The Financial Express
Swasti Lankabangla Swasti Lankabangla

BR mulls over fare hike on ADB pressure

Railway revised ticket prices three years ago

| Updated: October 24, 2019 12:39:17

Picture used only for representational purpose — Collected Picture used only for representational purpose — Collected

Bangladesh Railway (BR) is planning to raise fares for both passenger and freight trains to meet a requirement of the Asian Development Bank (ADB) as part of the railway reform programme.

The last time the BR revised its fares was three years ago, although the reform programme called for revision of the fares every year under a tariff policy set out by the ADB.

The regional multilateral lender has long been pressing the state-owned train operator to implement the tariff policy even as the tenure of the reform project ended in June last.

Sources said an ADB mission that visited Dhaka last month again put pressure on the BR to comply with the tariff policy.

The mission also hinted that the BR would face difficulties in getting funds for upcoming projects unless there is progress in tariff adjustment and other reforms, they said.

The tariff adjustment is designed to reduce the huge gap between train operating revenues and expenses in order to ensure financial sustainability, according to the ADB.

In 2018, the total operating revenue of BR was Tk 14,861 million while the total operating expenses was Tk 29,180 million, the BR data show.

Official sources said the Bangladesh Railway has already submitted a proposal for tariff adjustment for only passenger trains to the Ministry of Railways, recommending a hike of 20 to 45 per cent.

But it did not mention anything about the container transport tariff, they added.

A meeting on the proposal was held in August last but no final decision was made.

"Raising ticket fares is not so easy in our country. It would have a massive impact on poor passengers as they are heavily dependent on trains for travel," said an official involved with a committee to review the tariff.

There is also political pressure not to increase train fares, he said, adding that the committee will sit again to fix a rate of increase by assessing the trend of fare rise in bus, maritime and air passenger services.

As part of the reform programme, the BR once revised the fares in February 2016. Later, it also changed the fare structure of two Bangladesh-India train services considering that it would have less impact on its passengers.

But it refrained from adjusting the overall tariff annually, anticipating negative impacts on the commuters who come from mostly lower-income groups.

BR officials said the committee comprising 11 members representing the MoR and BR has proposed increasing fares of economy-class ticket 10 to 20 per cent and AC first-class ticket 30 to 50 per cent so that majority of passengers are not affected by the fare hike.

Presently, eight railway projects are in the lending pipeline of the ADB.

The projects include Tongi-Akhaura dual gauge line, Dhaka-Chattogram-Cox's Bazar railway corridor maintenance facility project, procurement of metre-gauge passenger carriage, construction of workshops at Daripara and Rajbari, and chord line between Dhaka and Narayanganj.



Share if you like