Railways nudge to sensitise people towards subsidy on train tickets

Interesting bit from Indian railways. It will now be printing the subsidy on the railway tickets:

While Indian Railways is grappling to improve its finances, it has found an innovative way to send the message to passengers on how Rs 34,000 crore subsidy offered annually in passenger fare is putting a heavy burden on its balance sheet.

Now tickets booked at reservation counter, including seasonal tickets, and those booked online will come with a printed message that railway get only 57 percent of fare paid by the passenger. According to railway ministry, railways earn only 57 paisa of every rupee passenger spends on fare and 43 paise is subsidy offered.    

Railway has started printing one line below the ticket saying ‘Indian Railways recovers only 57 percent of cost of travel on an average’. The exercise has started from last one week and the idea is to tell passengers that fare are heavily subsidized. The government run transporter loses around Rs 34,000 crore annually on passenger segments and it is cross-subsidised by freight earnings.

“We have started printing the earnings we make from passenger fare on tickets so that people know that the fares are cheapest and highly subsided. We recover 57 percent in passenger service and 37 percent in suburban services and this will reflect on tickets,” said Member Traffic, Railway Board Mohammed Jamshed.

Describing it as an awareness step, Jamshed said this will make passengers aware of the real cost involved in the travel and how much Railways is bearing the burden. “Awareness is a must as it will lead to the rationalisation of fares which is required for the survival of the Railways,” he said.

Perhaps a sequence of nudges before tickets are going to be priced fully without any subsidies..

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