to cash office and accounts at RBI/Nagpur
14. Apportionment of traffic earnings
15. Terminal charges
16. Pilgrim tax
17. Non issued ticket NI statement
18. Traffic classification
19. Wagon turn round
20. Withdrawal from station earnings
21. Various types of frauds
22. Maintenance of ROB/RUB
23. Way lease charges
GENERAL EXPENDITURE
1. Surveys
2. Estimates: A. Check Of Estimates
3. Tenders- Global, LT, SLT, ST,
4. Contracts And Agreements
5. Measurement Book
6. Contractor’s Ledger And Check Of Contractor’s Bills
7. Works Registers And Revenue Allocation Registers
8. Material At Site Accounts
9. Deposit Works
10. Sidings – Private
11. Maintenance Of Land And Buildings
12. Completion Report
13. Objectionable Item Register
14. Labour Pay Sheets
15. Initial Records At XEN’s Office
16. Duties Of Works Accountant
17. Revised Classification
18. Various Funds – Capital, OLWR, DRF, DF , CF, RSF, SRSF
19. Parliamentary Control Over Expenditure
20. material modification
GENERAL EXPENDITURE SHORT NOTES
1. Feasibility Report
2. Techno Economic Survey
3. Departmental Expenditure
4. Divisional Schedule Of Rates
5. Financial Propriety
6. Late And Delayed Tender
7. Tender Committee
8. Terminal Tax
9. Earnest Money Deposit And Security Deposit
10. Deposit Miscellaneous Receipts / Expenditure
11. Muster Sheet
12. Completion Statement
13. Exchequer Control
14. Final Financial Review
15. August Review
16. Revised Estimate
17. Final Modification
18. Final Grant
19. Demands For Grants
20. Budget Order
21. Works Programme
22. Pink Book
23. Ballast
24. Buffer Stock
25. differentiate between want of estimate/excess over estimates
26. Differentiate between want of sanction/excess over sanction
27. Performance guarantee bonds
28. Bank guarantee
BOOKS
1. Distinguish between appropriation accounts and approximate accounts
2. Plan heads and revenue heads
3. Revenue and Capital PUs
4. Various funds in railways DRF, DF OLW-R, Capital and Capital fund
5. Differentiate DATC/DATD and TWFA
6. Remittance transactions and transfer transactions
7. RBI and PSB suspense
8. Features of Focal Point
9. Reconciliation of Cheques and bills
10. Deposits
11. Suspense heads for revenue, capital, traffic, workshop, stores and gen accounts
12. Annexure to appropriation accounts – what is annexure J
13. Internal audit and audit checking
14. Apportionment of earnings
15. Demands for grants 03-13, 1-2, 14-16
16. Allocation structure – capital and revenue
17. Parliamentary control
18. Structure of Govt accounts
19. Link heads between finance and commercial accounts
20. Half yearly arrear report
21. Debt head report
22. Debit/credit scroll
23. Appropriation accounts and Annexure to
24. Focal point
25. Link cell
26.
BUDGET
1. Distinguish between gross budget and net budget
2. Performance budget and the performance units
3. Integrated budget, deficit budget
4. ZBB
5. Capital budgeting in railways – RSP,FWP and M&P
6. Financial reviews
7. August review
8. FM/Final Modification
9. Budget grant
10. Proportionate budget grant
11. SL/ISL
12. Controllable PUs
13. Budget order
14. Cash estimates/requirement/cash authorization/
15. Cash budgeting
16. COPPY
17. RE/BE
18. Revised estimates/revised grant
19. Operating ratio
20. Voted and charged expenditure
21. PEI
STORES ACCOUNTS
1. ABC analysis
2. Inventory control
3. Stock verification
4. Stock adjustment accounts
5. Purchase accounts
6. Stores suspense
7. LC opening
8. MAC –
9. Computerization of stores accounts
10. Purchase order/ indent/stock and non stock
11. Types of tenders
12. Distinguish late and delayed tender
13. Role of finance member in stores tender committee
14. Purchase policy
15. Survey committee
16. Combined receipt cum issue note
17. EOT
18. Sources of supply
19. How the tender system has ensured the transparency in Govt transactions?
20. Turn over ration
21. LD
22. EMD and SD
23. SFC
24. EAR/AAC Quantity vetting
25. DGS&D and import policy
26. AIC
27. CFI
28. FOR destination
29. Receipt note
30. Lorry challans
31. Surplus stores/ dead surplus
32. Rate / running contract
33. Minima and maxima
WORKSHOP ACCOUNTS
1. GA Cards Tally sheets – time Records SN
2. Reconciliation of time records with financial records
3. Job costing
4. On costs general on cost, shop on cost and proforma on cost
5. Role PCO and allowed time in workshops
6. AHR - SN
7. Labour suspense - SN
8. What is a work order? Essential features of WO system types of work orders
9. List out the various documents related to production in shops
10. Make or buy decision in railway workshop
11. WMS debit / credit sides, how to keep it efficient
12. Out turn statements are the monthly progress card of a workshop
13. Accountal of labour and stores in the WGR SN
14. Compare CLW and CRS patterns of incentive schemes
15. Modernization, ISO, Total Quality control, green licensing
16. Idle time - SN
17. Costing system for POH, production and process
18. RCS of Loco POH
19. Batch costing in Production Units - SN
ESTABLISHMENT
1. LPC
2. MOD
3. OI REGISTER
4. Elements of internal check
5. Cadre/lien
6. BOS
7. Scale check register
8. FSC
9. Railway recoveries and non Railway Bodies (NRB)
10. Civil grants (HBA, MCA, Cycle, fan)
11. Staff cost on deputation
12. PRIME and AFRES
PENSION & SETTLEMENT
1. Qualifying service
2. Dies non
3. DCRG
4. Family pension
5. Enhanced family pension
6. Exgratia pension
7. NPS wef1.04.2004
8. PPO/PPA
9. RELHS
10.
1. Traffic book and its parts
2. Cash in transit/stores in transit
3. Elements of passenger classification
4. Objects of traffic accounts office
5. Role of TIAs in preventing leakage of revenue
6. Accounts office balance sheet
7. Traffic suspense
8. Dynamic pricing policy
9. FOIS
10. COIS
11. UTS -
12. Sundry earnings
13. Journey of traffic earnings from station to cash office and accounts at RBI/Nagpur
14. Apportionment of traffic earnings
15. Terminal charges
16. Pilgrim tax
17. Non issued ticket NI statement
18. Traffic classification
19. Wagon turn round
20. Withdrawal from station earnings
21. Various types of frauds
22. Maintenance of ROB/RUB
23. Way lease charges
GENERAL EXPENDITURE
1. Surveys
2. Estimates: A. Check Of Estimates
3. Tenders- Global, LT, SLT, ST,
4. Contracts And Agreements
5. Measurement Book
6. Contractor’s Ledger And Check Of Contractor’s Bills
7. Works Registers And Revenue Allocation Registers
8. Material At Site Accounts
9. Deposit Works
10. Sidings – Private
11. Maintenance Of Land And Buildings
12. Completion Report
13. Objectionable Item Register
14. Labour Pay Sheets
15. Initial Records At XEN’s Office
16. Duties Of Works Accountant
17. Revised Classification
18. Various Funds – Capital, OLWR, DRF, DF , CF, RSF, SRSF
19. Parliamentary Control Over Expenditure
20. material modification
GENERAL EXPENDITURE SHORT NOTES
1. Feasibility Report
2. Techno Economic Survey
3. Departmental Expenditure
4. Divisional Schedule Of Rates
5. Financial Propriety
6. Late And Delayed Tender
7. Tender Committee
8. Terminal Tax
9. Earnest Money Deposit And Security Deposit
10. Deposit Miscellaneous Receipts / Expenditure
11. Muster Sheet
12. Completion Statement
13. Exchequer Control
14. Final Financial Review
15. August Review
16. Revised Estimate
17. Final Modification
18. Final Grant
19. Demands For Grants
20. Budget Order
21. Works Programme
22. Pink Book
23. Ballast
24. Buffer Stock
25. differentiate between want of estimate/excess over estimates
26. Differentiate between want of sanction/excess over sanction
27. Performance guarantee bonds
28. Bank guarantee
BOOKS
1. Distinguish between appropriation accounts and approximate accounts
2. Plan heads and revenue heads
3. Revenue and Capital PUs
4. Various funds in railways DRF, DF OLW-R, Capital and Capital fund
5. Differentiate DATC/DATD and TWFA
6. Remittance transactions and transfer transactions
7. RBI and PSB suspense
8. Features of Focal Point
9. Reconciliation of Cheques and bills
10. Deposits
11. Suspense heads for revenue, capital, traffic, workshop, stores and gen accounts
12. Annexure to appropriation accounts – what is annexure J
13. Internal audit and audit checking
14. Apportionment of earnings
15. Demands for grants 03-13, 1-2, 14-16
16. Allocation structure – capital and revenue
17. Parliamentary control
18. Structure of Govt accounts
19. Link heads between finance and commercial accounts
20. Half yearly arrear report
21. Debt head report
22. Debit/credit scroll
23. Appropriation accounts and Annexure to
24. Focal point
25. Link cell
26.
BUDGET
1. Distinguish between gross budget and net budget
2. Performance budget and the performance units
3. Integrated budget, deficit budget
4. ZBB
5. Capital budgeting in railways – RSP,FWP and M&P
6. Financial reviews
7. August review
8. FM/Final Modification
9. Budget grant
10. Proportionate budget grant
11. SL/ISL
12. Controllable PUs
13. Budget order
14. Cash estimates/requirement/cash authorization/
15. Cash budgeting
16. COPPY
17. RE/BE
18. Revised estimates/revised grant
19. Operating ratio
20. Voted and charged expenditure
21. PEI
STORES ACCOUNTS
1. ABC analysis
2. Inventory control
3. Stock verification
4. Stock adjustment accounts
5. Purchase accounts
6. Stores suspense
7. LC opening
8. MAC –
9. Computerization of stores accounts
10. Purchase order/ indent/stock and non stock
11. Types of tenders
12. Distinguish late and delayed tender
13. Role of finance member in stores tender committee
14. Purchase policy
15. Survey committee
16. Combined receipt cum issue note
17. EOT
18. Sources of supply
19. How the tender system has ensured the transparency in Govt transactions?
20. Turn over ration
21. LD
22. EMD and SD
23. SFC
24. EAR/AAC Quantity vetting
25. DGS&D and import policy
26. AIC
27. CFI
28. FOR destination
29. Receipt note
30. Lorry challans
31. Surplus stores/ dead surplus
32. Rate / running contract
33. Minima and maxima
WORKSHOP ACCOUNTS
1. GA Cards Tally sheets – time Records SN
2. Reconciliation of time records with financial records
3. Job costing
4. On costs general on cost, shop on cost and proforma on cost
5. Role PCO and allowed time in workshops
6. AHR - SN
7. Labour suspense - SN
8. What is a work order? Essential features of WO system types of work orders
9. List out the various documents related to production in shops
10. Make or buy decision in railway workshop
11. WMS debit / credit sides, how to keep it efficient
12. Out turn statements are the monthly progress card of a workshop
13. Accountal of labour and stores in the WGR SN
14. Compare CLW and CRS patterns of incentive schemes
15. Modernization, ISO, Total Quality control, green licensing
16. Idle time - SN
17. Costing system for POH, production and process
18. RCS of Loco POH
19. Batch costing in Production Units - SN
ESTABLISHMENT
1. LPC
2. MOD
3. OI REGISTER
4. Elements of internal check
5. Cadre/lien
6. BOS
7. Scale check register
8. FSC
9. Railway recoveries and non Railway Bodies (NRB)
10. Civil grants (HBA, MCA, Cycle, fan)
11. Staff cost on deputation
12. PRIME and AFRES
PENSION & SETTLEMENT
1. Qualifying service
2. Dies non
3. DCRG
4. Family pension
5. Enhanced family pension
6. Exgratia pension
7. NPS wef1.04.2004
8. PPO/PPA
9. RELHS
10.
Thursday, February 11, 2010
TRIBUTE TO MR THARIAN JOSEPH
LOVING TRIBUTE TO THARIAN JOSEPH
RETD SECRETARY COMPLAINTS & APO,
SOUTHERN RAILWAY CHENNAI
Adieu and not good bye !!!
Mr. Tharian Joseph passed away on 1st February 2010 at his residence in Chennai . The burial service was held on 5th Feb 2010 at St Luke’s Church, Anna nagar, Chennai 40
At the outset I offer my personal condolences and on behalf of the Executive Committee and the members of the Southern Railway Catholic Association of which I am one of the Vice Presidents.
He was Asst Personnel Officer and Secretary Complaints (Public Grievances) directly reporting to the SDGM of Southern Railway till his retirement in 1990. He was the President of the Southern Railway Catholic Welfare Association Southern Railway Chennai till his retirement. Like until Gandiji’s arrival from South Africa, no one knew of Congress as a political party, until Mr. Tharian took over the reins of the Southern Railway Catholic Welfare Association, no one knew about its existence. It was run on as a charity organization by a few Anglo Indian employees of the Southern Railway.
When he took over, he gave a name to it with all rules and regulations and byelaws and got it registered to make it a transparent organization and with definite structure to run it continuously. Thus he gave us a name and a structure and a face among our non-Christian colleagues in Southern Railway. We are thankful to his trial blazing work.
He did not stop with just naming the “baby” but went on to find nourishment in terms of fund rising for the association. He proposed to have music evening along with release of a souvenir. He made us to go around and to collect funds for advertisements to be published in the souvenir. With all the efforts the souvenir was published in 1988 first of its kind in the history of the organization. Thus, he toiled to collect enough money to run the organization. In the course of action, he released a list of his friends and relatives who were in the banking and jewelers business.
Further, he made to organization as one of the notable one among the other lay organizations of the Madras Mylapore Arch Diocese. He was successful, in organizing the annual thanksgiving service right in the NJO quadrangle with Most Rev Dr Casimir G SJ DD PhD, the then arch bishop of Madras Mylapore Arch Diocese as the chief celebrant of the Eucharistic service. The entire staffs of HQ were amazed at his organizing such blitzkrieg right in the railway campus. The fete has not been repeated even after two decades. The meticulous planning and execution was his original idea and he executed through all of us splendidly well.
In order to encourage the spirit of unity among the Catholics employees of the Southern Railway, he organized long pilgrimage tour to Goa. To set an example, he joined with his family. The visit to the holy cathedrals and the visit to the Bom Jesu Cathedral where the mortal remains of St Francis Xavier, patron saint of missions and popularly known as Lord of Goa are preserved, are unforgettable. We owe a lot of thanks to the efforts he had taken.
Also, during his tenure as the President, we had ample opportunity to visit the homes maintained by the Missionaries of Sisters of Charity, the congregation of Mother Theresa in around Chennai. The practice of having Friday Eucharistic service at the St Antony’s Church was started during his tenure. Also visit to various parishes during Good Friday in and around Chennai and the way of the cross on Fridays were started during his tenure as the President.
Personally, Mr. Tharian and my father David Dorairaj retd AWM/EWS/AJJ Southern Railway, were good friends and the friendship lasted till the death of my father on 13th May 2009. when I informed about the death of my father at the Railway Hospital on 13th may 2009, he was eager to come pay his last respects to him. I cannot forget his initiative to take myself and my friend Mr A L Xavier, in to the Wisemen Association Perambur Branch. Together with him we both had attended many meetings of the association and were able to execute a few projects for the needy people.
What is striking was the man’s compassion for the poor and the needy. Though born in a well to do family in kerala, he never had the air of superiority and snobbishness. I never felt him as an officer of the Central Govt but always as a great friend and a guide. Hence, he used to call me often on phone and enquire about many things. Even a month ago he was passionately pleading for a widow of a railway employee of LW/PER for issue of ID card.
Once again, I offer my heartfelt condolences to the bereaved family, sons, daughters, daughters-in-law, sons-in-law and grand children. Hence, let me conclude “adieu and not good bye” because as Christians, we believe that we shall see him on the beautiful shore as we see him now.
D XAVIER GNANARAJ,
RETD SECRETARY COMPLAINTS & APO,
SOUTHERN RAILWAY CHENNAI
Adieu and not good bye !!!
Mr. Tharian Joseph passed away on 1st February 2010 at his residence in Chennai . The burial service was held on 5th Feb 2010 at St Luke’s Church, Anna nagar, Chennai 40
At the outset I offer my personal condolences and on behalf of the Executive Committee and the members of the Southern Railway Catholic Association of which I am one of the Vice Presidents.
He was Asst Personnel Officer and Secretary Complaints (Public Grievances) directly reporting to the SDGM of Southern Railway till his retirement in 1990. He was the President of the Southern Railway Catholic Welfare Association Southern Railway Chennai till his retirement. Like until Gandiji’s arrival from South Africa, no one knew of Congress as a political party, until Mr. Tharian took over the reins of the Southern Railway Catholic Welfare Association, no one knew about its existence. It was run on as a charity organization by a few Anglo Indian employees of the Southern Railway.
When he took over, he gave a name to it with all rules and regulations and byelaws and got it registered to make it a transparent organization and with definite structure to run it continuously. Thus he gave us a name and a structure and a face among our non-Christian colleagues in Southern Railway. We are thankful to his trial blazing work.
He did not stop with just naming the “baby” but went on to find nourishment in terms of fund rising for the association. He proposed to have music evening along with release of a souvenir. He made us to go around and to collect funds for advertisements to be published in the souvenir. With all the efforts the souvenir was published in 1988 first of its kind in the history of the organization. Thus, he toiled to collect enough money to run the organization. In the course of action, he released a list of his friends and relatives who were in the banking and jewelers business.
Further, he made to organization as one of the notable one among the other lay organizations of the Madras Mylapore Arch Diocese. He was successful, in organizing the annual thanksgiving service right in the NJO quadrangle with Most Rev Dr Casimir G SJ DD PhD, the then arch bishop of Madras Mylapore Arch Diocese as the chief celebrant of the Eucharistic service. The entire staffs of HQ were amazed at his organizing such blitzkrieg right in the railway campus. The fete has not been repeated even after two decades. The meticulous planning and execution was his original idea and he executed through all of us splendidly well.
In order to encourage the spirit of unity among the Catholics employees of the Southern Railway, he organized long pilgrimage tour to Goa. To set an example, he joined with his family. The visit to the holy cathedrals and the visit to the Bom Jesu Cathedral where the mortal remains of St Francis Xavier, patron saint of missions and popularly known as Lord of Goa are preserved, are unforgettable. We owe a lot of thanks to the efforts he had taken.
Also, during his tenure as the President, we had ample opportunity to visit the homes maintained by the Missionaries of Sisters of Charity, the congregation of Mother Theresa in around Chennai. The practice of having Friday Eucharistic service at the St Antony’s Church was started during his tenure. Also visit to various parishes during Good Friday in and around Chennai and the way of the cross on Fridays were started during his tenure as the President.
Personally, Mr. Tharian and my father David Dorairaj retd AWM/EWS/AJJ Southern Railway, were good friends and the friendship lasted till the death of my father on 13th May 2009. when I informed about the death of my father at the Railway Hospital on 13th may 2009, he was eager to come pay his last respects to him. I cannot forget his initiative to take myself and my friend Mr A L Xavier, in to the Wisemen Association Perambur Branch. Together with him we both had attended many meetings of the association and were able to execute a few projects for the needy people.
What is striking was the man’s compassion for the poor and the needy. Though born in a well to do family in kerala, he never had the air of superiority and snobbishness. I never felt him as an officer of the Central Govt but always as a great friend and a guide. Hence, he used to call me often on phone and enquire about many things. Even a month ago he was passionately pleading for a widow of a railway employee of LW/PER for issue of ID card.
Once again, I offer my heartfelt condolences to the bereaved family, sons, daughters, daughters-in-law, sons-in-law and grand children. Hence, let me conclude “adieu and not good bye” because as Christians, we believe that we shall see him on the beautiful shore as we see him now.
D XAVIER GNANARAJ,
AAO/W/PER
NEW JOINT OFFICE
SOUTHERN RAILWAY,
AYANAVARAM CHENNAI 23
Posted on the 5th February 2010
Posted on the 5th February 2010
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Monday, November 16, 2009
DEDICATED FREIGHT CORRIDOR CORPORATION OF INDIA LTD
REVOLUTIONIZING FREIGHT TRAFFIC- THE IR EXPERIENCE
DEDICATED FREIGHT CORRIDOR CORPORATION OF INDIA LTD
DFCCIL
Introduction
The Indian Railways constitute a critical component of India’s transport network, both for passenger as well as freight services. Railways are cost effective and also environment friendly. Yet, capacity and efficiency constraints in the freight segment have led to a significant shift from railways to road transport.
Renewed focus of the Railway Ministry on efficiency, customer care, and commercial principles is aimed at reversing this trend. The recent turn around in railway operations suggests that Indian Railways are poised for rapid growth in capacity expansion.
The high density Eastern and Western corridors are already saturated in terms of line capacity utilization. Accelerated growth of the economy is only adding to the congestion on these routes. A quantum jump in capacity is, therefore, necessary for meeting the rising freight demand on account of robust domestic growth as well as the rapid increase in international trade.
The objective of the project is to cope with the increase of freight transport demand in India by constructing new dedicated freight railway system, thereby promoting comprehensive regional economic development along the freight corridor, through improvement and modernization of inter-modal logistic system handling considerable freight.
The project is expected to augment the capacity of railway network to handle the large increase in freight traffic over the coming years. The DFC would enable freight trains to run at 80-90 km per hour, compared with the present speed of 25-30 km per hour.
Task force on dedicated freight corridors:
The Task Force Report suggests an institutional roadmap for the construction and operation of the dedicated freight corridors. These corridors would be constructed, operated and maintained by a corporate entity on commercial principles while relying on efficient technological solutions. Scarce budgetary resources would be leveraged for raising debt from the markets, based on a sound business plan.
The proposed corporate entity would provide the rail infrastructure, but would not itself engage in freight business, thus providing non-discriminatory track access on payment of haulage charges by train operators. This approach would herald large scale private investment and competition in freight operations. This underlying separation of rail from wheels would also mark a paradigm shift in the functioning of Indian Railways who have already introduced private participation and competition in movement of container trains. (Gajendra Haldea)
The Dedicated Freight Corridor Corporation of India is a corporation managed by the Government of India to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. DFCC has been registered as a company under the Companies Act 1956 on 30th October 2006. “Dedicated Freight Corridor Corporation of India Limited (DFCC)” is a special purpose vehicle created to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. DFCC has been registered as a company under the Companies Act 1956 on 30th October 2006.
Over the decades, in order to keep populist election agenda, the passenger fares are slightly touched in spite of spiraling input cost. The loss sustained in the passenger fares is cross-subsidized by enormous increase in the freight tariff
Ministry of Railways have planned to construct a new Dedicated Freight Corridor (DFC) covering about 2762 route-km on two corridors, Eastern Corridor from Ludhiana to Haldia and Western Corridor from Jawahar Lal Nehru Port Mumbai to Tughlakabad/Dadri along with interlinking of two corridors at Khurja. Upgradation of transportation technology, increase in productivity and reduction in unit transportation cost are the focus areas for the project.
Need for Dedicated Freight Corridor Project
Economic liberalization policies of 1991 followed by information technology explosion have taken India to a new growth scenario. Backed by strong fundamentals and commendable growth in the past three to four years, the resplendent Indian Economy is poised to grow even further at an average of 8 to 10% in the next 3 years.
Transport requirement in the country, being primarily a derived demand, is slated to increase with elasticity of 1.25 with GDP growth by 10 to 12% in the medium and long-term range. Riding on the waves of economic success, Indian Railways has witnessed a dramatic turn around and unprecedented financial turnover in the last two and a half years.
This has been made possible by higher freight volumes without substantial investment in infrastructure, increased axle load, reduction of turn-round time of rolling stock, reduced unit cost of transportation, rationalization of tariffs resulting in improvement in market share and improved operational margins. Over the last 2 to 3 years, the railway freight traffic has grown by 8 to 11%, which is projected to cross 1100 million tonnes by the end of XI Five Year Plan.
The Indian Railways’ quadrilateral linking the four metropolitan cities of Delhi, Mumbai, Chennai and Howrah, commonly known as the Golden Quadrilateral; and its two diagonals (Delhi-Chennai and Mumbai-Howrah), adding up to a total route length of 10,122 km carries more than 55% of revenue earning freight traffic of IR.
The existing trunk routes of Howrah-Delhi on the Eastern Corridor and Mumbai-Delhi on the Western Corridor are highly saturated, line capacity utilization varying between 115% to 150%. The surging power needs requiring heavy coal movement, booming infrastructure construction and growing international trade has led to the conception of the Dedicated Freight Corridors along the Eastern and Western Routes.
Almost simultaneously, the Cabinet approved the report of the Task Force of the COI, which directed that a SPV should be set up to construct and operate the DFC. Cabinet Committee on Economic Affairs (CCEA) gave "in principle" approval to the Feasibility Study report asking the MOR to go ahead with Preliminary Engineering cum Traffic Survey (PETS) for the two corridors, firm up the cost of the project and work out the financing options. In consonance with the recommendation of the Task Force of COI, a SPV, named "Dedicated Freight Corridor Corporation of India Limited (DFCCIL)" was incorporated under Companies Act in October 2006. Subsequently, RITES submitted the PETS Report based on which the project was approved at a cost of Rs. 28,181 Crore.
Funding the Project:
The railways are likely to secure a loan of Rs 37,200 crore from multilateral institutions, including the World Bank and the Asian Development Bank (ADB). The amount is expected to take care of the construction of about 76 per cent of the proposed 2,739-km dedicated rail freight corridor (DFC). The Japan International Cooperation Agency (JICA) has already committed a loan of Rs 18,000 crore at an interest rate of 0.2 per cent for funding the 920-km stretch between Rewari and Vadodara on the proposed western dedicated freight corridor. The final agreement between the JICA and the railways is expected in the first quarter of 2009-10. Meanwhile, the World Bank has given its approval in principle for a loan of Rs 12,000 crore for the 730-km Mughalsarai-Khurja section, while the ADB has shown an interest in lending Rs 7,200 crore to finance the 430-km stretch between Khurja and Ludhiana. Both these stretches fall on the proposed 1,256-km eastern freight corridor between Ludhiana and Howrah.
“The rate of interest at which the World Bank and the ADB will advance these loans is likely to be 5.5 per cent. We have already started the process of negotiations with these institutions and a final agreement will be signed by the end of 2009,” said a senior official of Dedicated Freight Corridor Corporation of India Ltd (DFCCIL).
As part of the World Bank funding programme, DFCCIL has appointed a consortium of consultants which includes Parsons Brinkerhoff India, Halcrow, Wilber Smith and Lee Associates for system design, finalization of bid documents and supervision of the construction of the 300-km Khurja-Kanpur section on the eastern dedicated freight corridor.
“We have already submitted the draft pre-qualification document for design and build contract to the World Bank. The bidding process for the same is likely to commence by March 2009,” said the DFCCIL official.
Meanwhile, a technical assistance team from the ADB has held consultations with senior members of the Railway Board and DFCCIL. Following this, the ADB has proposed to provide technical assistance for undertaking a feasibility study of the Ludhiana-Khurja section.
A JICA report has estimated the total cost of constructing both western and eastern freight corridors at Rs 37,218 crore.
The debt-equity ratio of the project has been decided at 2:1. The railways will bring in the equity part.
“The commitments from multilateral institutions are a little higher than the estimated requirement. Since the project will be implemented over the next six years, there is always a chance of cost escalation. In such a scenario, it will be easy for them to lend more without going through the approval process,” said the DFCCIL official.
The Government of Japan has committed an amount of 2,606 million yen for the Engineering Services Loan under Dedicated Freight Corridor Project (Phase-I).
Structure of SPV:
The mechanism of SPV, owned jointly by the Indian Railways and the users of bulk freight services (e.g. port operators, shipping companies, oil companies, coal, iron ore and steel companies as well power companies, largely in the public sector) should be entrusted with the task of planning, construction and maintenance of infrastructure. The SPV will also be responsible for movement of trains on its system and operation of the dedicated freight corridors.
The Ministry of Railways should be the administrative Ministry for the SPV. In order to ensure that the SPV has effective independence in decision-making and is able to function with a market focus and business orientation it should have sufficient autonomy, delegation and flexibility in conducting its business.
The coming together of the Railways and mainly public sector undertakings that are bulk users of freight services, with some topping up by the Central Government, would ensure an adequate equity base, which could be leveraged for market borrowings for raising enough capital for investment in the dedicated freight corridor.
The Task Force considered the two broad models that are in existence in the world today and weighed the pros and cons of both vertically integrated and completely separated models. The vertically integrated model has its own advantage by way of synergy between infrastructure and operation but the disadvantage is that it does not allow above rail competition. The separated model allows above rail competition but suffers from the absence of synergy and also higher costs.
The Task Force recommends the adoption of a model, which captures the benefits of both the models. The SPV, which would own and maintain the track and other infrastructure, would also move the trains within the corridor on its system, but would not own or lease any rolling stock nor do any freight business other than haulage of freight trains. The Indian Railways and other qualified operators would run goods trains on the tracks of the corridors and would be given nondiscriminatory access for this purpose.
Whether the existing corridor should be used for the dedicated freight corridor and a new one constructed for the passenger corridor
Due to the major constraining factors on the existing high-density routes of Indian railways, which limit throughput, the dedicated freight corridors need to be constructed on new alignments. Augmenting freight capacity on existing network would involve significantly heavier investments. Furthermore the investment in dedicated high-speed passenger corridor would give relatively lower returns on capital.
It is widely recognized that in order to improve the performance of the Indian Railways it must be run on business lines and must become customer-oriented and market driven. At present the Indian Railways is not in a position to run purely on a commercial basis because it has social responsibilities.
The Indian Railway system has a dual role:
It provides commercial services while at the same time it performs a number of useful social functions. Activities such as movement of freight in general and of some classes of passengers are carried out on a commercial basis, but the Indian Railways also run suburban and other passenger services below cost, transport essential commodities at a loss, run branch lines that are not remunerative and are expected to provide increasing employment opportunities to the population. While the Railways cannot be absolved of these responsibilities, it is necessary for its efficient functioning, that the two roles are separated to the extent possible.
Railways (Rakesh Mohan Committee), since the objectives of commercial activities are different from those for social activities, separate parameters are needed to assess performance. Commonly accepted financial parameters like revenues, profits, return on capital employed etc. are appropriate to assess performance of the commercial projects. For social projects, operational parameters such as improvement in connectivity and punctuality, increase in traffic etc. could be used. Segregation of these two categories of activities and functions over the Indian Railways across-the-board is a formidable task. However, the dedicated freight corridors present a good opportunity to make a beginning by setting up an independent organization for its establishment and operation.
In India the railways have been losing freight business to roadways, although less rapidly than in advanced countries. Railways retain their relative advantage mainly in natural resource and intermediary goods markets in which there are large volume movements and relatively low value-to-weight ratios and tend to lose it as the value-to-weight ratios of manufactured commodities increases unless they can provide high quality container services particularly on medium and long hauls. In order to retain and even increase market share the Railways need to be repositioning itself all the time in order to meet the challenge of competition from the road sector. For that it needs a market focus in its operation. In the new organization for the dedicated freight corridor it should be possible to undertake periodic performance-review and problem solving sessions with major clients to improve the service. Information may need to be collected on the enterprise’s competitive position vis-Ã -vis the roadways sector, and improvements undertaken.
The competitive pressure on Indian Railways will increase with the further upgradation of the National Highways on the Golden Quadrilateral, which is now being taken up for six-laning. In order to compete with the roadways it would be necessary not only to lower price but also to improve performance
Generally in accordance with the requirement of the clientele. According to a nation-wide survey of users of rail freight services conducted in 1997, the results of which are mentioned in the Rakesh Mohan Committee Report, the Indian Railways was rated below roadways on all parameters viz., reliability, availability, price, time, connectivity, suitability, damages, information sharing, adaptability, cost-friendliness, negotiability, access to officials, ease of payment and claim time. These aspects can be addressed more efficiently in an independent organization operating services in the dedicated freight corridors than in a very large organization like the Indian Railways.
Following the initiation of economic reforms in 1991, India has been gradually increasing its integration into the world economy. With the abolition of import licensing and the gradual reduction in customs duties, Indian manufactures have to compete with foreign manufactures not only in foreign markets but in the domestic market as well. Unless the Indian industry has the benefit of world-class services at internationally competitive prices, it would not be able to compete with its foreign counterparts. In India many production centers are situated away from the ports and production and consumption centres are also far apart. In this situation it is not simply the cost of transport that matters. Equally important is the quality and reliability of service. In an increasingly competitive environment the Indian industry has to keep its inventories of raw materials and intermediate products down and keep pace with the imperatives of just-in-time manufacturing. All that is not possible if a reliable transporter does not back the supply chain of industrial goods. Unless its performance is improved through the adoption of a customs-oriented approach, in providing particularly on-time services, the Indian Railways cannot provide that type of service.
In recent years, the Indian Railways has taken a number of steps to improve its services, with the result that its physical and financial performance has shown marked improvement. This is a welcome development. However, the Railways has to do much more to improve the quality of its services. A separate new organization, which is not burdened with the task of balancing the conflicting objectives, would be in a much better position to follow a market savvy approach and lift the standard of service significantly.
The Task Force noted that the development of a dedicated freight corridor is highly capital intensive. The provision of such a corridor and its operation must be on commercial principles if quality services are to be provided on a sustainable basis. This would require setting up of higher productivity standards, entailing the adoption of norms, benchmarks, policies and practices, which may be significantly different from what are being followed by the Indian Railways.
Finally, the investment requirement of the freight corridors is currently estimated to be at least about Rupees 22,500 crore, although the RITES study now under way might well result in a higher estimate. The project would take at least five years for implementation (after the new organizational structure is established, project report finalized, approval obtained and funding firmed up) and assuming that the current estimates are correct, the average annual requirement would work out to more than Rupees 4500 crore. This requirement would be over and above the normal requirements of the Railways for renewal and replacement, acquisition of rolling stock, multiplexing, modernization, projects for new lines and conversion into broad gauge etc. There are constraints in the Central Government allocating and in the Railways generating funds of this magnitude. The prospect of the Japanese Government providing assistance for the dedicated freight corridors is being explored. A final picture in this regard will emerge only after a study commissioned by the Japanese International Co-operation Agency (JICA) is completed. The current assessment is that the aid, if forthcoming, will be available in two to three years.
In light of the above an independent commercial organization, capable of raising funds from the domestic capital market appears to be the only feasible option. Such an organization would be able to leverage equity of say about Rupees 7,500 crore to raise a debt for the remaining requirement of Rupees 15,000 crore and finance the project. A departmental enterprise of the Ministry of Railways may not be able to raise loan from the domestic capital market, but a separate corporate entity will, if it inspires confidence in its ability to run as a commercially viable undertaking. Worldwide railway undertakings, particularly those that also take up infrastructure development, have generally not been able to run as profit-making commercial enterprises. Recovery of capital spent on the infrastructure has not been accomplished and capital grants from the Government have been the general practice
Having regard to the factors considered above, a Special Purpose Vehicle (SPV) would seem to be best suited to carry out the task of planning, construction and operation of the dedicated freight corridor. Should the SPV be owned fully by the Indian Railways or should it have a more diversified ownership? The Task Force believes that a more diversified ownership with other stakeholders, mainly from the public sector, as investors in equity would be in the best interest of efficient management of the freight corridor, besides generating the requisite equity fund. Some of the stakeholders identified for the purpose are the port operators including Port Trusts, shipping and shipping-related companies, oil companies, coal, iron ore and steel companies, such as CCL and SAIL and NMDC, and power companies such as the NTPC.
It would be recalled that the Department of Shipping had at one time indicated that port operators/ shipping companies were interested in constructing and operating the freight corridor between Delhi and Mumbai. The oil companies are likely to continue as one of the main users of the railway system even as they make increasing investments in pipelines. CCL, SAIL, NMDC and NTPC would have a major stake in the development of many segments of the Eastern Corridor, but to motivate them to make investments, it would be necessary to take their requirements into consideration while deciding on the alignment.
Even though the Task Force believes that the SPV could be viable as a commercial undertaking, it does not consider that at the outset it would generate interest among private sector investors, except a few entities already in transport business. The investment would have to be made principally by the Railways and the public sector companies named above. The Task Force recommends that the equity be shared between the Railways (including its subsidiaries) and the other stakeholders, mainly the bulk users of freight services among the PSUs. The Central Government could come in for meeting any shortfall in equity that might arise.
Participation of the above-mentioned stakeholders would serve two ends. First, the burden on the Railways for making a large equity investment would be reduced and the funds available with public sector undertakings would be utilized. Second, financial participation by users of freight services would bring to the boardroom the much needed customer orientation and help to bring a market focus in the working of the organization.
It will be ensured that the SPV functions fully as an independent commercial enterprise. The Ministry of Railways should be the administrative Ministry for the SPV. The appointment and number of functional Directors should adhere to PESB guidelines. Further, the Ministry of Railways should nominate one part-time Director as stipulated in the PESB guidelines. Similarly, appointment of independent Directors should also be governed by PESB guidelines.
The Task Force recommends that in order to help ensure the requisite volume of financing
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 9
as well as to provide adequate representation of other stakeholder interests, the Board should have a nominee each from the Finance Ministry and Planning Commission. However, the representative of Railways Ministry expressed reservations.
Separation of Infrastructure from Operation
The Task Force considered the option of separation of control and management of the railway track and associated infrastructure on the one hand and above-rail operators (i.e. operators of rolling stock) which have been provided access, on the other. Such separation is considered by some as ideal for unleashing above-rail competition for greater efficiency. A situation in which no rail operator controls the infrastructure can ensure equality of access.
The Task Force reviewed the international experience in this regard. There are three basic models in existence.
First is the vertically integrated structure, as in China, Russia, India, Brazil, Mexico, and Argentina, to name a few countries with large railway systems. Where publicly owned some of the railway systems are run either directly by Ministries or by corporate units or organizations owned by Government. In Russia, China and India the State-owned companies are horizontally integrated, while in Brazil, Mexico and Argentina there are many privately owned regional companies. In other instances, the integrated railways are run by the private sector on the basis of concessions or franchises awarded by the government owner. In yet other cases, the integrated structure is owned and managed by the private sector.
Second is the structure in which the dominant user is integrated with infrastructure while incremental users have access for which they pay access fees. The best example of this is in the US, in which one vertically integrated freight railway uses the infrastructure of another vertically integrated freight railway without much difficulty. Further the Amtrak under public ownership runs its passenger trains over the tracks of the privately owned freight railways. In Japan, the Japan Rail Freight Corporation runs as a Government undertaking on infrastructure owned by privatized regional undertakings, which carry passengers. This model has also been adopted in Canada, Mexico and other countries.
Third is the model in which the infrastructure is separated from the users but remains accessible to all under an access regime. We are familiar with this model in the roadways and airports, but in recent times it has been advocated as one of the ways of restructuring railways. The European Union has adopted this model progressively since 1991, but infrastructure and operations were genuinely split in a number of other countries even earlier.
In all these countries both the infrastructure and operations remained mainly under public ownership. The British Government, although a member of the European Union, went far beyond others in establishing a separate infrastructure enterprise in onjunction with one or more freight companies, intercity passenger companies, and a number of regional or suburban passenger companies, which were all privatized. The British experiment was unique in that the infrastructure company was also privatized. However, the experiment for privatization of the infrastructure was not successful and the privatized infrastructure company became bankrupt and had to be renationalized. It should be noted that even when the infrastructure company in Britain was The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 11 privatized more than a third of its income came from state subsidies to train operators, which were passed through. The bankruptcy was a direct consequence of the Government turning off the tap.
The experience of separation in Australia also has a similar lesson. A World Bank Report (TP-7 OF September 2005) on the experience of restructuring in the Australia and New Zealand, has come to the following conclusion on the operation of the Australian Rail Track Corporation (ARTC), which was established in 1998 to manage access and infrastructure development on the interstate track:
“The publicly owned ARTC, which manages many of the higher density interstate rail corridors in Australia, has been cash positive but earns significantly less than the replacement cost of its assets, and over the longer term will require some public funding to sustain and enhance its network. The Australian Government has already committed to significant grants to uplift the quality and performance of the interstate rail network, including improving access into the congested Sydney network. However, as volumes increase the commercial performance of the ARTC, which has spare capacity and largely fixed costs, will improve.”
The European Union has been moving towards separation since 1991. Article I of the Council Directive of 29 July 1991 on the development of the Community’s railways (91/440/EEC) explains both the aim and the content of the directive.
“Article I
The aim of this Directive is to facilitate the adoption of the Community railways to the needs of the Single Market and to increase their efficiency;
· by ensuring the management independence of railway undertakings;
· by separating the management of railway operation and infrastructure from the provision of railway transport services, separation of accounts being compulsory and organizational or institutional separation being optional,
· by improving the financial structure of undertakings, -by ensuring access to the network of Member states for international groupings of railway undertakings and for railway undertakings engaged in the international combined transport of goods. Article 6 of the Directive mandated Member States to ensure that ‘the accounts for business relating to the provision of transport services and those for business relating to the management of railway infrastructure are kept separate. Article 10 directed that international groupings must be granted access and transit rights in all Member states in respect of international services.”
Member States implemented the Directive in various ways. We have seen that the British Government not only brought about a total separation but also broke up the two segments into multiple private companies. Sweden had initiated action for setting up separate public sector undertakings for infrastructure (Banverket) and operations (SJ) even before it acceded to the European Union in 1995. On 29 April 2004 the European Union moved further for bringing about enhanced access. By the Council Directive 2004/51/EEC the European Parliament and the Council of the European Union required not only that railway undertaking must continue to be granted access to the Trans-European Rail Freight Network but also they must be given access for the purpose of operating all types of rail freight services.
While the European Union is committed to forge ahead with the separation model, reviews of the implementation of the policy seem to indicate that in railway circles there is considerable doubt on the acceptability of the separation model as the superior option. A recent publication states that “no clear view emerges on the ‘best’ model (integrated or separated)” (Community of European Railway and Infrastructure Companies 2005, Reforming European Railways- An assessment of progress, Eurorail Press, Hamburg). Another publication, of which the author was Director of the Public Transport Union in Switzerland from 1969 to 2000, is more forthright in his assessment. “As does the generally known situation in Great Britain, also this analysis of the seven countries with institutional separation gives proof of the fact that separation has no benefits. It only brings serious problems” (Pfund, Carlo, Separation Philosophy of the European Union-Blessing or Curse, Service D’Information Pour Les Transports Publics).
A communication from the Executive
Director of the Community of European Railway and Infrastructure Companies (CER) in Brussels addressed to the Chairman of the Task Force states:
“There is no empirical evidence in Europe that separation between infrastructure and operating services leads to real improvements in the railway system: just the other way around.” The same communication brings out the following facts:
· The CEO of the most successful railway company in Europe (in terms of capacity utilization, customer satisfaction, quality, etc.)- the Swiss railway company SBB believes that the high quality of SBB rail services is only possible because he can optimize simultaneously the synergy of infrastructure and operation within one company under one management.
· Despite the EU move towards separation almost all countries in the centre of Europe - i.e. those companies experiencing a high density of rail traffic - have retained the model of integrated holding companies (Germany, Poland, Switzerland, Austria, Italy, Belgium, Luxembourg) in order to maintain a high efficiency and productivity of the railway system as a whole. Separation has been effected mainly in countries at the periphery of Europe, i.e. without transit traffic and with considerably lower traffic intensity.
· The experience in quite a number of European countries (Germany, Switzerland,
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 13
Austria, Italy, Poland, etc.) has shown however that the objective of competition can be achieved without giving up the model of an integrated company. The Deutsche Bahn has the full responsibility for the rail infrastructure, but shares the offering of railway services today with 290 other rail companies having a railway company licence for the German network. A well functioning regulatory framework defines the general rules for the access to the rail infrastructure - rules to be applied by Deutsche Bahn, which is supervised in this respect by a German public rail authority.
In order to get over the handicaps of separation, efforts are underway to reinforce again cooperation and links between the separated units in order to regain the interdependencies and synergies of the railway system. Publications on the subject of railway organization have also brought up some other relevant facts:
· Even where separation has taken place sometimes it is more in form and less in substance. In France the infrastructure company, RFF, owns the infrastructure assets but maintenance of the infrastructure as well as operations is handled fully by SNCF, the National Railway System. RFF defines the principles and objectives of traffic management and direction, and SNCF is the delegated infrastructure operator contracted for operation and maintenance. Thus SNCF is formally separate but materially integrated (Pfund, Carlo, Separation Philosophy of the European Union- Blessing or Curse).
· Studies by scholars show that an integrated structure produces a cost saving of 27 per cent over a separated system (Ivaldi, M. and McCullough, G., 2002, Subadditivity tests for network separation, mimeo Toulouse and Northwestern University, cited in Reforming Europe’s Railways –An assessment of progress, Eurail Press, 2005)
The concept of synergy between infrastructure and operation is also referred to by experts as rail-wheel interaction and has been explained at length as follows:
Optimization of train operation on the network
The railway functions as a system of vehicles, infrastructure, and operation control technology, like a machine. Only through a combined working of all the elements of the technical system, operational reliability and safety can be guaranteed. This is where the railway differs from other transport modes. By means of permanent central coordination, including the use of modern telematics, the system can be optimized and can thus guarantee maximal efficiency and punctuality. By way of central coordination, headways of trains can be shortened until braking distance, timetables can be harmonized, and efficient measures can be taken in the event of incidents. Modern technology and traffic control systems make it possible to reduce headways between trains, to speed up vehicle turn-round cycles and to reduce the vehicles fleet held in reserve.
The optimal run of operations is only guaranteed by the integration of operations and infrastructure. Only a technically integrated
Report of the Task Force enterprise can assume full responsibility towards the customers for its run of operations.
Further technical development of the comprehensive railway system
Until technical innovations and adaptions in the railway world can finally be put into practice, they are subject to an onerous harmonization process. Different groups are involved in the elaboration of the service product, groups whose interests are not necessarily quite the same. An integrated enterprise, in its decision oriented towards the technical and economical overall optimum, can implement necessary innovations quickly and can assume responsibility for the investment risk. Railway offers that are competitive for a long time presuppose a permanent further development of the compound system railway as a homogenous whole. The other transport modes are developing themselves further at breakneck speed. In this innovation race, the railway can only stand its ground if technologies in the infrastructure, as well as in the vehicles, are developed further at the same speed and in a concerted way. High-speed lines and trains, the safety system ETCS, and the digital GSM-R radio communication system connected with it, all have been planned and developed by integrated railway enterprises.
Guaranteeing a high safety standard in the use of the latest technology
Train traffic puts special demands on observance of safety standards in the systemspecific interplay of wheel, rail and control technology. Also, if high safety standards can be defined or be monitored by a political authority, a clear responsibility for safety must in the final analysis be discernable. If one considers the implication in the case of accidents, a fragmentation of responsibility between operations and infrastructure must be doubly rejected. Overall responsibility for train operations can only be assumed by the manager or managing body who can control and supervise all safety-relevant influence factors. (Pfund, Carlo, Separation Philosophy of the European Union - Blessing or Curse, Service D’Information Pour Les Transports Publics).
The experience of British Rail in separation also has some lessons. AWorld Bank Report drew inter alia the following conclusion on this:
“Separation of infrastructure from operations did cause problems of complexity and cost (transaction costs). It did not cause increased accidents and it did not support an increase in demand. Whether it yielded benefits in the British context worth the added costs is still debatable. Alternative approaches, such as creation and sale of a limited number of marketdefined, integrated franchises might have worked equally well if not better (Thompson, Louis S., Privatizing British Railways Are there lessons for the World Bank and its Borrowers? Transport Papers, World Bank, TP-2 September 2004).”
One of the lessons that the above World
Bank paper draws from the UK experience is the following:
“Bank clients that are not compelled to adopt the EU mandates to separate infrastructure from operations should carefully explore the alternatives before adopting the UK or EU approach. The vertically integrated (infrastructure and operations) freight and passenger concessions in Latin America furnish a very valuable alternative model where traffic is heavily freight or heavily passenger oriented, and where on-rail, intramodal competition is not an important objective. The model in which the dominant user is integrated with infrastructure, but other, sometimes competing, sometimes complementary, users are permitted access as tenants, also deserves strong consideration where there is a strongly dominant user and an effective regime of independent economic regulation to assure fair access for the tenants”.
On the question of independent infrastructure companies operating on a commercial basis and earning returns on the investment we have seen that the Australian Rail Track Corporation, while making cash profits is dependent on substantial grants from the government for sustaining its network. In the Member states of the EU the position is no different. Where separation has taken place the infrastructure is owned and maintained by public sector undertakings, and available evidence indicates that although they are not incurring cash loss, they are not generating enough revenue to give a return on the assets transferred to them and some of them continue to need periodic injection of capital from government.
There is overwhelming evidence from international experience that an undertaking entrusted with the ownership and maintenance of rail infrastructure is unlikely to be financially self-sufficient. Financial self-sustenance is even more unlikely in the case of a new entity, which is asked to undertake heavy investment at a time at which the market price of several inputs such as steel and cement are running at historically high levels
The Task Force considered the main models that are in existence in the world today and weighed the pros and cons of both vertically integrated and completely separated models. The vertically integrated model has its own advantage by way of synergy between infrastructure and operation but the disadvantage is that it does not allow above-rail competition. The separated model allows aboverail competition but suffers from the absence of synergy and also higher costs. The separated model encouraged by the EU has not been fully adopted by the major railway systems in the EU itself, as the only mandatory requirement is that the accounts be separated. Some of the leading and successful railway systems such as Japan and the USA have not gone in for institutional separation between infrastructure and operations.
The Task Force also considered a number of variants of the organizational structure in order to capture the benefits of different models in existence in the world today, including one in which the SPV would not only own the infrastructure but would also be the dominant operator, allowing the Indian Railways and other qualified operators to conduct business of freight movement and run trains in competition with it. However, the consensus in the end was that the SPV would be responsible only for the infrastructure and for the movement of trains on its system, while the Indian Railways and other qualified private and public operators would run trains on the tracks owned by the SPV. Thus the SPV would plan, build, own and maintain the infrastructure and move the trains on its system, but would not own or lease any rolling stock nor do any freight business other than haulage of freight trains.
The Task Force, therefore, recommends the adoption of the organizational model in which the SPV builds, owns and maintains the infrastructure and moves the train within the corridors on its system, while allowing non-discriminatory access to Indian Railways and other qualified private and public sector operators of goods trains within a regulatory framework.
The SPV would not own or lease any rolling stock nor do any freight business directly with clients. The ability of the SPV to run as a profit making commercial enterprise giving some returns on equity can be judged only after a feasibility report is received from RITES. However, having regard to international experience, it is likely that with this organizational structure, the SPV would require periodically to be granted substantial funds for capital improvements in its assets though such need for support would be mitigated by the density of traffic on these corridors. Despite the lack of assurance of a return on capital, the Task Force believes that the user PSUs would have sufficient stake in developing an efficient railway system for freight movement to be encouraged to contribute to the equity of the SPV.
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 17
In some countries roadways and waterways offer adequate inter-modal competition. While the extent of inter-modal in the Delhi-Howrah segment can be assessed only after the exact alignments of the corridor are known, the Task Force believes that on the Mumbai-Delhi segment trucks moving on the National Highways would offer enough competition to the dedicated freight corridor. With the broadening of the highways into sixlane recently announced by Government the competition would intensify.
The dedicated freight corridor could still manage to retain and even increase its share of the freight business if it can offer the reliability that the manufacturing industry would want in particular. The service could improve further if trucking and railway services complement each other in the transport of containers, for instance. Even if inter-modal competition can be expected to keep the dedicated freight corridor on its toes, allowing the Indian Railways and other players to operate on these tracks would increase market contestability further.
Market Contestability
The Task Force examined the question whether the existing infrastructure could be used for the dedicated freight corridor and new railway tracks constructed for passenger trains. It was pointed out that the existing infrastructure imposed significant technical constraints limiting the payload carrying capacity of freight trains. Axle Load permitted on the tracks is 20.3- 22.9 tonnes against 25 to 37.5 tonnes per axle carried by major freight carrying systems. The length of loops provided in yards and in stations is 686 metres, limiting the length of trains to 58 BOX ‘N’ wagons. Against this, heavy haul freight systems internationally carry more than 100 wagons, with the Australian system carrying over 300 wagons per train. The moving dimensions, which is the space envelope in which the locomotives, coaches or wagons have to be designed is restricted on the Indian railways.
The envelop in other countries is larger allowing use of wagons with higher crosssectional area permitting increased pay load in the same wagon. Payload to tare ratio i.e. the payload compared to empty weight of wagon is in the range of 4-7 internationally against 2.5 prevailing in India. The envelope cannot be increased as structures on the track like stations, platforms, roofs, bridges, tunnels, road over-bridges etc. have been constructed with clearances according to the current space envelope. The Railways may not be able to cope with the growth in container traffic of around 15% annually without double stack movement. Double stack container movement would not be possible due to the physical limitation imposed by the restrictive space envelope. Increasing clearances will mean large-scale investment in raising bridges, increasing width in platform areas, increasing height in platform areas, increasing height of electrical OHE, tunnel sizes etc.
The technical constraints indicated above limit the payload, which can be cleared in one train and consequently the throughput of the section. One train in Australia clears the same payload as would require 6-7 trains in India. Thus the sectional capacity gets vitiated on the Indian Railways due to extra trains being run. Making the existing tracks fit for high axle load, increasing loop length and clearing physical impediments on existing structures would not only be very difficult but extremely costly, and a big challenge in built-up urban/semi-urban areas. A dedicated freight corridor free from the technical limitations enumerated above and fit for high axle load, longer trains and larger clearances can be constructed afresh with little extra investment compared to normal track construction.
To summarize, the following are the major constraining factors on the existing high-density routes of Indian railways, which limit throughput, and which necessitate the construction of freight corridors on new alignments:
· The axle load limitation on the existing network is 20.3-22.9 tonnes against 30 tonnes and above in major freight carrying systems.
· The length of loops in yards and stations is limited to 686 metres against nearly double the figure in other freight carrying systems.
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 19
Whether the New Corridors Should
be for Freight or Passenger Trains
· The maximum moving dimensions allowed by the existing structures along the tracks, which determines the space envelope for the design of locomotives and wagons, is restricted and less than what is available even on the narrower standard gauge in other countries.
· Payload-to-tare ratio internationally is much higher than the existing 2.5 prevailing in the Indian railways.
The Task Force was of the view that establishing a new passenger corridor instead of a freight corridor was not tenable for a number of reasons. A high-speed passenger corridor needs a higher level of technology to provide the necessary safeguards towards safety, and other systems including coaches, locos and signaling etc. The high-speed train system between Mumbai and Ahmedabad that was proposed in the past was estimated to cost around Rupees 70 crores per km. For the Delhi-Mumbai and Delhi-Howrah passenger corridors, a total distance of 2800 kms, even at 50 % of the earlier estimate the project cost would be around Rs 100,000 crores. Against this the corresponding freight corridors are estimated to cost Rs 22500 crores. Given the magnitude of funds required for the passenger corridors, the project cannot be given priority over the freight corridors. As a matter of fact the Task Force was informed that at a meeting taken by the Finance Minister on 22 August 2005 the view had been taken that the decision on not taking up the dedicated passenger corridor was a settled issue.
To summarize, the dedicated freight corridors have to be preferred over high speed passenger corridors for the following reasons:
· The investment requirement to build passenger corridors is five times that required for freight corridors
· Simultaneously significantly heavy investments would be required to augment capacity on existing networks to cater to the freight business.
· Even after these investments physical limitations imposed by the restrictive space envelope would remain
· Investment for the dedicated high-speed passenger corridors would have relatively lower returns on capital, which the country can ill-afford.
DEDICATED FREIGHT CORRIDOR CORPORATION OF INDIA LTD
DFCCIL
Introduction
The Indian Railways constitute a critical component of India’s transport network, both for passenger as well as freight services. Railways are cost effective and also environment friendly. Yet, capacity and efficiency constraints in the freight segment have led to a significant shift from railways to road transport.
Renewed focus of the Railway Ministry on efficiency, customer care, and commercial principles is aimed at reversing this trend. The recent turn around in railway operations suggests that Indian Railways are poised for rapid growth in capacity expansion.
The high density Eastern and Western corridors are already saturated in terms of line capacity utilization. Accelerated growth of the economy is only adding to the congestion on these routes. A quantum jump in capacity is, therefore, necessary for meeting the rising freight demand on account of robust domestic growth as well as the rapid increase in international trade.
The objective of the project is to cope with the increase of freight transport demand in India by constructing new dedicated freight railway system, thereby promoting comprehensive regional economic development along the freight corridor, through improvement and modernization of inter-modal logistic system handling considerable freight.
The project is expected to augment the capacity of railway network to handle the large increase in freight traffic over the coming years. The DFC would enable freight trains to run at 80-90 km per hour, compared with the present speed of 25-30 km per hour.
Task force on dedicated freight corridors:
The Task Force Report suggests an institutional roadmap for the construction and operation of the dedicated freight corridors. These corridors would be constructed, operated and maintained by a corporate entity on commercial principles while relying on efficient technological solutions. Scarce budgetary resources would be leveraged for raising debt from the markets, based on a sound business plan.
The proposed corporate entity would provide the rail infrastructure, but would not itself engage in freight business, thus providing non-discriminatory track access on payment of haulage charges by train operators. This approach would herald large scale private investment and competition in freight operations. This underlying separation of rail from wheels would also mark a paradigm shift in the functioning of Indian Railways who have already introduced private participation and competition in movement of container trains. (Gajendra Haldea)
The Dedicated Freight Corridor Corporation of India is a corporation managed by the Government of India to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. DFCC has been registered as a company under the Companies Act 1956 on 30th October 2006. “Dedicated Freight Corridor Corporation of India Limited (DFCC)” is a special purpose vehicle created to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. DFCC has been registered as a company under the Companies Act 1956 on 30th October 2006.
Over the decades, in order to keep populist election agenda, the passenger fares are slightly touched in spite of spiraling input cost. The loss sustained in the passenger fares is cross-subsidized by enormous increase in the freight tariff
Ministry of Railways have planned to construct a new Dedicated Freight Corridor (DFC) covering about 2762 route-km on two corridors, Eastern Corridor from Ludhiana to Haldia and Western Corridor from Jawahar Lal Nehru Port Mumbai to Tughlakabad/Dadri along with interlinking of two corridors at Khurja. Upgradation of transportation technology, increase in productivity and reduction in unit transportation cost are the focus areas for the project.
Need for Dedicated Freight Corridor Project
Economic liberalization policies of 1991 followed by information technology explosion have taken India to a new growth scenario. Backed by strong fundamentals and commendable growth in the past three to four years, the resplendent Indian Economy is poised to grow even further at an average of 8 to 10% in the next 3 years.
Transport requirement in the country, being primarily a derived demand, is slated to increase with elasticity of 1.25 with GDP growth by 10 to 12% in the medium and long-term range. Riding on the waves of economic success, Indian Railways has witnessed a dramatic turn around and unprecedented financial turnover in the last two and a half years.
This has been made possible by higher freight volumes without substantial investment in infrastructure, increased axle load, reduction of turn-round time of rolling stock, reduced unit cost of transportation, rationalization of tariffs resulting in improvement in market share and improved operational margins. Over the last 2 to 3 years, the railway freight traffic has grown by 8 to 11%, which is projected to cross 1100 million tonnes by the end of XI Five Year Plan.
The Indian Railways’ quadrilateral linking the four metropolitan cities of Delhi, Mumbai, Chennai and Howrah, commonly known as the Golden Quadrilateral; and its two diagonals (Delhi-Chennai and Mumbai-Howrah), adding up to a total route length of 10,122 km carries more than 55% of revenue earning freight traffic of IR.
The existing trunk routes of Howrah-Delhi on the Eastern Corridor and Mumbai-Delhi on the Western Corridor are highly saturated, line capacity utilization varying between 115% to 150%. The surging power needs requiring heavy coal movement, booming infrastructure construction and growing international trade has led to the conception of the Dedicated Freight Corridors along the Eastern and Western Routes.
Almost simultaneously, the Cabinet approved the report of the Task Force of the COI, which directed that a SPV should be set up to construct and operate the DFC. Cabinet Committee on Economic Affairs (CCEA) gave "in principle" approval to the Feasibility Study report asking the MOR to go ahead with Preliminary Engineering cum Traffic Survey (PETS) for the two corridors, firm up the cost of the project and work out the financing options. In consonance with the recommendation of the Task Force of COI, a SPV, named "Dedicated Freight Corridor Corporation of India Limited (DFCCIL)" was incorporated under Companies Act in October 2006. Subsequently, RITES submitted the PETS Report based on which the project was approved at a cost of Rs. 28,181 Crore.
Funding the Project:
The railways are likely to secure a loan of Rs 37,200 crore from multilateral institutions, including the World Bank and the Asian Development Bank (ADB). The amount is expected to take care of the construction of about 76 per cent of the proposed 2,739-km dedicated rail freight corridor (DFC). The Japan International Cooperation Agency (JICA) has already committed a loan of Rs 18,000 crore at an interest rate of 0.2 per cent for funding the 920-km stretch between Rewari and Vadodara on the proposed western dedicated freight corridor. The final agreement between the JICA and the railways is expected in the first quarter of 2009-10. Meanwhile, the World Bank has given its approval in principle for a loan of Rs 12,000 crore for the 730-km Mughalsarai-Khurja section, while the ADB has shown an interest in lending Rs 7,200 crore to finance the 430-km stretch between Khurja and Ludhiana. Both these stretches fall on the proposed 1,256-km eastern freight corridor between Ludhiana and Howrah.
“The rate of interest at which the World Bank and the ADB will advance these loans is likely to be 5.5 per cent. We have already started the process of negotiations with these institutions and a final agreement will be signed by the end of 2009,” said a senior official of Dedicated Freight Corridor Corporation of India Ltd (DFCCIL).
As part of the World Bank funding programme, DFCCIL has appointed a consortium of consultants which includes Parsons Brinkerhoff India, Halcrow, Wilber Smith and Lee Associates for system design, finalization of bid documents and supervision of the construction of the 300-km Khurja-Kanpur section on the eastern dedicated freight corridor.
“We have already submitted the draft pre-qualification document for design and build contract to the World Bank. The bidding process for the same is likely to commence by March 2009,” said the DFCCIL official.
Meanwhile, a technical assistance team from the ADB has held consultations with senior members of the Railway Board and DFCCIL. Following this, the ADB has proposed to provide technical assistance for undertaking a feasibility study of the Ludhiana-Khurja section.
A JICA report has estimated the total cost of constructing both western and eastern freight corridors at Rs 37,218 crore.
The debt-equity ratio of the project has been decided at 2:1. The railways will bring in the equity part.
“The commitments from multilateral institutions are a little higher than the estimated requirement. Since the project will be implemented over the next six years, there is always a chance of cost escalation. In such a scenario, it will be easy for them to lend more without going through the approval process,” said the DFCCIL official.
The Government of Japan has committed an amount of 2,606 million yen for the Engineering Services Loan under Dedicated Freight Corridor Project (Phase-I).
Structure of SPV:
The mechanism of SPV, owned jointly by the Indian Railways and the users of bulk freight services (e.g. port operators, shipping companies, oil companies, coal, iron ore and steel companies as well power companies, largely in the public sector) should be entrusted with the task of planning, construction and maintenance of infrastructure. The SPV will also be responsible for movement of trains on its system and operation of the dedicated freight corridors.
The Ministry of Railways should be the administrative Ministry for the SPV. In order to ensure that the SPV has effective independence in decision-making and is able to function with a market focus and business orientation it should have sufficient autonomy, delegation and flexibility in conducting its business.
The coming together of the Railways and mainly public sector undertakings that are bulk users of freight services, with some topping up by the Central Government, would ensure an adequate equity base, which could be leveraged for market borrowings for raising enough capital for investment in the dedicated freight corridor.
The Task Force considered the two broad models that are in existence in the world today and weighed the pros and cons of both vertically integrated and completely separated models. The vertically integrated model has its own advantage by way of synergy between infrastructure and operation but the disadvantage is that it does not allow above rail competition. The separated model allows above rail competition but suffers from the absence of synergy and also higher costs.
The Task Force recommends the adoption of a model, which captures the benefits of both the models. The SPV, which would own and maintain the track and other infrastructure, would also move the trains within the corridor on its system, but would not own or lease any rolling stock nor do any freight business other than haulage of freight trains. The Indian Railways and other qualified operators would run goods trains on the tracks of the corridors and would be given nondiscriminatory access for this purpose.
Whether the existing corridor should be used for the dedicated freight corridor and a new one constructed for the passenger corridor
Due to the major constraining factors on the existing high-density routes of Indian railways, which limit throughput, the dedicated freight corridors need to be constructed on new alignments. Augmenting freight capacity on existing network would involve significantly heavier investments. Furthermore the investment in dedicated high-speed passenger corridor would give relatively lower returns on capital.
It is widely recognized that in order to improve the performance of the Indian Railways it must be run on business lines and must become customer-oriented and market driven. At present the Indian Railways is not in a position to run purely on a commercial basis because it has social responsibilities.
The Indian Railway system has a dual role:
It provides commercial services while at the same time it performs a number of useful social functions. Activities such as movement of freight in general and of some classes of passengers are carried out on a commercial basis, but the Indian Railways also run suburban and other passenger services below cost, transport essential commodities at a loss, run branch lines that are not remunerative and are expected to provide increasing employment opportunities to the population. While the Railways cannot be absolved of these responsibilities, it is necessary for its efficient functioning, that the two roles are separated to the extent possible.
Railways (Rakesh Mohan Committee), since the objectives of commercial activities are different from those for social activities, separate parameters are needed to assess performance. Commonly accepted financial parameters like revenues, profits, return on capital employed etc. are appropriate to assess performance of the commercial projects. For social projects, operational parameters such as improvement in connectivity and punctuality, increase in traffic etc. could be used. Segregation of these two categories of activities and functions over the Indian Railways across-the-board is a formidable task. However, the dedicated freight corridors present a good opportunity to make a beginning by setting up an independent organization for its establishment and operation.
In India the railways have been losing freight business to roadways, although less rapidly than in advanced countries. Railways retain their relative advantage mainly in natural resource and intermediary goods markets in which there are large volume movements and relatively low value-to-weight ratios and tend to lose it as the value-to-weight ratios of manufactured commodities increases unless they can provide high quality container services particularly on medium and long hauls. In order to retain and even increase market share the Railways need to be repositioning itself all the time in order to meet the challenge of competition from the road sector. For that it needs a market focus in its operation. In the new organization for the dedicated freight corridor it should be possible to undertake periodic performance-review and problem solving sessions with major clients to improve the service. Information may need to be collected on the enterprise’s competitive position vis-Ã -vis the roadways sector, and improvements undertaken.
The competitive pressure on Indian Railways will increase with the further upgradation of the National Highways on the Golden Quadrilateral, which is now being taken up for six-laning. In order to compete with the roadways it would be necessary not only to lower price but also to improve performance
Generally in accordance with the requirement of the clientele. According to a nation-wide survey of users of rail freight services conducted in 1997, the results of which are mentioned in the Rakesh Mohan Committee Report, the Indian Railways was rated below roadways on all parameters viz., reliability, availability, price, time, connectivity, suitability, damages, information sharing, adaptability, cost-friendliness, negotiability, access to officials, ease of payment and claim time. These aspects can be addressed more efficiently in an independent organization operating services in the dedicated freight corridors than in a very large organization like the Indian Railways.
Following the initiation of economic reforms in 1991, India has been gradually increasing its integration into the world economy. With the abolition of import licensing and the gradual reduction in customs duties, Indian manufactures have to compete with foreign manufactures not only in foreign markets but in the domestic market as well. Unless the Indian industry has the benefit of world-class services at internationally competitive prices, it would not be able to compete with its foreign counterparts. In India many production centers are situated away from the ports and production and consumption centres are also far apart. In this situation it is not simply the cost of transport that matters. Equally important is the quality and reliability of service. In an increasingly competitive environment the Indian industry has to keep its inventories of raw materials and intermediate products down and keep pace with the imperatives of just-in-time manufacturing. All that is not possible if a reliable transporter does not back the supply chain of industrial goods. Unless its performance is improved through the adoption of a customs-oriented approach, in providing particularly on-time services, the Indian Railways cannot provide that type of service.
In recent years, the Indian Railways has taken a number of steps to improve its services, with the result that its physical and financial performance has shown marked improvement. This is a welcome development. However, the Railways has to do much more to improve the quality of its services. A separate new organization, which is not burdened with the task of balancing the conflicting objectives, would be in a much better position to follow a market savvy approach and lift the standard of service significantly.
The Task Force noted that the development of a dedicated freight corridor is highly capital intensive. The provision of such a corridor and its operation must be on commercial principles if quality services are to be provided on a sustainable basis. This would require setting up of higher productivity standards, entailing the adoption of norms, benchmarks, policies and practices, which may be significantly different from what are being followed by the Indian Railways.
Finally, the investment requirement of the freight corridors is currently estimated to be at least about Rupees 22,500 crore, although the RITES study now under way might well result in a higher estimate. The project would take at least five years for implementation (after the new organizational structure is established, project report finalized, approval obtained and funding firmed up) and assuming that the current estimates are correct, the average annual requirement would work out to more than Rupees 4500 crore. This requirement would be over and above the normal requirements of the Railways for renewal and replacement, acquisition of rolling stock, multiplexing, modernization, projects for new lines and conversion into broad gauge etc. There are constraints in the Central Government allocating and in the Railways generating funds of this magnitude. The prospect of the Japanese Government providing assistance for the dedicated freight corridors is being explored. A final picture in this regard will emerge only after a study commissioned by the Japanese International Co-operation Agency (JICA) is completed. The current assessment is that the aid, if forthcoming, will be available in two to three years.
In light of the above an independent commercial organization, capable of raising funds from the domestic capital market appears to be the only feasible option. Such an organization would be able to leverage equity of say about Rupees 7,500 crore to raise a debt for the remaining requirement of Rupees 15,000 crore and finance the project. A departmental enterprise of the Ministry of Railways may not be able to raise loan from the domestic capital market, but a separate corporate entity will, if it inspires confidence in its ability to run as a commercially viable undertaking. Worldwide railway undertakings, particularly those that also take up infrastructure development, have generally not been able to run as profit-making commercial enterprises. Recovery of capital spent on the infrastructure has not been accomplished and capital grants from the Government have been the general practice
Having regard to the factors considered above, a Special Purpose Vehicle (SPV) would seem to be best suited to carry out the task of planning, construction and operation of the dedicated freight corridor. Should the SPV be owned fully by the Indian Railways or should it have a more diversified ownership? The Task Force believes that a more diversified ownership with other stakeholders, mainly from the public sector, as investors in equity would be in the best interest of efficient management of the freight corridor, besides generating the requisite equity fund. Some of the stakeholders identified for the purpose are the port operators including Port Trusts, shipping and shipping-related companies, oil companies, coal, iron ore and steel companies, such as CCL and SAIL and NMDC, and power companies such as the NTPC.
It would be recalled that the Department of Shipping had at one time indicated that port operators/ shipping companies were interested in constructing and operating the freight corridor between Delhi and Mumbai. The oil companies are likely to continue as one of the main users of the railway system even as they make increasing investments in pipelines. CCL, SAIL, NMDC and NTPC would have a major stake in the development of many segments of the Eastern Corridor, but to motivate them to make investments, it would be necessary to take their requirements into consideration while deciding on the alignment.
Even though the Task Force believes that the SPV could be viable as a commercial undertaking, it does not consider that at the outset it would generate interest among private sector investors, except a few entities already in transport business. The investment would have to be made principally by the Railways and the public sector companies named above. The Task Force recommends that the equity be shared between the Railways (including its subsidiaries) and the other stakeholders, mainly the bulk users of freight services among the PSUs. The Central Government could come in for meeting any shortfall in equity that might arise.
Participation of the above-mentioned stakeholders would serve two ends. First, the burden on the Railways for making a large equity investment would be reduced and the funds available with public sector undertakings would be utilized. Second, financial participation by users of freight services would bring to the boardroom the much needed customer orientation and help to bring a market focus in the working of the organization.
It will be ensured that the SPV functions fully as an independent commercial enterprise. The Ministry of Railways should be the administrative Ministry for the SPV. The appointment and number of functional Directors should adhere to PESB guidelines. Further, the Ministry of Railways should nominate one part-time Director as stipulated in the PESB guidelines. Similarly, appointment of independent Directors should also be governed by PESB guidelines.
The Task Force recommends that in order to help ensure the requisite volume of financing
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 9
as well as to provide adequate representation of other stakeholder interests, the Board should have a nominee each from the Finance Ministry and Planning Commission. However, the representative of Railways Ministry expressed reservations.
Separation of Infrastructure from Operation
The Task Force considered the option of separation of control and management of the railway track and associated infrastructure on the one hand and above-rail operators (i.e. operators of rolling stock) which have been provided access, on the other. Such separation is considered by some as ideal for unleashing above-rail competition for greater efficiency. A situation in which no rail operator controls the infrastructure can ensure equality of access.
The Task Force reviewed the international experience in this regard. There are three basic models in existence.
First is the vertically integrated structure, as in China, Russia, India, Brazil, Mexico, and Argentina, to name a few countries with large railway systems. Where publicly owned some of the railway systems are run either directly by Ministries or by corporate units or organizations owned by Government. In Russia, China and India the State-owned companies are horizontally integrated, while in Brazil, Mexico and Argentina there are many privately owned regional companies. In other instances, the integrated railways are run by the private sector on the basis of concessions or franchises awarded by the government owner. In yet other cases, the integrated structure is owned and managed by the private sector.
Second is the structure in which the dominant user is integrated with infrastructure while incremental users have access for which they pay access fees. The best example of this is in the US, in which one vertically integrated freight railway uses the infrastructure of another vertically integrated freight railway without much difficulty. Further the Amtrak under public ownership runs its passenger trains over the tracks of the privately owned freight railways. In Japan, the Japan Rail Freight Corporation runs as a Government undertaking on infrastructure owned by privatized regional undertakings, which carry passengers. This model has also been adopted in Canada, Mexico and other countries.
Third is the model in which the infrastructure is separated from the users but remains accessible to all under an access regime. We are familiar with this model in the roadways and airports, but in recent times it has been advocated as one of the ways of restructuring railways. The European Union has adopted this model progressively since 1991, but infrastructure and operations were genuinely split in a number of other countries even earlier.
In all these countries both the infrastructure and operations remained mainly under public ownership. The British Government, although a member of the European Union, went far beyond others in establishing a separate infrastructure enterprise in onjunction with one or more freight companies, intercity passenger companies, and a number of regional or suburban passenger companies, which were all privatized. The British experiment was unique in that the infrastructure company was also privatized. However, the experiment for privatization of the infrastructure was not successful and the privatized infrastructure company became bankrupt and had to be renationalized. It should be noted that even when the infrastructure company in Britain was The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 11 privatized more than a third of its income came from state subsidies to train operators, which were passed through. The bankruptcy was a direct consequence of the Government turning off the tap.
The experience of separation in Australia also has a similar lesson. A World Bank Report (TP-7 OF September 2005) on the experience of restructuring in the Australia and New Zealand, has come to the following conclusion on the operation of the Australian Rail Track Corporation (ARTC), which was established in 1998 to manage access and infrastructure development on the interstate track:
“The publicly owned ARTC, which manages many of the higher density interstate rail corridors in Australia, has been cash positive but earns significantly less than the replacement cost of its assets, and over the longer term will require some public funding to sustain and enhance its network. The Australian Government has already committed to significant grants to uplift the quality and performance of the interstate rail network, including improving access into the congested Sydney network. However, as volumes increase the commercial performance of the ARTC, which has spare capacity and largely fixed costs, will improve.”
The European Union has been moving towards separation since 1991. Article I of the Council Directive of 29 July 1991 on the development of the Community’s railways (91/440/EEC) explains both the aim and the content of the directive.
“Article I
The aim of this Directive is to facilitate the adoption of the Community railways to the needs of the Single Market and to increase their efficiency;
· by ensuring the management independence of railway undertakings;
· by separating the management of railway operation and infrastructure from the provision of railway transport services, separation of accounts being compulsory and organizational or institutional separation being optional,
· by improving the financial structure of undertakings, -by ensuring access to the network of Member states for international groupings of railway undertakings and for railway undertakings engaged in the international combined transport of goods. Article 6 of the Directive mandated Member States to ensure that ‘the accounts for business relating to the provision of transport services and those for business relating to the management of railway infrastructure are kept separate. Article 10 directed that international groupings must be granted access and transit rights in all Member states in respect of international services.”
Member States implemented the Directive in various ways. We have seen that the British Government not only brought about a total separation but also broke up the two segments into multiple private companies. Sweden had initiated action for setting up separate public sector undertakings for infrastructure (Banverket) and operations (SJ) even before it acceded to the European Union in 1995. On 29 April 2004 the European Union moved further for bringing about enhanced access. By the Council Directive 2004/51/EEC the European Parliament and the Council of the European Union required not only that railway undertaking must continue to be granted access to the Trans-European Rail Freight Network but also they must be given access for the purpose of operating all types of rail freight services.
While the European Union is committed to forge ahead with the separation model, reviews of the implementation of the policy seem to indicate that in railway circles there is considerable doubt on the acceptability of the separation model as the superior option. A recent publication states that “no clear view emerges on the ‘best’ model (integrated or separated)” (Community of European Railway and Infrastructure Companies 2005, Reforming European Railways- An assessment of progress, Eurorail Press, Hamburg). Another publication, of which the author was Director of the Public Transport Union in Switzerland from 1969 to 2000, is more forthright in his assessment. “As does the generally known situation in Great Britain, also this analysis of the seven countries with institutional separation gives proof of the fact that separation has no benefits. It only brings serious problems” (Pfund, Carlo, Separation Philosophy of the European Union-Blessing or Curse, Service D’Information Pour Les Transports Publics).
A communication from the Executive
Director of the Community of European Railway and Infrastructure Companies (CER) in Brussels addressed to the Chairman of the Task Force states:
“There is no empirical evidence in Europe that separation between infrastructure and operating services leads to real improvements in the railway system: just the other way around.” The same communication brings out the following facts:
· The CEO of the most successful railway company in Europe (in terms of capacity utilization, customer satisfaction, quality, etc.)- the Swiss railway company SBB believes that the high quality of SBB rail services is only possible because he can optimize simultaneously the synergy of infrastructure and operation within one company under one management.
· Despite the EU move towards separation almost all countries in the centre of Europe - i.e. those companies experiencing a high density of rail traffic - have retained the model of integrated holding companies (Germany, Poland, Switzerland, Austria, Italy, Belgium, Luxembourg) in order to maintain a high efficiency and productivity of the railway system as a whole. Separation has been effected mainly in countries at the periphery of Europe, i.e. without transit traffic and with considerably lower traffic intensity.
· The experience in quite a number of European countries (Germany, Switzerland,
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 13
Austria, Italy, Poland, etc.) has shown however that the objective of competition can be achieved without giving up the model of an integrated company. The Deutsche Bahn has the full responsibility for the rail infrastructure, but shares the offering of railway services today with 290 other rail companies having a railway company licence for the German network. A well functioning regulatory framework defines the general rules for the access to the rail infrastructure - rules to be applied by Deutsche Bahn, which is supervised in this respect by a German public rail authority.
In order to get over the handicaps of separation, efforts are underway to reinforce again cooperation and links between the separated units in order to regain the interdependencies and synergies of the railway system. Publications on the subject of railway organization have also brought up some other relevant facts:
· Even where separation has taken place sometimes it is more in form and less in substance. In France the infrastructure company, RFF, owns the infrastructure assets but maintenance of the infrastructure as well as operations is handled fully by SNCF, the National Railway System. RFF defines the principles and objectives of traffic management and direction, and SNCF is the delegated infrastructure operator contracted for operation and maintenance. Thus SNCF is formally separate but materially integrated (Pfund, Carlo, Separation Philosophy of the European Union- Blessing or Curse).
· Studies by scholars show that an integrated structure produces a cost saving of 27 per cent over a separated system (Ivaldi, M. and McCullough, G., 2002, Subadditivity tests for network separation, mimeo Toulouse and Northwestern University, cited in Reforming Europe’s Railways –An assessment of progress, Eurail Press, 2005)
The concept of synergy between infrastructure and operation is also referred to by experts as rail-wheel interaction and has been explained at length as follows:
Optimization of train operation on the network
The railway functions as a system of vehicles, infrastructure, and operation control technology, like a machine. Only through a combined working of all the elements of the technical system, operational reliability and safety can be guaranteed. This is where the railway differs from other transport modes. By means of permanent central coordination, including the use of modern telematics, the system can be optimized and can thus guarantee maximal efficiency and punctuality. By way of central coordination, headways of trains can be shortened until braking distance, timetables can be harmonized, and efficient measures can be taken in the event of incidents. Modern technology and traffic control systems make it possible to reduce headways between trains, to speed up vehicle turn-round cycles and to reduce the vehicles fleet held in reserve.
The optimal run of operations is only guaranteed by the integration of operations and infrastructure. Only a technically integrated
Report of the Task Force enterprise can assume full responsibility towards the customers for its run of operations.
Further technical development of the comprehensive railway system
Until technical innovations and adaptions in the railway world can finally be put into practice, they are subject to an onerous harmonization process. Different groups are involved in the elaboration of the service product, groups whose interests are not necessarily quite the same. An integrated enterprise, in its decision oriented towards the technical and economical overall optimum, can implement necessary innovations quickly and can assume responsibility for the investment risk. Railway offers that are competitive for a long time presuppose a permanent further development of the compound system railway as a homogenous whole. The other transport modes are developing themselves further at breakneck speed. In this innovation race, the railway can only stand its ground if technologies in the infrastructure, as well as in the vehicles, are developed further at the same speed and in a concerted way. High-speed lines and trains, the safety system ETCS, and the digital GSM-R radio communication system connected with it, all have been planned and developed by integrated railway enterprises.
Guaranteeing a high safety standard in the use of the latest technology
Train traffic puts special demands on observance of safety standards in the systemspecific interplay of wheel, rail and control technology. Also, if high safety standards can be defined or be monitored by a political authority, a clear responsibility for safety must in the final analysis be discernable. If one considers the implication in the case of accidents, a fragmentation of responsibility between operations and infrastructure must be doubly rejected. Overall responsibility for train operations can only be assumed by the manager or managing body who can control and supervise all safety-relevant influence factors. (Pfund, Carlo, Separation Philosophy of the European Union - Blessing or Curse, Service D’Information Pour Les Transports Publics).
The experience of British Rail in separation also has some lessons. AWorld Bank Report drew inter alia the following conclusion on this:
“Separation of infrastructure from operations did cause problems of complexity and cost (transaction costs). It did not cause increased accidents and it did not support an increase in demand. Whether it yielded benefits in the British context worth the added costs is still debatable. Alternative approaches, such as creation and sale of a limited number of marketdefined, integrated franchises might have worked equally well if not better (Thompson, Louis S., Privatizing British Railways Are there lessons for the World Bank and its Borrowers? Transport Papers, World Bank, TP-2 September 2004).”
One of the lessons that the above World
Bank paper draws from the UK experience is the following:
“Bank clients that are not compelled to adopt the EU mandates to separate infrastructure from operations should carefully explore the alternatives before adopting the UK or EU approach. The vertically integrated (infrastructure and operations) freight and passenger concessions in Latin America furnish a very valuable alternative model where traffic is heavily freight or heavily passenger oriented, and where on-rail, intramodal competition is not an important objective. The model in which the dominant user is integrated with infrastructure, but other, sometimes competing, sometimes complementary, users are permitted access as tenants, also deserves strong consideration where there is a strongly dominant user and an effective regime of independent economic regulation to assure fair access for the tenants”.
On the question of independent infrastructure companies operating on a commercial basis and earning returns on the investment we have seen that the Australian Rail Track Corporation, while making cash profits is dependent on substantial grants from the government for sustaining its network. In the Member states of the EU the position is no different. Where separation has taken place the infrastructure is owned and maintained by public sector undertakings, and available evidence indicates that although they are not incurring cash loss, they are not generating enough revenue to give a return on the assets transferred to them and some of them continue to need periodic injection of capital from government.
There is overwhelming evidence from international experience that an undertaking entrusted with the ownership and maintenance of rail infrastructure is unlikely to be financially self-sufficient. Financial self-sustenance is even more unlikely in the case of a new entity, which is asked to undertake heavy investment at a time at which the market price of several inputs such as steel and cement are running at historically high levels
The Task Force considered the main models that are in existence in the world today and weighed the pros and cons of both vertically integrated and completely separated models. The vertically integrated model has its own advantage by way of synergy between infrastructure and operation but the disadvantage is that it does not allow above-rail competition. The separated model allows aboverail competition but suffers from the absence of synergy and also higher costs. The separated model encouraged by the EU has not been fully adopted by the major railway systems in the EU itself, as the only mandatory requirement is that the accounts be separated. Some of the leading and successful railway systems such as Japan and the USA have not gone in for institutional separation between infrastructure and operations.
The Task Force also considered a number of variants of the organizational structure in order to capture the benefits of different models in existence in the world today, including one in which the SPV would not only own the infrastructure but would also be the dominant operator, allowing the Indian Railways and other qualified operators to conduct business of freight movement and run trains in competition with it. However, the consensus in the end was that the SPV would be responsible only for the infrastructure and for the movement of trains on its system, while the Indian Railways and other qualified private and public operators would run trains on the tracks owned by the SPV. Thus the SPV would plan, build, own and maintain the infrastructure and move the trains on its system, but would not own or lease any rolling stock nor do any freight business other than haulage of freight trains.
The Task Force, therefore, recommends the adoption of the organizational model in which the SPV builds, owns and maintains the infrastructure and moves the train within the corridors on its system, while allowing non-discriminatory access to Indian Railways and other qualified private and public sector operators of goods trains within a regulatory framework.
The SPV would not own or lease any rolling stock nor do any freight business directly with clients. The ability of the SPV to run as a profit making commercial enterprise giving some returns on equity can be judged only after a feasibility report is received from RITES. However, having regard to international experience, it is likely that with this organizational structure, the SPV would require periodically to be granted substantial funds for capital improvements in its assets though such need for support would be mitigated by the density of traffic on these corridors. Despite the lack of assurance of a return on capital, the Task Force believes that the user PSUs would have sufficient stake in developing an efficient railway system for freight movement to be encouraged to contribute to the equity of the SPV.
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 17
In some countries roadways and waterways offer adequate inter-modal competition. While the extent of inter-modal in the Delhi-Howrah segment can be assessed only after the exact alignments of the corridor are known, the Task Force believes that on the Mumbai-Delhi segment trucks moving on the National Highways would offer enough competition to the dedicated freight corridor. With the broadening of the highways into sixlane recently announced by Government the competition would intensify.
The dedicated freight corridor could still manage to retain and even increase its share of the freight business if it can offer the reliability that the manufacturing industry would want in particular. The service could improve further if trucking and railway services complement each other in the transport of containers, for instance. Even if inter-modal competition can be expected to keep the dedicated freight corridor on its toes, allowing the Indian Railways and other players to operate on these tracks would increase market contestability further.
Market Contestability
The Task Force examined the question whether the existing infrastructure could be used for the dedicated freight corridor and new railway tracks constructed for passenger trains. It was pointed out that the existing infrastructure imposed significant technical constraints limiting the payload carrying capacity of freight trains. Axle Load permitted on the tracks is 20.3- 22.9 tonnes against 25 to 37.5 tonnes per axle carried by major freight carrying systems. The length of loops provided in yards and in stations is 686 metres, limiting the length of trains to 58 BOX ‘N’ wagons. Against this, heavy haul freight systems internationally carry more than 100 wagons, with the Australian system carrying over 300 wagons per train. The moving dimensions, which is the space envelope in which the locomotives, coaches or wagons have to be designed is restricted on the Indian railways.
The envelop in other countries is larger allowing use of wagons with higher crosssectional area permitting increased pay load in the same wagon. Payload to tare ratio i.e. the payload compared to empty weight of wagon is in the range of 4-7 internationally against 2.5 prevailing in India. The envelope cannot be increased as structures on the track like stations, platforms, roofs, bridges, tunnels, road over-bridges etc. have been constructed with clearances according to the current space envelope. The Railways may not be able to cope with the growth in container traffic of around 15% annually without double stack movement. Double stack container movement would not be possible due to the physical limitation imposed by the restrictive space envelope. Increasing clearances will mean large-scale investment in raising bridges, increasing width in platform areas, increasing height in platform areas, increasing height of electrical OHE, tunnel sizes etc.
The technical constraints indicated above limit the payload, which can be cleared in one train and consequently the throughput of the section. One train in Australia clears the same payload as would require 6-7 trains in India. Thus the sectional capacity gets vitiated on the Indian Railways due to extra trains being run. Making the existing tracks fit for high axle load, increasing loop length and clearing physical impediments on existing structures would not only be very difficult but extremely costly, and a big challenge in built-up urban/semi-urban areas. A dedicated freight corridor free from the technical limitations enumerated above and fit for high axle load, longer trains and larger clearances can be constructed afresh with little extra investment compared to normal track construction.
To summarize, the following are the major constraining factors on the existing high-density routes of Indian railways, which limit throughput, and which necessitate the construction of freight corridors on new alignments:
· The axle load limitation on the existing network is 20.3-22.9 tonnes against 30 tonnes and above in major freight carrying systems.
· The length of loops in yards and stations is limited to 686 metres against nearly double the figure in other freight carrying systems.
The Delhi-Mumbai & Delhi-Howrah Freight Corridors • 19
Whether the New Corridors Should
be for Freight or Passenger Trains
· The maximum moving dimensions allowed by the existing structures along the tracks, which determines the space envelope for the design of locomotives and wagons, is restricted and less than what is available even on the narrower standard gauge in other countries.
· Payload-to-tare ratio internationally is much higher than the existing 2.5 prevailing in the Indian railways.
The Task Force was of the view that establishing a new passenger corridor instead of a freight corridor was not tenable for a number of reasons. A high-speed passenger corridor needs a higher level of technology to provide the necessary safeguards towards safety, and other systems including coaches, locos and signaling etc. The high-speed train system between Mumbai and Ahmedabad that was proposed in the past was estimated to cost around Rupees 70 crores per km. For the Delhi-Mumbai and Delhi-Howrah passenger corridors, a total distance of 2800 kms, even at 50 % of the earlier estimate the project cost would be around Rs 100,000 crores. Against this the corresponding freight corridors are estimated to cost Rs 22500 crores. Given the magnitude of funds required for the passenger corridors, the project cannot be given priority over the freight corridors. As a matter of fact the Task Force was informed that at a meeting taken by the Finance Minister on 22 August 2005 the view had been taken that the decision on not taking up the dedicated passenger corridor was a settled issue.
To summarize, the dedicated freight corridors have to be preferred over high speed passenger corridors for the following reasons:
· The investment requirement to build passenger corridors is five times that required for freight corridors
· Simultaneously significantly heavy investments would be required to augment capacity on existing networks to cater to the freight business.
· Even after these investments physical limitations imposed by the restrictive space envelope would remain
· Investment for the dedicated high-speed passenger corridors would have relatively lower returns on capital, which the country can ill-afford.
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