Covid-19 Effect: Railways To Cut Expenditure By 25 Per Cent; Prioritise Works 

With earnings shrinking fast in rail sector due to the deepening economic turmoil caused by the COVID-19 pandemic, Indian Railways has decided to reduce the overall expenditure considerably to manage the unprecedented situation.

A review of all high-value purchase orders, cut in energy bills, travel allowance, overtime booking hours, procurement of material stock and office stationeries among others are being listed for possible expenditure reduction in the time of the pandemic which has adversely impacted business and industry including the rail sector.

According to the directive, focus would now be on completing important last-mile works and safety related projects.

In view of the huge throw-forward liability, fresh contracts are to be entered into for essential and inescapable works only, according to the latest guidelines.

In a letter to all General Managers of railway zones and production units, Railway Board has asked for prioritising works while reducing expenditure by upto 25 per cent.

In view of the impact on Indian Railways’ resources due to COVID-19 pandemic, Railway Board has now approved a cut in spending, the Board letter stated.

Seeking strict compliance of the order, it has directed expenditure reduction on budget outlays in all plan-heads.

Six weeks into the new fiscal, revenue earnings have dipped in the freight segment due to the low demand in core sectors, while regular passenger operations have been suspended due to the lockdown.

Acknowledging the expenditure cut directive, the General Manager of a high-density zone said steps were under way to cut expenditure by 25 per cent and accordingly instructions have been issued to all concerned.

Since earnings have reduced due to prolonged lockdown, there is an urgent need to control and reduce the overall expenditure to the extent possible, the zonal railway GM has said in a letter to all his Divisional Railway Managers and department heads.

Though freight operations have not been stopped, loadings are on the downslide due to the economic downturn.

Amid the suspension of passenger services, Railways is continuing with Shramik Specials and AC Specials to ferry stranded passengers.

In a mission mode, Railways is ready now to run 300 “Shramik Special” trains daily to transport more than 4 lakh stranded persons across the country.