Indian railways commercialisation
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Indian Railways is the world's second largest railway system that carries over 18 million passengers daily. Freight revenue makes up 62% of Indian Railways' income. Commercialization of Indian Railways aims to generate more revenue through transportation of both passengers and goods, introduction of information technology, and outsourcing of services like catering and parcel management. Key strategies for commercialization include reviewing value-adding businesses, reducing wagon turnaround times, and developing new products and services.
Indian railways commercialisation
- 1. Submitted By: Avinash Roshan(2010MB70) Jitendra Singh(2010MB33) Kunal Bhasney(2010MB29) Sachin Kumar(2010MB44)
- 2. Indian Railways The world’s second largest railway, carries 18 million passengers each day and it has Introduction to IR
- 3. FREIGHT (GOODS) 62% PASSENGER 28% OTHERS 10% SOURCES OF REVENUE
- 4. 0 10 20 30 40 50 60 70 80 90 100 2002 2003 2004 2005 2006 2007 2008 2009 98.3 96 92.3 92.1 91 83.2 78.7 75.9 Operating Ratio back
- 5. Commercialization of Indian Railways Commercialization is important aspect of Indian railways. Aims at providing not only service but also to generate revenue.
- 9. Retrenchment Strategy Effect 1 ) Reviewing value adding business (Catering, parcel service ) Cost saving > Rs 1,000 crores /annum 2) Reduction of wagon turnaround time 14 % time saved 3) Outsourcing Improved efficiency
- 10. Repositioning Strategy Effect 1 ) Developing new products (Double stack containers) Saving: 7% on capital cost , 25% operational expenses 2) Product differentiation E-ticketing, new passenger coaches 3) Focus on revenue growth(like enhancement in loading capacity, cash incentive to free up wagons) Freight revenue jumped from 233 m(2001) to 417 m(2007).
- 11. Re- Organization Strategy Effect 1) Changes in planning system Improved efficiency 2) Extent of decentralization ( like Zones raised from (2003) to 16 (2005)) Improved vendor satisfaction
- 12. Areas of Commercialization Transportation. Introduction of I.T. Outsourcing.
- 13. Transportation Daily expenditure is about Rs 100 cr (42% staff, 18% fuels). Daily earnings Rs120 cr . Daily loss on uneconomic branch line Rs 8 cr. Greater competition from Roadways, with major investments in Highway network upgradation. Upgradation of the Railway Production units for improved efficiency and productivity.
- 14. Transportation Goods Trains Railway earns mainly from goods traffic. More than a million ton of goods transported daily. Carries 16 lakh tonnes of goods every day. Railways has 7500 engines,38000 coaches & about 2.5 lakh of wagons. Goods train maxm. 100 kmph.
- 15. Transportation Passenger Trains Carries 1.4 crore passengers daily. Greater attention to passenger services and safety. Heavily subsidised passenger fares, distorted passenger pricing. Indian railways have a share of nearly 22% in the passenger transport market.
- 16. Transportation VARIETY OF SERVICES AC FIRST CLASS. AC SLEEPER. FIRST CLASS. AC 3 TIER. AC CHAIR CAR. SLEEPER CLASS. ORDINARY CHAIR CAR.
- 17. Usage of IT in Railways A large complex Infrastructure System with Large Geographical Dispersion such as the Indian Railways can benefit greatly from the intelligent use of IT E-GOVERNANCE OBJECTIVE • Freight revenue enhancement • Passenger revenue enhancement • Improvements in Customer and public service • Investment optimization
- 18. Usage of IT in Railways Transforming Transport through Technology. Jewels in the Crown. • Freight Operations Information system ( FOIS). • Passenger Reservations System (PRS). • Unreserved Ticketing System (UTS). • Instant voice response system (IVRS). • Rail Net. • E- Ticketing.
- 19. OUTSORCING IT giants like TCS and WIPRO eyeing Railways' outsourcing deal. L&T Infotech wins system integration projects from Indian Railways. Indian Railways formed a PPP cell at the Board level to guide in the initiatives of Indian Railways . Organisations like RITES, RVNL, CONCOR, IRCTC, etc. have been formed as an FBO. Parcel Service, Catering,Vinyl Wrapping of trains,Palace on Wheels are part of outsourcing of IR.
- 20. Parcel Management System Following Functions are covered • Parcel Booking, Cancellation and Loading • Monitoring and tracking of Parcels • Printing of Parcel labels • Networking of all parcel offices • RFID tags for tracing parcels
- 21. Vinyl wrapped train by Airtel 80 crores contract with airtel and kurkure for ad
- 22. Catering
- 23. PALACE ON WHEELS
- 24. WHEELS OF CHANGES MoU with CHINESE counterpart Rail fleet with eco-friendly technology Train traffic control will be computerised soon WI-FI will be introduced soon in business class Railway will utilize solar energy
- 26. References www.indianraiways.gov.in www.indianrail.gov.in [email protected] www.rbi.org.in www.reservebank.com www.irfca.org en.wikipedia.org Rakesh Mohan Committee. 2001. Highlights of the Executive Summary Raghuram, G. 2007. ‘Turnaround’ of Indian Railways: A critical appraisal of strategies and processes’, Indian Institute of Management Working Paper no. 2007– 02–03, Indian Institute of Management, Ahmedabad. A Case Study Desh Gupta and Milind Sathye* Faculty of Business & Government University of Canberra, Canberra, Australia.
- 27. References www.indianraiways.gov.in www.indianrail.gov.in [email protected] www.rbi.org.in www.reservebank.com www.irfca.org en.wikipedia.org Rakesh Mohan Committee. 2001. Highlights of the Executive Summary Raghuram, G. 2007. ‘Turnaround’ of Indian Railways: A critical appraisal of strategies and processes’, Indian Institute of Management Working Paper no. 2007– 02–03, Indian Institute of Management, Ahmedabad. A Case Study Desh Gupta and Milind Sathye* Faculty of Business & Government University of Canberra, Canberra, Australia.