LAHORE: Pakistan Railways (PR) has been asked to increase its freight share through private sector support and shift its focus from passenger trains to commercial side.
“The operation of Yousafwala (Sahiwal)-Karachi-Yousafwala coal trains alone generates 60 per cent of our total freight business which is already being handled by the Pakistan Railways’ Freight Transportation Company (PRFTC). The remaining 40pc would also be transferred soon to the company - a PR’s subsidiary - as the modalities are being finalised these days,” PR Board Chairman/Federal Secretary Dr Habibur Rehman Gilani said while talking to Dawn on Tuesday.
A couple of years back, the Institutional Reform Cell (Cabinet division) made many recommendations through compilation of a report to bring about strategic reforms in the PR. Of many issues pointed out in the report were the governance, organisational restructuring and management and outsourcing of PR trains to the private sector,” says a former CEO of the PR.
For this, an agenda having 43 points along with practical recommendations has been provided in the report. This is for the first time a proper plan has been provided in the form of clear guidelines to PR which has been suffering losses of over Rs40 billion every year, he says.
Move aims at reducing whopping losses
According to the report, induction of private sector specialists in the relevant segments (freight, passenger trains business) has been strongly encouraged. It emphasises freight sector reforms as freight trains are commercially viable and generate profits in contrast to passenger trains which require high occupancy of around 85 per cent just to reach the breakeven point.
It points out that only 11 freight trains of the PR fetches 35pc of total revenue while 114 passenger trains generate the rest. Through this equation, the report emphasises the fact that PRFTC should handle all freight business.
Though the PRFTC had been formed by the PR in 2015 to handle all freight-related business, it [to date] reportedly handles one single project of Sahiwal (Yousafwala) coal transportation while operation of freight trains is handled by the PR’s divisional field formations.
In December last year, a source says, the government appointed Azam Swati as federal minister for railways and the core objective for his induction was to bring about reforms in the railways, restructure it as part of the government plan for loss-making enterprises and run it on a self-sufficient basis.
He says the very first agenda of all this exercise is to have capacity building planning especially in freight segment. So far three top professionals from the private sector have already been inducted in PR in finance, marketing and HR departments.
In February 2021, he says, the [railways] ministry directed the PR senior management to transfer all freight business to PRFTC for commercial management, outsourcing, freight terminals, track access and for development of freight hubs in the country.
The chairman says, under this plan, the department is also working on a proposal seeking establishment of a separate company (like PRFTC) to handle the passenger trains’ business.
“We are also thinking to hand over this business to the PR’s company - Pakistan Railways Advisory and Consultancy Services (PRACS). Besides this, a new software - Rail Automated Booking and Travel Assistance (RABTA) - has also been developed for reservation of passenger and freight trains,” Mr Gilani says.
Published in Dawn, July 21st, 2021
