Indian Economy

IS RAILWAY FARE HIKE REQUIRED?

Recently in a statement PM Narendra Modi had told to everyone in related to economy that Agar Admi Bimar Ho To Usko Thik Hone K Liye Dawai Deni Jaruri He. He means that currently Economy is not in a good phase and it required taking tough decision to improve economy. So the first pill he gives is rise in passenger rail fare hike by 14.2% and freight price hike by 6%. Now the question people or Aam Admi is asking does this is required? Currently Indian Railway is running on Rs 30 Cr of loss in a day. To cover that government is paying subsidy of Rs 26000 Cr to Indian railway every year. Thereby increases fiscal deficit.
So Increase in fare price will help Indian Railway to earn about Rs 8000 Cr to Rs 11000 Cr per year. So how these will be benefited
1)      This will help Indian railway to become more modernize
2)      It will help to improve safety
3)      Will help to increase more rail lines
4)      More importantly It will help to reduce the subsidy burden
As lower subsidy means reduction in fiscal deficit. And reduction in fiscal deficit means chances of reduction in interest rates, strong rupee, help in to bring down inflation, and rise in GDP. These will lead to increase jobs.

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