ET BureauThe railway minister tells Bhavna Vij-Aurora he has adopted a nonconfrontational way of restructuring, and that he is confident of raising more funds than required for modernisation of the behemoth.
How do you look back at the last one year?
We have covered a lot of ground. We started at point zero and have travelled a long distance.
In absolute terms, you have to look at the programmes. Take Make in India. You say it will happen after five years and we should not have started today. But, you have to make a beginning somewhere. You talk about working on financial inclusion, we have started it and also completed it.
You look at Swachh Bharat. It may not happen in 10 years. It may take even longer. That’s how it is even in countries like Singapore.
I was talking to Singaporeans the other day and they said cleanliness did not come about in one year. Years of habits cannot be done away with in an instant. If you look at it, this government has done a number of things which can have a shortterm effect, like the financial inclusion and social security schemes. Confidence of the people has to be restored.
People were saying that the sentiments are bad. You could bring back positive sentiments in the country. Sentiments matter a lot in case of creating a business environment. That all has happened this year.
Of late, there is the sense that sentiments are not very strong…
It is an aberration. If you really look at it, people and long-term investor factored in all such issues. For doing business, political environment matters a lot. Domestic investor will know domestic politics better than anyone else. But any other investor, who wants to enter your country, will try to figure out the politics. Even in the US, for example, there was a time when the US goverment was down. Did people leave the US?
It is politics and can happen. It doesn’t effect long-term sentiments. Long-term sentiments are back. People are not investing in short term of India. They are taking a long shot at India because they realise India is coming back on track. You look at the system as a whole. The banking system is positive. The commercial banking system is looking up to this. You look at stock markets, they are also responding in the same way. You look at the business confidence, the PMI, the CMI index - there is considerable all round improvement.
So the sentiments have gathered steam. Fundamentals don’t change overnight. If fundamentals could change they are not fundamentals. We must definitely give huge credit to the government.
There is a view that a lot of criticism coming the government’s way is coming from people who are used to a certain way of corporate business houses and a certain way of having a way with the government, which is not happening anymore. Would you agree with such a thing?
It must be. I am sure. I can give you a personal example. People are very unhappy I don’t handle tenders anymore. They don’t know how to handle this. They don’t see a single broker moving around outside. Brokers have now moved to the stations. It varies from sector to sector. But you know that it is all about coming out with a transparent system of governance. The transparency has certain cost to pay by those who use it and those who provide it. It is a cost. Nobody likes it. People come to me for tenders. I say I don’t deal with them. People come and say, “hamari pahchaan wala hai,” will not be happy with me.
Since you have delegated the tendering powers to the GMs, they must facing the heat now. Are all the brokers going to them now?
Whenever we take a decision, we have to look at the long-term interest of that sector and of the country. In long-term interest for railways, we have delegated everything. I have delegated all my tendering powers and estimate power. To great extent, I have also delegated my administrative powers to the minister of state. I have virtually very little power.
You are looking at the strategy and the big picture?
That is my job. So what is my job? Just to dole out favours? “usko tender de dena.” This is not my job. But if I don’t do this, someone is going to say, “arre aaj-kal kuchch nahi ho raha hai.”
Kuchch nahi ho raha means tender nahin mil raha hai. “Kuchch nahi ho raha hai” people who are telling us is actually, kuchch nahi mil raha hai.
Is the railways today a case of train approaching the station, at the station or has left the station?
It is at all stations. This is like a threedimensional world. So you can say, each of it is true in respect to it. For example, in many areas we have left the station because we are already on the move. We have got a plan ready which is under implementation. One lakh crore will be spent.
Implementation is the key and I will not take it upon myself. I know exactly what we have put in motion.
Each and every budget announcement is under implementation. 36 out of 39 have already been implemented. Each is being monitored through e-samiksha which is an online monitoring system. It is completely transparent. You have to update it yourself and every 15 days you can find out the progress.
Separately, I asked all Board members to prepare their own responsibility chart and earmark projects and the time frame for implementation -- one year, three years, five years. So what I am saying is that the train has already left the station.
Funding is extremely important. Can you create infrastructure without capital expenditure? Can Tatas create a 100 billion dollars group by creating current revenue? We always ask when we will become like China.
We will become like China when we adopt the Chinese way of doing business. The Chinese have invested billions, probably not less than 500-600 billion dollars into railways.
I had a meeting with Arun Jaitley. We have trying to sort out the processes. We are doing everything possible. So the train has left.
Reached the destination? No. Train is in between. That is why we are doing automatic signalling, that is delegation, so that the train does not have to stop at too many stations. So that the automatic signals will work.
Speed breakers are sought to be removed. We have put a lot of speed restrictions on our own. The train is on its onward journey but not reached the destination.
In terms of funding, are you exploring any radical ideas? There has been talk about multi-lateral agencies, sovereign wealth funds.
I have all options open. I have had a meeting with KV Kamath, who is heading the financial advisory board for us. The money available will be in excess of what we need.
Each and every bit of this money is being invested into the sector that will have a huge payback for the railways. The only thing is that we have to make sure that priorities of railways and some social-economic issues and political issues also have to be factored in.
First time, we wanted to be sure, we wanted to give familiarity. So LIC, known instrumentation was approached. So first day when I announced in parliament, CPM was very happy. Then we talked about multi-lateral agencies familiarity. Nobody is going to say what is World Bank and ADB? We are exploring the tax free bonds. There are options which will be given far more beyond this number.
The burden of reviving investment cycle is on railways to a large extent. Will it deliver?
The plan of one lakh crore is the biggest ever plan. The budget implementation has just started. You have to be fair to people. The financial year started from April 1. Till May 6, we have already implemented 36 projects. If you do project approval, then you are inviting CAG to sit here permanently. That’s what you don’t want.
You want a process to be followed. And at the same time, you want to see the money on the ground. There is a process. The working season for railways will start in October. The results will follow.
How do you look back at the last one year?
We have covered a lot of ground. We started at point zero and have travelled a long distance.
In absolute terms, you have to look at the programmes. Take Make in India. You say it will happen after five years and we should not have started today. But, you have to make a beginning somewhere. You talk about working on financial inclusion, we have started it and also completed it.
You look at Swachh Bharat. It may not happen in 10 years. It may take even longer. That’s how it is even in countries like Singapore.
I was talking to Singaporeans the other day and they said cleanliness did not come about in one year. Years of habits cannot be done away with in an instant. If you look at it, this government has done a number of things which can have a shortterm effect, like the financial inclusion and social security schemes. Confidence of the people has to be restored.
People were saying that the sentiments are bad. You could bring back positive sentiments in the country. Sentiments matter a lot in case of creating a business environment. That all has happened this year.
Of late, there is the sense that sentiments are not very strong…
It is an aberration. If you really look at it, people and long-term investor factored in all such issues. For doing business, political environment matters a lot. Domestic investor will know domestic politics better than anyone else. But any other investor, who wants to enter your country, will try to figure out the politics. Even in the US, for example, there was a time when the US goverment was down. Did people leave the US?
It is politics and can happen. It doesn’t effect long-term sentiments. Long-term sentiments are back. People are not investing in short term of India. They are taking a long shot at India because they realise India is coming back on track. You look at the system as a whole. The banking system is positive. The commercial banking system is looking up to this. You look at stock markets, they are also responding in the same way. You look at the business confidence, the PMI, the CMI index - there is considerable all round improvement.
So the sentiments have gathered steam. Fundamentals don’t change overnight. If fundamentals could change they are not fundamentals. We must definitely give huge credit to the government.
There is a view that a lot of criticism coming the government’s way is coming from people who are used to a certain way of corporate business houses and a certain way of having a way with the government, which is not happening anymore. Would you agree with such a thing?
It must be. I am sure. I can give you a personal example. People are very unhappy I don’t handle tenders anymore. They don’t know how to handle this. They don’t see a single broker moving around outside. Brokers have now moved to the stations. It varies from sector to sector. But you know that it is all about coming out with a transparent system of governance. The transparency has certain cost to pay by those who use it and those who provide it. It is a cost. Nobody likes it. People come to me for tenders. I say I don’t deal with them. People come and say, “hamari pahchaan wala hai,” will not be happy with me.
Since you have delegated the tendering powers to the GMs, they must facing the heat now. Are all the brokers going to them now?
Whenever we take a decision, we have to look at the long-term interest of that sector and of the country. In long-term interest for railways, we have delegated everything. I have delegated all my tendering powers and estimate power. To great extent, I have also delegated my administrative powers to the minister of state. I have virtually very little power.
You are looking at the strategy and the big picture?
That is my job. So what is my job? Just to dole out favours? “usko tender de dena.” This is not my job. But if I don’t do this, someone is going to say, “arre aaj-kal kuchch nahi ho raha hai.”
Kuchch nahi ho raha means tender nahin mil raha hai. “Kuchch nahi ho raha hai” people who are telling us is actually, kuchch nahi mil raha hai.
Is the railways today a case of train approaching the station, at the station or has left the station?
It is at all stations. This is like a threedimensional world. So you can say, each of it is true in respect to it. For example, in many areas we have left the station because we are already on the move. We have got a plan ready which is under implementation. One lakh crore will be spent.
Implementation is the key and I will not take it upon myself. I know exactly what we have put in motion.
Each and every budget announcement is under implementation. 36 out of 39 have already been implemented. Each is being monitored through e-samiksha which is an online monitoring system. It is completely transparent. You have to update it yourself and every 15 days you can find out the progress.
Separately, I asked all Board members to prepare their own responsibility chart and earmark projects and the time frame for implementation -- one year, three years, five years. So what I am saying is that the train has already left the station.
Funding is extremely important. Can you create infrastructure without capital expenditure? Can Tatas create a 100 billion dollars group by creating current revenue? We always ask when we will become like China.
We will become like China when we adopt the Chinese way of doing business. The Chinese have invested billions, probably not less than 500-600 billion dollars into railways.
I had a meeting with Arun Jaitley. We have trying to sort out the processes. We are doing everything possible. So the train has left.
Reached the destination? No. Train is in between. That is why we are doing automatic signalling, that is delegation, so that the train does not have to stop at too many stations. So that the automatic signals will work.
Speed breakers are sought to be removed. We have put a lot of speed restrictions on our own. The train is on its onward journey but not reached the destination.
In terms of funding, are you exploring any radical ideas? There has been talk about multi-lateral agencies, sovereign wealth funds.
I have all options open. I have had a meeting with KV Kamath, who is heading the financial advisory board for us. The money available will be in excess of what we need.
Each and every bit of this money is being invested into the sector that will have a huge payback for the railways. The only thing is that we have to make sure that priorities of railways and some social-economic issues and political issues also have to be factored in.
First time, we wanted to be sure, we wanted to give familiarity. So LIC, known instrumentation was approached. So first day when I announced in parliament, CPM was very happy. Then we talked about multi-lateral agencies familiarity. Nobody is going to say what is World Bank and ADB? We are exploring the tax free bonds. There are options which will be given far more beyond this number.
The burden of reviving investment cycle is on railways to a large extent. Will it deliver?
The plan of one lakh crore is the biggest ever plan. The budget implementation has just started. You have to be fair to people. The financial year started from April 1. Till May 6, we have already implemented 36 projects. If you do project approval, then you are inviting CAG to sit here permanently. That’s what you don’t want.
You want a process to be followed. And at the same time, you want to see the money on the ground. There is a process. The working season for railways will start in October. The results will follow.
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