Rail Tariff Authority

Currently, setting of tariffs for railways is the function of the Railway Board. Revising rail fares is a politically sensitive issue. Every year, the Rail budget is passed without any substantial rise in the Rail tickets. The railway’s passenger subsidy is a whopping Rs. 25000 crore per year.

To free the rail tariffs from political influences, Rail Tariff Authority was proposed during UPA rule and Manmohan Singh cabinet had approved setting up of such an authority to advise the Railway ministry on fare revision and freight revision.

Functions of the Rail Tariff Authority

• The Railways would ‘accept the recommendations ordinarily’ but if it disagrees with the advise, it would send the recommendations back to the authority which will review its decision.
• The proposed RTA is to engage with all the stakeholders, including Railways, consumer groups, container operators etc before it advises the government on determination of fares and freight rates.
• Other than rationalizing the fare structures, the RTA has would also have the responsibility of increasing the quantum of freight sent in Railways and also reduce cross subsidization.

Current Status

Rail Tariff Authority would be a statutory body and currently, the NDA government is in process of framing a draft bill. The Railway Ministry has announced that Rail Tariff Authority will be in place by FY 2019.