At a high level meeting in the Presidency to discuss woes of Pakistan Railways, President Asif Ali Zardari advised the government to release Rs3.5 billion within 7 days for payment of salaries and pension of the railway employees who have been agitating against non-payment of salaries to them.
The President advised the government to arrange a loan of Rs6 billion for the purchase and repair of locomotives as well as purchase of diesel. The government would borrow Rs6 billion from Commercial Banks. Railways need Rs800 million monthly for fuel and by getting the money all suspended trains would come back on track within 3 to 4 month time, an official source said while talking to Profit.
The President gave this directive when the Railways Minister Haji Ghulam Ahmed Bilour pointed out that because of non-availability of locomotives, the freight trains had been suspended and the revenue from cargo transportation had come down from Rs9 billion a year to almost zero at present. He said that cargo service was the most critical element of Pakistan Railways to generate finances not only to support itself but also to make great profits.
Salvaging Pakistan Railways
Monday’s meeting had been convened especially to examine proposals for salvaging Pakistan Railways with the help of private sector from the abyss into which it had fallen. Private sector entrepreneurs were also invited to the meeting to discuss public-private partnership model for revamping railways, he said. It was decided that over Rs40 billion outstanding over-draft obtained from the State Bank of Pakistan (SBP) for which railway has been paying Rs350 million per month will be taken up in the Council of Common Interests as Railways services were utilised by all the provinces and the issue was inter-provincial in nature. It was also decided that a meeting of private and public sector representatives be held at the earliest to firm up proposals of private sector participation in revamping and restructuring of Pakistan Railways to turn the loss making PSE into a real profitable venture. The proposals will be finalised within a month, it was decided.
Public-private partnership
The meeting that was held to deliberate upon the current challenges faced by the organisation was attended by Haji Ghulam Ahmed Bilour, Federal Minister for Railways, Dr Abdul Hafeez Sheikh, Finance Minister, Mr M. Salman Faruqui, Secretary General, Dr Nadeem ul Haq, Deputy Chairman Planning Commission, Federal Secretaries of Railways, Finance, Planning & Development divisions besides secretary EAD, Mir Ahmed Bakhsh Lehri, Chief Secretary Balochistan and Spokesperson to the President Mr Farhatullah Babar and other senior officials. Chairman Arif Habib Group of Companies Arif Habib, and Chairman ARD Group of Companies Mr Aqeel Karim Dhedi, were also present during the meeting as special invitees to give inputs on the role private sector could play in turning around the public sector enterprise. The President said that Pakistan Railways was an area where there were great opportunities for public private partnership. He said that locomotive rehabilitation, outsourcing of maintenance, commercialisation of passenger services and leasing of the locomotives are some of the areas in which private sector can join hands with the public sector in a mutually beneficial partnership.
Finding a permanent solution
The President said that merely injecting more finances by the Government alone and that too when the country’s economy was under severe stress was no permanent solution. He said that Pakistan Railways needs to re-orient itself to introduce corporate culture in its organisation while simultaneously undertaking comprehensive administrative, financial and human resource reforms.
President said that besides internal weaknesses of the organisation, the past neglect of the successive governments in providing sufficient resources to Pakistan Railways as compared to other modes of transportation particularly the road sector was also among one of the major causes for the present plight of PR. The President said that at a time when the government was working assiduously for enhancing regional connectivity, Pakistan Railways necessarily has a major role in materialising the concept of inter and intra regional connectivity projects. The President said that regional linkages of Pakistan Railways to China through Khunjarab, to Afghanistan through Peshawar and Chaman and to Iran through Taftan were of immense importance to enhance connectivity. Haji Ghulam Ahmed Bilour, Federal Minister for Railways, Secretary Railways Mr. Javed Iqbal and General Manager PR Mr. Saeed Akhtar briefed the meeting about various causes that contributed towards deterioration of the organisation and various options to resuscitate it.
Govt apathy?
It was informed that that due to lack of investment consistently in the past, PR has been unable to render its capacity service. Being a public service organisation, various factors such as rising salaries, pensions and fuel prices constrained organisation’s allocations for repair and maintenance, it was told.
The Railways Minister said that in 50s and 60s the five year plans saw PR a preferred mode of transportation with allocation of more than 60 per cent of the funds set aside for transport sector but later on it dwindled continually sliding down to 20 per cent in 1998-2005. Haji Ghulam Ahmed Bilour said half of the total locomotives were out of order, 86 per cent of the bridges were more than 100 years old, signaling system was obsolete, telecommunication system outdated and the track over-aged. He said that efforts were underway to attract private investment to shore up Railway’s declining resources.
Railways Minister said that a crisis management programme has been put in place whereby task force has been constituted to explore possibility of repairing locomotives in collaboration with private sector as well as hiring/leasing them from other countries.
Need for transport policy?
The Railways Minister also put forward various recommendation including chalking out a National Transport Policy to fix the role of railway versus roads to rationalise the allocation of funds, various emergency measures to address issues such as pensions, foreign loans and State Bank overdraft. He also proposed Government subsidy in the current financial year since the allocations for PR were short of the demand by the organisation. The meeting was informed that the pre-feasibility report for the proposed Gul Train has been received. Farhatullah Babar said that the pre-feasibility report endorsed the concept of private sector participation in the operation and maintenance of cargo and passenger train services. The private sector representatives present during the meeting said that private sector could invest in the rolling stock and can assist in raising funds and bringing in investment in the railway sector.
If every problem of the nation is to be looked into by the President Asif Ali Zardari, then what for is the Chief Excecutive & the PM being paid by the country. Constitutionally, after the recent amendents passed by the parliament all powers vests under the PM. However, every minor and major issue is being looked after by the President. Under the circumstances, either the PM should work without remunerations or the CJ SC should order confiscation of his pay and allowances for dereliction of his duties. In any case this joke with the poor nation must end forthwith.
Well said. I would add if the temperament of our nation, journalists, civil and military establishment is to follow the dictat's of a President (not the President; Pakistanis have historically followed what the Presidents have said) then we should elect our Presidents directly rather than indirectly where the national legislature (assembly) and the provincial legislature (assemblies) become the electoral college and vote for the President. It is like the basic democracy (BD) system of late President Ayub Khan.
The present system is open to manipulation as it is believed to have happened on this occasion. This lead to a very unpopular man who claimed he had dementia to avoid appearing in international courts become the President and in his place the man from Khyber Pakhtoon-Khwa accepted other uncalled for privileges perhaps both in kind and cash. The KP man paved the way for Asif Ali Zardari to become the president.
Government is not serious in getting the railway out this problem otherwise Railway should be profitable entity .If government mange railways well it can be profitable shortly as you see a small company like Daewoo bus service is profitable and expanding rapidly how can Railway goes in losses.
This is response to the comments of a fellow reader of this article.
I would add if the temperament of our nation, journalists, civil and military establishment is to follow the dictat's of a President (not the President; Pakistanis have historically followed what the Presidents have said) then we should elect our Presidents directly rather than indirectly where the national legislature (assembly) and the provincial legislature (assemblies) become the electoral college and vote for the President. It is like the basic democracy (BD) system of late President Ayub Khan.
The present system is open to manipulation as it is believed to have happened on this occasion. This lead to a very unpopular man who claimed he had dementia to avoid appearing in international courts become the President and in his place the man from Khyber Pakhtoon-Khwa accepted other uncalled for privileges perhaps both in kind and cash. The KP man paved the way for Asif Ali Zardari to become the president.
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