CAG says Railways Ministry resorted to window-dressing, sanctioned financially unviable projects
'Review of identification and sanction of projects for EBR (extra budgetary resources) funding revealed that financially unviable projects were sanctioned,' the report said
The audit also noted that there was heavy dependence on transportation of coal which constituted around 47 percent of the total freight earnings
New Delhi: The "Ministry of Railways resorted to window dressing for presenting the working expenses and operating ratio in a better light," said the Comptroller and Auditor General (CAG) of India in an audit report on the railways' finances in FY19. While the net surplus in FY2018-19 was Rs 3,773.86 crore, the Railways would have ended with a negative balance of Rs 7,334.85 crore had it not been for the receipt of advance freight and less appropriation to Disaster Relief Fund and Pension Fund, said the CAG.
The report which was tabled in the Parliament on Wednesday said that the Railways could not achieve even revised earnings target of Rs 1,97,214 crore. The term window dressing refers to an adroit but superficial or misleading presentation of something, designed to create a favourable impression.
In FY19, Railways generated Rs. 1,90,507 cr, missed earning target
The audit report said that the Railways generated total internal earnings of Rs. 1,90,507 crore in FY2018-19 against the targeted internal earnings of Rs. 2,01,090 crore. Against the target of 92.8 percent in the Budget Estimates, the operating ratio of railways was 97.29 percent in 2018-19. Operating ratio indicates the amount of money the Railways spends to earn each rupee.
However, if advance freight of Rs 8,351 crore from NTPC and CONCOR was not included in the earnings of 2018-19, OR would have been 101.77 percent instead of 97.29 percent, the CAG said.
Railways sanctioned financially unviable projects: CAG
"Review of identification and sanction of projects for EBR (extra budgetary resources) funding revealed that financially unviable projects were sanctioned," the report said. An amount of Rs 15,922 crore was incurred from EBR towards 79 unremunerative projects. The criteria for exclusion of projects pending land acquisition was not followed, the CAG said and added that 111 such projects were funded from EBR.
While none of these were completed as on March 31, 2019, there were instances of irregular utilisation to the tune of Rs 1,495 crore from EBR funds, it said.
The audit also noted that there was heavy dependence on transportation of coal which constituted around 47 percent of the total freight earnings of Rs 51,067 crore during 2018-19. "Any shift in bulk commodities transport pattern could affect the freight earnings significantly," it said.
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