PR's travails

The latest reports from the Pakistan Railways do not give rise to much optimism about its future. At one time the backbone of the transportation system in the country and a prime revenue earner, PR has been on the slide for the past several decades.

Not only has its budget been in the red, the quality of its services has also been declining. As a result, over the years the trend has set in for the railways to lose passengers and freight.

Two years ago under the direction of the president, a special effort was made to spruce up the railways, and its prospects began to brighten up somewhat. But obviously the effort has not been sustained and a week ago the railway authorities brought it to the prime minister's notice that adequate funds were not being provided to this sector. Its share in the PSDP has fallen to 7.2 per cent this year from 8.5 per cent in 2001-2002.

It appears that the government has written off the railways as a key constituent of the country's transportation system. Earlier this was done to give a boost to air and road transportation - the National Logistics Cell receiving special favours under General Ziaul Haq's regime.

With the railways starved of funds and attention, not surprisingly precious little expansion and upgrading have taken place. The rolling stock is mostly obsolete and worn out and has not been replaced as it should have been.

The tracks have not been substantially expanded and not many new services have been added. As a result, the utility and attractiveness of the railways as a mode of travel has declined and the passenger and freight traffic has gone down.

This has naturally affected its profitability and served as a disincentive for government investment. No government has attempted to break the vicious cycle and put the railways back on track.

Given the lack of vision in government planners and policymakers and their failure to comprehend the indispensable role of the railways in the national life of the country, the only solution to the problem they have been able to suggest is privatization of some sectors and services.

There has also been talk of selling off some shares in the open market. But will this really prove to be a shot in the arm for the railways? If the problem is simply seen to be one of balancing the railway budget and prevent it from going into the red, privatization may be seen as an answer.

But the real challenge is to develop the railways as a utility which can provide an efficient and cost-effective facility for passenger and freight transportation.

It is plain that privatization will only make rail travel more expensive for the common citizen while improving services in the sectors that are in demand. Any private entrepreneur will seek to recover his investment as well as make a healthy profit.

This will defeat the basic goal of providing a cheap and convenient mode of inter-city transport. It is important that the government acknowledges the role of the railways and accepts its responsibility of providing financial, managerial, administrative and infrastructural support to it.

Initially this would call for greater investment, but as services improve and are expanded, revenues will start flowing in.

Poultry package

The poultry industry has asked the government for a special revival package under which soft loans and other incentives can be given to help farmers get back on their feet.

The industry wants the government to compensate it in some way for the losses it suffered in January's bird flu scare. Poultry farmers claimed the industry as a whole suffered losses in excess of Rs 5 billion.

The detection of the bird flu strain in poultry farms around Karachi resulted in the death of about 3.5 million birds, either from the flu itself or the culling that owners undertook to stem the spread of the avian virus.

As a result of the scare, demand for chicken meat dropped as did the price of eggs. Exports of chicken products were also banned, which added to the farmers' woes. The bird flu episode did more than cause losses to poultry farmers.

It made people keep away from a reliable and cheap source of meat and nutrition. The drop in chicken consumption led to a surge in demand for other meats, which saw some prices rising dramatically. This imbalance in meat prices needs to be corrected.

Based on this argument, the poultry farmers have a strong case for government help to revive the industry since in the long run this will once again stabilize overall meat prices in the market.

However, any relief package should come with some conditions attached. The bird flu crisis was yet another reminder to poultry farmers and meat processors to adopt more hygienic practices in preparing and selling chicken meat in the market.

The place where chickens are slaughtered and cleaned are usually infested with flies and other sources of contamination. The current state of affairs is reason enough for the government to ensure proper arrangements for meat processing and transportation. This would go a long way in avoiding at least the commoner and more preventable infections.

Universal ATMs

The report that bank account-holders will now be able to use the automated teller machines (ATMs) of any other bank should be welcomed by all those who have ATM cards.

The State Bank of Pakistan is said to have pushed this idea, because it will make life easier for those who have ATM cards but have had to suffer the inconvenience of going to the ATM machine of their particular bank.

That inconvenience will now be reduced since customers will be able to access any ATM machine - hopefully, the participating banks will not levy an unreasonably high charge for this service.

The whole idea behind ATMs is to make the account holder conduct routine transactions without going through a teller. For the bank this means reduction in its operating cost and for the account holders who still wish to go to the bank less waiting time.

In the context of improving banking services for non-corporate small-scale customers there is a lot more that can be done. Banks of late have developed the tendency to increase service charges or introduce new charges for existing customers.

Almost all the banks, especially those in the private sector, have raised the minimum limit on the balance for maintaining a current account. Failure to maintain the minimum balance invites a penalty and such a policy is clearly biased against customers from modest financial backgrounds.

The banks will say that they are in the business not for charity but for making a profit. While no one is disputing their right to make money, they should not do so by exploiting individual customers.

All over the world, banks make money on loans and not necessarily by squeezing the average account holder or by introducing new and novel conditions to discourage accounts which in the bank's estimation are not worth servicing.

The SBP should ensure that the right of the banks to charge a reasonable amount for services is balanced by the rights of the banking public to get an efficient and less costly service.