Railways Appoints Global Consultancy Firm EY to Mop up Rs. 5,000 Crore ad Revenue
Railways Appoints Global Consultancy Firm EY – We earn less than 5 per cent of our revenues through non-tariff sources. Many of the world railway systems generate 10 per cent to 20 per cent of their revenues from non-tariff sources.
Indian Railways has appointed global consultancy firm Ernst &Young (EY) to help the utility mop up advertising revenues worth over Rs.5,000 crore in the next few years.
“Initiating a large-scale significant exercise to identify and leverage pan-India advertising opportunities at railway stations and trains, Indian Railways has appointed EY as consultant to undertake this job on its behalf,” according to a statement from the Ministry on Tuesday.
In his Budget speech, Railway Minister Suresh Prabhu had said that the utility will look to increase revenues from non-tariff sources and do away with conventional approach of increasing passenger and freight fares. He had not announced any increase in passenger fares and hinted at bringing down freight fares.
“…We earn less than 5 per cent of our revenues through non-tariff sources. Many of the world railway systems generate 10 per cent to 20 per cent of their revenues from non-tariff sources.
“Over a period of the next five years, we will strive to reach this world average by monetising assets and undertaking other revenue yielding activities,” Mr. Prabhu had said.
The public utility had decided to create two new directorates tasked with increasing the speed of trainsand boosting non-fare revenues by monetising land along the tracks and advertising.
Members of the Railway Board recently met to formulate a detailed plan for the two new verticals to be called Raftaar (for increasing the speed of trains) and non-fare box revenue, senior Railway Ministry officials said.
“The Railway Board met recently and decided to create two vertical structures with inter-departmental members – non-fare box revenue and the other one will be named Raftaar to bring speed as an area of focus,” an official said.
Officials said the target of the Indian Railways would be to increase the average speed of freight trains by five kilometres per hour in the first year.
At present, the average speed of freight trains is 25 km per hour, passenger trains 35 km, mail express 50 km and super fast express trains 70-80 km per hour, Railway Board Chairman A. K. Mittal had said last month.
He had also said that the Indian Railways had not been able to increase the average speed in last 10 years as there was no separate department to look into this aspect.
Source: The Hindu