What’s in Today’s Article?

• Introduction (About Bibek Debroy Committee)
• Key Recommendations of the Committee
• Implementation Status

Introduction:

• The Bibek Debroy Committee, formed in 2014, aimed at suggesting comprehensive reforms for the Indian Railways to improve operational efficiency, financial viability, and competitiveness.
• Chaired by renowned economist Bibek Debroy, the committee published its landmark report in 2015, proposing extensive changes to transform Indian Railways.
• The report highlighted issues across decision-making structures, financial management, human resources, and the need for liberalization within Indian Railways.

Key Recommendations of the Bibek Debroy Committee:

• Empowerment of Railway Officers:
  • The committee emphasized empowering field officers, including General Managers (GMs) and Divisional Railway Managers (DRMs), by granting them greater decision-making authority.
  • The government has partially implemented this by empowering GMs and DRMs to make independent decisions, handle various tenders, and manage divisions as business units.
• Establishment of an Independent Regulator:
  • A major recommendation was to set up an independent regulatory body to ensure fair competition and regulate pricing.
  • The Rail Development Authority (RDA) was approved in 2017, intended to provide expert advice on service pricing, enhance non-fare revenue, and foster competition.
• Liberalization of Indian Railways:
  • The committee recommended "liberalization," allowing private operators to participate in rail services to increase competitiveness and improve services.
  • It clarified that liberalization does not imply "privatization" but aims at creating a competitive environment.
  • However, due to opposition from railway unions and political parties, the government has not fully implemented this recommendation.
  • Private participation is limited to select Public-Private Partnership (PPP) projects, primarily in freight services.
• Redesignation of Railway Board Chairman as CEO:

• To expedite decision-making, the committee recommended designating the Chairman of the Railway Board as Chief Executive Officer (CEO) with final decision-making authority.
• This was implemented in 2020, with the first Chairman and CEO of the Railway Board appointed, making the Board function more like a corporate entity.

• Offloading Non-Core Services:

• The committee suggested that Indian Railways focus on its core function of running trains, while outsourcing non-core services such as security (Railway Protection Force), medical, and educational facilities for employees.
• The government is considering this recommendation to reduce operational burdens and improve focus on core railway services.

• Reforms in Accounting System:

• A major overhaul of the accounting system was recommended to shift from cash-based accounting to accrual-based accounting, enhancing financial transparency.
• This recommendation was implemented through an Accounting Reforms project, with Indian Railways now preparing financial statements on both accrual and cash bases.

• Safety Measures and Rashtriya Rail Sanraksha Kosh (RRSK):

• In response to the committee's recommendations on safety, the Ministry of Railways created the Rashtriya Rail Sanraksha Kosh (RRSK) in 2017 with a fund of ₹1 lakh crore for replacing, renewing, and upgrading critical safety assets.
• In 2022-23, the government extended RRSK with an additional ₹45,000 crore in budgetary support.

• Integration of Advanced Technology:

• The committee recommended integrating advanced technology to modernize railway operations, including the adoption of high-speed trains like Vande Bharat and safety systems like KAVACH.
• The establishment of Gati Shakti Vishwavidyalaya for skill development and capacity building in rail technology aligns with this goal, focusing on empowering the workforce with modern skills.

Implementation Status:

• Out of the 40 recommendations made by the committee:
  • 19 were fully accepted, including the redesignation of the Railway Board Chairman as CEO, accounting reforms, and setting up RRSK.
  • 7 were partially accepted, such as empowering DRMs and implementing decentralization at the division level.
  • 14 recommendations were rejected, mainly due to opposition from unions or political considerations, especially regarding liberalization and private sector entry in passenger services.

Conclusion:

• The Bibek Debroy Committee's recommendations laid the foundation for a modern, efficient, and financially sustainable Indian Railways.
• While several recommendations have been implemented, including structural changes, safety funds, and decentralization, others remain pending due to various challenges.
• The reforms introduced have made significant progress, yet the journey to fully modernize Indian Railways continues.