Cabinet approved proposal for setting up Rail Tariff Authority to advise Railway Ministry on fares

January 24, 2014

The Cabinet Committee on Economic Affairs (CCEA) approved a proposal to constitute a Rail Tariff Authority (RTA) that will advise the Railway Ministry on fares. The RTA is crucial for railways as it will recommend fare revision from time to time taking into account input cost and volatile market condition.

• As per existing law, The RTA’s recommendations will not be mandatory for railways as only the Railway Board can fix the tariff.
• RTA will be given mandatory powers only after the amendment of the Railway Act, 1989, in Parliament which is doubtful to happen in the UPA-II regime whose term comes to an end in a few months.
• The next government will initiate the process of making RTA a mandatory body by amending the Railway Act, 1989 to insert a sub-section called Chapter 5 (A).

The CCEA also approved to set up:

• An electric locomotive factory at Madhepura and a diesel locomotive unit at Marhowra, both in Bihar.
• The Amritsar-Kolkata Industrial Corridor (AKIC) and to form the AKIC Development Corporation (AKICDC).

A joint venture firm for developing infrastructure in integrated industrial townships in Uttar Pradesh along the Delhi Mumbai Industrial Corridor (DMIC).