New Face for Sri Lanka Railways
I think the Minister of Transport Dallas Allahapperuma is truly enthusiastic to improve the Sri Lanka Railways (SLR). Opening of alternative railway bridges over Kalu Ganga at Kalutara, completion of a third line bridge over Kelani Ganga at Kelaniya, the building a railway extension bridge over Nilwala Ganga at Matara and the currently concluding duplicate track to Aluthgama, preparations for a third line between Orugodawatta and Kelaniya, construction of an extension line to Kataragama, promise the dawning of a great era for SLR under the auspices of the Mahinda Chinthana.
One hundred new passenger coaches from China are already on the tracks. Sixteen new power sets from the same source are on the way. Increasing train speed through strengthened tracks, with elimination of crossings, will shorten running times. We can drape multi- coloured flags along the tracks, beat drums, eat traditional sweat meats with milk rice and enjoy this inauguration of a railway rejuvenation. Congratulations!
All this is achieved through capital expenditure. Recovery of that extends over about 20 years. So there is no immediate burden on the national coffers. But day –to- day running of trains entails unavoidable expenditure. We call it “current expenditure”. For 2007, SLR current expenditure was Rs. 7297 million. The total revenue for the same period was Rs 2999 million. That means the Railway operating loss was Rs. 4297 million, (The Annual Report of the Central Bank of Sri Lanka 2007). That means a 59% loss. In other words, whenever a passenger buys a ticket for Rs. 41/= he gets a state dole of Rs 59/=. For how long will our SLR run?
It may be argued that when speed is increased and wayside detaining for crossing are avoided by alternative lines, arrival time at the destination will be greatly advanced. That will definitely attract new passenger demand resulting in elimination of loss hitherto experienced and SLR will be a profitable venture in a short time. This promise is not as rosy as it sounds because a system of express highways with suitable approach connections is looming simultaneously. If you can enter an alternative vehicle at your door-step to be conveyed at high speed to your far- away office more quickly, why should you bother about trains? Do not forget that the transport market is highly competitive.
An individual’s paying capacity is limited by his earning capability. Likewise, for the government to spend money, government must earn. The government cannot print money. If they do that the result would be hyperinflation, as presently experienced in Zimbabwe. If earning skills of the country are disabled and made dependent on the Treasury, the crumbling of the economy and national bankruptcy are unavoidable. What will be the future of Sri Lanka with the gathering collapse of the world economy? From where could we get a loan? If we get new ones how to pay back?
Human culture advances by means of discovery and copying. Is there a railway which we can copy?
Let us examine Japanese railway. The first sod for railways in Japan was cut in 1872. Till 1987 that railway was run by the government. Serious mismanagement, inefficiencies and fraud caused profit losses. I seriously think the problem of SLR is the same. The Japanese government was forced to sell the railways into private hands, known as the Japanese Railway Group (JR).
With privatization, Japanese railways thrived unbelievably. But the lowest unit charge of passenger transport in that railway system is 16 yens a kilometre. The current exchange rate of a Yen is Rs. 1.10. The distance from Kalutara South to Colombo is 43 km. Accordingly, a poor commuter would have to pay Rs 756.80 for his ticket! So, the Japanese alternative is too much for a dole- supported passenger of Sri Lanka.
So let us turn to our closest neighbour, India. It is true that India is a very big country compared to us. But the whole Indian Railway (IR) is under the government. So we have an affinity with them there. In Sri Lanka, the whole railway track, except that north of Palavi, belongs to the government.
The saviour of IR is the present Cabinet rank Railway Minister Sri Lalu Prasad Yadev.
Four years ago, IR was in a deep financial mire in which they could not pay anything to their government. The great prosperity achieved by IR within the last four years is an unbelievable miracle.
To increase passenger fare in poverty- stricken India is political suicide. So IR reduced the passenger fares. The result was an immense increase of demand for passenger conveyance on rail. To cope with this enhanced rush of passenger demand IR did not increase the number of trains but lengthened existing trains. Consequential increase of income for consecutive four years from sale of tickets is Indian Rupees 2000 crore (A crore [cr] is ten million). But this did not recompense current expenditure.
Then to alleviate the loss thus made, IR increased the capacity of freight transport. The freight charges were also regulated to suit the existing competitive transport market. The quantity of goods transported by IR during June in 2008 was 65.26 million metric tons (MT). In 2003-04, the Railways loaded 557 MT whereas freight loading this year is likely to be 790 MT. In this manner, in the last four years incremental freight loading is likely to be 233 MT, which is 160% of the incremental loading registered in the entire ‘90s decade. In addition to this the total container traffic is expected to be 26 MT in 2007-08. Indian Railways receives about 25% of the total traffic from various ports.
Reduction of current unitary expenses enabled the reductions of charge per unit. This expanded demand for railway services. In the last four years, they have turned in a cumulative cash surplus before dividend of IRs. 68,778 cr. Out of this IRs. 15,898 cr has been paid as dividend to the Government Treasury, IRs. 39,215 cr has been invested in rail infrastructure and IRs. 13,665 cr has been added to fund balances to reach IRs 20,483 cr. In 2007-‘08, they expect to create history by making railway operating cash surplus before dividend to be IRs. 25000 cr. As a result, popularity of the governing political party too grew.
Who advised the Indian Minister of Railways to achieve this wonder? Sri Lalu Prasad Yadev’s own words are as follows: “An excellent synergy between investment, commercial, tariff and operating policies helped us achieve spectacular financial results.” Note well the emphatic absence of engineering consultations!
It is meaningless to dream about Japan for we will never achieve that in the next 400 years. So the best is to follow the Indian example. In that light let us confess our own weaknesses. Then we can cure them.
The supreme advisers of SLR are parochial railway engineers. Commercial section is headed by a man who knows next to nothing about commerce. Business administration expertise is never heard of in SLR. If an operating expert opposes an engineering suggestion somehow or other he is pushed into oblivion. The best example is when proposals for importing operationally unsuitable 65 feet air-brake controlled coaches from China were underway last year; the SLR Additional General Manager (Operating) formally reasoned out their unsuitability and objected to the trade proposal. What happened? Instead of considering alternative sources the stumbling objector was removed from SLR by filing an untenable case. He was exculpated and discharged of all blame. By that time his retirement date had come. Now he is at home. SLR operating consultation is in a vacuum where round holes are plugged with square pegs to suit the engineering domination. Now engineers are free to do what they want. So they are importing further, 65 feet power sets disregarding the immediate demand of 48 feet coaches for the Upper Division. Now they increase the shortage of locomotives by keeping seven brand new locomotives stationary.
Salvation for SLR is not in showy improvements of passenger transport, but in enhanced freight transport, especially containers. Recently a person holding the post of Railway Operating Superintendent (0 Ps) was investigating the possibility of container transport by rail by surveying the Old Naval Yard at Veyangoda as a stacking yard for containers. For some mysterious reason he was spirited away.
A few days ago I had the opportunity to attend a lecture on “Significance of Railway Transportation in Supply Chain Management” at the Institute of Engineers of Sri Lanka. The lecture was conducted by erudite Dr. P. Ramachandran, B Sc. (Engineering), M.Sc. Ph.D, Dic, C Eng. MIE (SL), a Senior Lecturer of the Department of Management Technology of the University of Moratuwa. At the inception he complained, “Now we use the most expensive road transport with huge containers and large lorries entering and leaving the port. They spend a long time crawling in thick traffic and waiting many hours for security clearance.” At another stage of his lecture he said, “Rail transport has great potential to play in warehousing and transport roles. This was done very efficiently by CGR. What is needed is to adapt to the needs of today’s business”. Further he insisted on providing the most economic means of moving goods within the distribution system and providing a delivery service that meets their defined time and quality conditions. At the end of the lecture I approached the lecturer and questioned him as to why we cannot practically experience such adorable theories in Sri Lanka today? His answer was only a smile of deep meaning.
The following is taken from the Annual Report 2006 of the Central Bank of Sri Lanka: – “Sri Lanka Railways are operating at large operating losses and producing services that are of high cost and insufficient quality, burdening the government budget and reducing the competitiveness of the country. Implementation of identified institutional changes, improving financial and operating management, eliminating waste, introducing innovative products and other relevant measures would improve the financial position of this institution” (Page 43).
At this juncture I am sorry to record that big freight transport wagons (BCGS) imported from Pakistan cannot move because their springs were broken at the inception. Fifty container flats were imported from Egypt. When two 20 feet containers are loaded on to one, center of one bends down towards the rails. The resultant rubbing of container tops on the normal run, causes them to get welded. So the flats are left to decay in sun, rain and salty sea breeze. Now Colombo habour line is never used except to bring imported coaches. In my time we ran two harbour goods trains daily.
Alsthom is a French company manufacturing railway locomotives. It has already manufactured over 20,000 railway locomotives for various countries. Recently Iran ordered 100 diesel electric locomotives from Alsthom. Thai Railways have used these locomotives successfully for a long time. The French Railways ordered 15 new locomotives from Alsthom on Oct.13, 2008. SLR got down 10 Alsthom Ruston locomotives from the same company in 2000. But seven of them are out of commission for years now. With all that history of efficiency behind the Alsthom Company, what is the reason behind the failure of SLR engineers to get consultation from them to restore the failed locomotives when there is a dire dearth of them? About 30 new air-brake controlled coaches are idling, goods trains are terminated halfway due to want of locomotives!
Recently, the Supreme Court of Sri Lanka delivered a few history- making judgements. Now will the citizens of Sri Lanka be successful in litigation before the same court alleging that their fundamental rights are infringed by Railway engineers, by making us beggars, by misusing finances by importing low quality capital goods and criminally neglecting to maintain properly income- earning assets of Railways? I beg legal advice. I draw the reader’s attention to Article 28 of the constitution of the Democratic Socialist Republic of Sri Lanka.
I lament bitterly because poor Sri Lankans who hardly earn enough to get one meal a day sacrificed so much to give supreme education free of charge to engineers who now aspire to build their future haven in rich countries by nibbling our economy as their predecessor have already exemplified.
(Re Indian Railways I am highly indebted to the Speech of Shri Lalu Prasad Yadev, Minister of Indian Railways, introducing the Railway Budget 2008-2009 in the Lok Sabha on February 26, 2008)
by H D I Anthony
Special class Rail Head Guard (Retired)
Thanks to: Kapila
Source: The Island,
