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Kejriwal’s Reckless Free Ride

Kejriwal’s Reckless Free Ride
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By 2021-22, the expenses of running the metro will be Rs 4,268 crore while the revenue will be Rs 3,162 crore

EARLIER THIS WEEK, Delhi Chief Minister Arvind Kejriwal announced free travel for women in the capital’s metro network, the ailing Delhi Transport Corporation’s bus fleet and that of the cluster bus service. Kejriwal pegged the cost for these freebees at Rs 700-800 crore for the remaining part of the year.

As far as populist flourishes go, this one was waiting in the wings. To begin with, the date of the announcement was noteworthy. Made less than a week after results for the 2019 Lok Sabha elections were announced, it was a signal for some sort of ‘out of the box’ thinking on the part of a leader whose party had been trounced. This, however, was not the first time that Kejriwal had sought to intervene in the affairs of the metro—a joint partnership between the Union and Delhi governments. Two years ago, in 2017, Kejriwal had strongly protested at the recommendations of the Fourth Fare Fixation Committee (FFC) that were issued in September 2016. He only relented when the legal position—that the FFC’s recommendations are binding—dawned upon him.

Populism, however, is just one aspect of the demand to ‘free’ metro. The project provides an excellent transport service to the residents of Delhi but a gigantic sum of money has been incurred to build it. Until last year, Rs 70,443 crore had been expended up to the third phase of the project. Of this sum, the Delhi government only contributed Rs 8,682 crore. These costs are just the costs of construction. The metro is an expensive system to operate. The ease and comfort of travel comes at a high operating and maintenance cost. By 2021-22, just two financial years away, the expenses of running the metro will be Rs 4,268 crore while the revenue will be Rs 3,162 crore, a gap of Rs 1,106 crore. This will be a very different situation from, say, 2015-16 when the metro’s revenue was more than its expenses. By the time the Fourth FFC made its recommendations, the energy costs of the system had increased by a whopping 512 per cent between 2008-09 and 2014-15. Maintenance and other costs rose by an astounding 445 per cent during this time.

The last FFC was clear-headed in its analysis when it wrote that, ‘while the metro rail addresses the travellers’ needs, it follows that in order to sustain these benefits; the travellers must equally share the cost of operating and maintaining the system.’

The logic of these ideas eludes Kejriwal’s politics.

From the time he first got the reins of Delhi in December 2013 until now, populist politics has been his personal hallmark and that of his party. To an extent, he is responding rationally to the political situation in Delhi. The Delhi that people hailing radio taxis see and the one that riders of DTC buses observe are two very different ones. Very quickly, the civil servant-turned-politician learnt that pandering to the second Delhi was the key to his political existence and survival. The emphasis on providing free water to various colonies in the periphery, the repeated efforts to keep metro fares fixed, and now, make rides free for a class of passengers, is part of that populist make up. There is nothing free here: Delhi is dependent on neighbouring states for supply of water and is at their mercy on this score. Providing this scarce commodity ‘free’ at a time of water-stress across India is senseless. One does not have to charge exorbitant sums while providing water to the poor—that is cruel—but for the sake of responsibility, some money should be charged for a good that cannot be provided in a costless manner. And water certainly is one such commodity.

It is a facet of this mode of thinking that it underplays the costs involved and overstates the benefits. In his comments, Kejriwal said the system is unlikely to be burdened by free travel for women and he estimates an increase in ridership due to free travel by just one lakh per day. This is a figure announced at a press conference and not found by systematic analysis by experts.

In a growing city which is an economic magnet, traffic projects are liable to go wrong for a variety of reasons. Based on an assumption of 3 per cent increase in riders, the metro system is expected to carry 52 lakh people every day by 2021-22. Adding one lakh more every day doesn’t seem like a terrible burden. But in all likelihood, it will be: the metro has been designed keeping in mind a fixed limit of ridership beyond which the system won’t be able to cope. This has happened in the past as well. Some years ago, the metro was forced to go for longer, bigger, trains after the number of passengers rose dramatically. The frequency of trains was also increased to the point that no slack was left in the system. After that point, issues of train safety and sustainability kicked in.

The chief minister has asked officials to study these ‘proposals’ and the matter will be taken up by the Delhi cabinet.

There are, of course, a number of issues that are not clear. For example, won’t making ridership free for a class of passengers come under the ambit of revising fares? Fare revisions don’t happen just one way—upwards—but can be carried out downwards. In that case, isn’t that the job of a FFC and not the politicians? Furthermore, the Delhi Metro is an equal partnership between the state and the Union Government. Has the concurrence of the Union Government been sought? Finally, is there any reason to offer free travel to just women? There is a legal issue here as to why other needy segments should not be offered the same facility. On what basis was this selection made? No answers have been given for these questions.

What should the Union Government, especially the Urban Affairs Ministry that deals with the metro, do? For starters, the Lieutenant Governor can stop the proposals in their track for obvious reasons of financial unsustainability unless the Union Government concurs with them. For another, if for unavoidable reasons, the proposal has to go forward, the Delhi Metro Rail Corporation (DMRC) should be provided the money that it has incurred for free rides upfront on an annual basis. In turn, DMRC should have a system to measure the number of free rides and in case they exceed the lump sum money given to defray costs, it should insist on payment as quickly as possible.

Ideally, the proposal should be killed.

That may not happen as the election to the state legislative assembly is around the corner and the Bharatiya Janata Party (BJP), the ruling party at the Centre, may be wary of doing anything that will be politically adverse to its interests. It should have some faith in the residents of Delhi who know what is good for them and what is economically ruinous even if it is packaged as ‘good’ for them.

There is a hard upper limit to which these benefits can be extended. Like any other consumable item, the Delhi Metro, too, has a finite life. Already, the system is showing signs of ageing. It is time to stop populist experiments before the metro dies a slow and grinding death.