Finance ministry agrees to release Rs 11.5 billion for railways uplift
Islamabad: The Ministry of Finance Friday agreed to release Rs 11.5 billion by next month under bailout package approved by the federal cabinet in December last year.
The matter came under discussion in a meeting between the Minister for Railways Haji Ghulam Ahmed Bilour and Minister for Finance Abdul Hafeez Shaikh and Secretary Finance Waqar Masood Khan.
In the meeting, railways minister pleaded his case for undue delay in release of Rs 11.5 billion allocated by federal cabinet for maintenance and rehabilitation of railways.
However the minister convinced the finance minister who agreed to release the funds by next month.
Abdul Hafeez Shaikh asked the railways minister to move a PC-1 of the projects the ministry is planning to execute from allocated funds, to the finance ministry for approval.
In the meeting, the railways minister said if funds are released timely, the year 2011 would be commemorated as year of railway’s up-gradation as ministry would execute various development projects under the package.
Bilour said had the finance ministry released funds timely, the railways would have repaired around 80 locomotives.
The railways minister was of the view that in case of timely release of funds, the ministry has the capacity to repair around 12 locomotives in a month time.
Briefing the finance minister, Bilour said Railways would spend Rs 6.1 billion on maintenance of 145 locomotives, Rs 2 billion each on rehabilitation of tracks and coaches and Rs one billion would be reserved for future use.
He said after maintenance, 75 percent of locomotives would be used for freight carrying and rest 25 percent for passenger coaches.
According to the estimates, a locomotive of 3000 horse power generates up to Rs 60 million per annum against Rs 50.5 million by the one with 2000 horse power.
He said for maintenance purpose, the spare parts would be imported from United States and China and 12 to 15 locomotives would be repaired each month to minimize losses of this public entity going into losses worth Rs 3 billion a month.
Bilour told the meeting that all over the world, freight coach service bears the expenditures and brings in profit and the passenger coaches usually suffer losses.
He said undue backing to National Logistics Cell at cost of Pakistan Railways deteriorated the situation, referring to the laws across the world where a cargo truck is disallowed to move from one district to the other but in case of Pakistan, a single truck roams around the whole country.
The railways minister said the federal cabinet also empowered the ministry to increase fares in proportion to surge of oil prices in international market without prior approval of the federal cabinet.
Bilour said he has never been in support of closing down trains but sometimes, it is inevitable when the revenue decreases to 20 percent of the expenditures.
The minister also thanked the prime minister, the federal cabinet and the finance ministry for realizing the plight of Pakistan Railway suffering huge losses owing to scarcity of funds.
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