Officials say a merger would affect quick decision-making on starting or winding up routes, fixing ticket prices and providing emergency services during natural disasters. They also raised concerns over the handling of passengers’ personal data
A month after the Finance Ministry asked Indian Railways to merge the Centre for Railway Information and Systems (CRIS) and RailTel with Indian Railway Catering and Tourism Corporation (IRCTC), the Railway Board has asked the Finance Minister to reconsider the merger, senior officials from the Ministry of Railways told Moneycontrol. ... more...
The officials, requesting anonymity, said that the Railway Board uses data stored with CRIS for business decisions such as starting new trains, winding up trains with low traffic, and setting ticket prices.
Therefore, if the CRIS was not independently controlled by the Railway Board, it would be difficult to make quick decisions, they said.
Risks over emergency services and passenger data
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“Emergency services in cases of natural disasters like floods are also started based on data stored with CRIS,” one of the officials said.
Furthermore, the personal information of passengers, such as registered phone numbers, is also stored with CRIS, and could present a security concern for Indian Railways if it is not secure, they said.
While the government still owns a majority stake in IRCTC, the Railway Board is of the view that merging CRIS with IRCTC will create roadblocks in accessing data in times of need.
What the government wants to do
Last month, the Ministry of Finance had asked Indian Railways to come up with a plan to merge seven public sector companies under Indian Railways into three entities to rationalise its size.
The Finance Ministry, based on the recommendations of former Principal Economic Advisor Sanjeev Sanyal, had asked the Railway Board to come up with a plan to downsize operations within Indian Railways to help organisations focus on their core competencies of running and maintaining railway services.
Sanyal, in a report titled ‘Rationalisation of Government Bodies, Proposal for Ministry of Railways’, highlighted the overlaps of operations between Rail Tel, which provides telecom infrastructure through optic fibre networks along railway tracks; IRCTC, the main internet ticketing arm of Indian Railways; and CRIS, an autonomous society to develop software for passenger ticketing, freight invoicing and passenger train operations.
The report noted that IRCTC’s passenger reservation system is currently operated by CRIS, for which the company and Indian Railways pay CRIS.
What the experts say
Industry experts side with the Railway Board, saying that the merger would not only delay the Board’s ability to make decisions on train operations but also present a conflict of interest as IRCTC is itself looking to operate private trains.
If the merger between CRIS and IRCTC happens, the latter would have information on all train routes, passenger traffic and cargo volumes, which could give it a big advantage over its competitors in operating private trains, said Jagannarayan Padmanabhan, Director, Transport and Logistics at CRISIL.
He added that IRCTC possessing information on all passenger bookings would be comparable to one airline having information on all the routes operated by other airlines and their passenger traffic.
Indian Railways has already started working on the proposals in Sanyal’s report and earlier this week shut Indian Railway Stations Development Corporation after shutting down Indian Railways Organisation for Alternative Fuel in September.
Sanyal, in his report, had also proposed the merger of Rail Vikas Nigam Ltd into IRCON International and the takeover of Braithwaite and Co by Rail India Technical and Economic Services (RITES).
The Railway Board is working on a plan to merge IRCON with Rail Vikas Nigam and Braithwaite and Co with RITES, and is hopeful of completing the mergers in the next six months, officials told Moneycontrol.
Sanyal had also proposed bringing 94 schools run by the Railways under the Kendriya Vidyalaya Sanghatan (KVS), as well as upgrading 125 Railway Hospitals through an institutional mechanism and opening these to the public.
The report also suggested a public-private partnership model for schools and hospitals run by the Railways.
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