By TIOL News Service

NEW DELHI, OCT 05, 2013: SUCCUMBING to the rising cost of fuel the Indian Railways is going to hike the passenger fare from Monday and freight tariff from coming Thursday.

In the Railway Budget for 2013-14, the proposal to implement Fuel Adjustment Component (FAC)-linked tariff revision, bi-annually in sync with movement in fuel costs in either direction was introduced. While the proposal was implemented in the case of freight tariffs w.e.f. 01.04.2013, passenger fares were kept out of the purview of FAC-linked revision at that time, primarily on grounds that these had been revised upwards after a hiatus of ten years only recently, i.e. w.e.f. 22^nd Jan, 2013.

In the present exercise, the escalation recorded in fuel cost during the period February 2013 to July 2013 only has been factored in:

• High Speed Diesel (HSD): + 7.3%
  
• Electricity (Railway Traction): 15.5%

The Ministry of Railways has now decided to revise passenger fare and freight tariffs linking it with Fuel Adjustment Component (FAC). The revised passenger fare will be effective from the midnight of 6TH October and 7^th October 2013 (i.e 0000 hours of 7^th October 2013). The revised freight tariff will be effective from the midnight of 9^th October and 10^th October 2013 (i.e. 0000 hours of 10^th October 2013)

The assessed impact of FAC-linked revision is as under:

1. Passenger Fares:

• No increase in either Second Class Ordinary (Suburban) or Second Class MST fares;
  
• Fares for Second Class Ordinary (Non-Suburban) would go up by a maximum of 5/- in select distance slabs, while in the other distance slabs there would be no change in existing fares.
  
• In all other classes, the revised fares would be only about 2% higher than the existing fare.
  
• Anticipated incremental earning would be around 450/- crore in the balance six months of the financial year.

2. Freight Tariffs:

• An across-the-board increase of about 1.7% in freight rates.
  
• Anticipated incremental earning would be around 700/- crores in the balance six months of this financial year.