Indian railways commercialisation

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Indian railways commercialisation

  1. 1. Submitted By : Avinash Roshan(2010MB70) Jitendra Singh(2010MB33) Kunal Bhasney(2010MB29) Sachin Kumar(2010MB44)
  2. 2. <ul><li>Indian Railways </li></ul><ul><li>The world’s second largest railway, carries 18 million passengers each day and it has </li></ul>Introduction to IR
  3. 3. FREIGHT (GOODS) 62% PASSENGER 28% OTHERS 10% SOURCES OF REVENUE
  4. 4. 98.3 96 92.3 92.1 91 83.2 78.7 75.9 Operating Ratio back
  5. 5. Commercialization of Indian Railways <ul><li>Commercialization is important aspect of Indian railways. </li></ul><ul><li>Aims at providing not only service but also to generate revenue. </li></ul>
  6. 6. Why Commercialization???
  7. 7. How it revolved?
  8. 8. Conceptual Framework
  9. 9. Retrenchment Strategy Effect 1 ) Reviewing value adding business (Catering, parcel service ) Cost saving > Rs 1,000 crores /annum 2) Reduction of wagon turnaround time 14 % time saved 3) Outsourcing Improved efficiency
  10. 10. Repositioning Strategy Effect 1 ) Developing new products (Double stack containers) Saving: 7% on capital cost , 25% operational expenses 2) Product differentiation E-ticketing, new passenger coaches 3) Focus on revenue growth(like enhancement in loading capacity, cash incentive to free up wagons) Freight revenue jumped from 233 m(2001) to 417 m(2007).
  11. 11. Re- Organization Strategy Effect 1) Changes in planning system Improved efficiency 2) Extent of decentralization ( like Zones raised from (2003) to 16 (2005)) Improved vendor satisfaction
  12. 12. Areas of Commercialization <ul><li>Transportation. </li></ul><ul><li>Introduction of I.T. </li></ul><ul><li>Outsourcing. </li></ul>
  13. 13. Transportation <ul><li>Daily expenditure is about Rs 100 cr (42% staff, 18% fuels). </li></ul><ul><li>Daily earnings Rs120 cr . </li></ul><ul><li>Daily loss on uneconomic branch line Rs 8 cr. </li></ul><ul><li>Greater competition from Roadways, with major investments in Highway network upgradation. </li></ul><ul><li>Upgradation of the Railway Production units for improved efficiency and productivity. </li></ul>
  14. 14. Transportation <ul><li>Goods Trains </li></ul><ul><li>Railway earns mainly from goods traffic. </li></ul><ul><li>More than a million ton of goods transported daily. </li></ul><ul><li>Carries 16 lakh tonnes of goods every day. </li></ul><ul><li>Railways has 7500 engines,38000 coaches & about 2.5 lakh of wagons. </li></ul><ul><li>Goods train maxm. 100 kmph. </li></ul>
  15. 15. Transportation <ul><li>Passenger Trains </li></ul><ul><li>Carries 1.4 crore passengers daily. </li></ul><ul><li>Greater attention to passenger services and safety. </li></ul><ul><li>Heavily subsidised passenger fares, distorted passenger pricing. </li></ul><ul><li>Indian railways have a share of nearly 22% in the passenger transport market. </li></ul>
  16. 16. Transportation <ul><li>VARIETY OF SERVICES </li></ul><ul><ul><li>AC FIRST CLASS. </li></ul></ul><ul><ul><li>AC SLEEPER. </li></ul></ul><ul><ul><li>FIRST CLASS. </li></ul></ul><ul><ul><li>AC 3 TIER. </li></ul></ul><ul><ul><li>AC CHAIR CAR. </li></ul></ul><ul><ul><li>SLEEPER CLASS. </li></ul></ul><ul><ul><li>ORDINARY CHAIR CAR. </li></ul></ul>
  17. 17. Usage of IT in Railways <ul><li>A large complex Infrastructure System with Large Geographical Dispersion such as the Indian Railways can benefit greatly from the intelligent use of IT </li></ul><ul><li>E-GOVERNANCE OBJECTIVE </li></ul><ul><ul><li>Freight revenue enhancement </li></ul></ul><ul><ul><li>Passenger revenue enhancement </li></ul></ul><ul><ul><li>Improvements in Customer and public service </li></ul></ul><ul><ul><li>Investment optimization </li></ul></ul>
  18. 18. Usage of IT in Railways <ul><li>Transforming Transport through Technology. </li></ul><ul><li>Jewels in the Crown. </li></ul><ul><li>Freight Operations Information system ( FOIS). </li></ul><ul><li>Passenger Reservations System (PRS). </li></ul><ul><li>Unreserved Ticketing System (UTS). </li></ul><ul><li>Instant voice response system (IVRS). </li></ul><ul><li>Rail Net. </li></ul><ul><li>E- Ticketing. </li></ul>
  19. 19. OUTSORCING <ul><li>IT giants like TCS and WIPRO eyeing Railways' outsourcing deal. </li></ul><ul><li>L&T Infotech wins system integration projects from Indian Railways. </li></ul><ul><li>Indian Railways formed a PPP cell at the Board level to guide in the initiatives of Indian Railways . </li></ul><ul><li>Organisations like RITES, RVNL, CONCOR, IRCTC, etc. have been formed as an FBO. </li></ul><ul><li>Parcel Service, Catering,Vinyl Wrapping of trains,Palace on Wheels are part of outsourcing of IR. </li></ul>
  20. 20. Parcel Management System <ul><li>Following Functions are covered </li></ul><ul><ul><li>Parcel Booking, Cancellation and Loading </li></ul></ul><ul><ul><li>Monitoring and tracking of Parcels </li></ul></ul><ul><ul><li>Printing of Parcel labels </li></ul></ul><ul><ul><li>Networking of all parcel offices </li></ul></ul><ul><ul><li>RFID tags for tracing parcels </li></ul></ul>
  21. 21. Vinyl wrapped train by Airtel 80 crores contract with airtel and kurkure for ad
  22. 22. Catering
  23. 23. PALACE ON WHEELS
  24. 24. WHEELS OF CHANGES <ul><li>MoU with CHINESE counterpart </li></ul><ul><li>Rail fleet with eco-friendly technology </li></ul><ul><li>Train traffic control will be computerised soon </li></ul><ul><li>WI-FI will be introduced soon in business class </li></ul><ul><li>Railway will utilize solar energy </li></ul>
  25. 25. What`s next now???
  26. 26. References <ul><li>www.indianraiways.gov.in </li></ul><ul><li>www.indianrail.gov.in </li></ul><ul><li>[email_address] </li></ul><ul><li>www.rbi.org.in </li></ul><ul><li>www.reservebank.com </li></ul><ul><li>www.irfca.org </li></ul><ul><li>en.wikipedia.org </li></ul><ul><li>Rakesh Mohan Committee. 2001. Highlights of the Executive Summary </li></ul><ul><li>Raghuram, G. 2007. ‘Turnaround’ of Indian Railways: A critical appraisal of strategies and processes’, Indian Institute of Management Working Paper no. 2007–02–03, Indian Institute of Management, Ahmedabad. </li></ul><ul><li>A Case Study </li></ul><ul><li>Desh Gupta and Milind Sathye* </li></ul><ul><li>Faculty of Business & Government </li></ul><ul><li>University of Canberra, Canberra, Australia. </li></ul>
  27. 27. References <ul><li>www.indianraiways.gov.in </li></ul><ul><li>www.indianrail.gov.in </li></ul><ul><li>[email_address] </li></ul><ul><li>www.rbi.org.in </li></ul><ul><li>www.reservebank.com </li></ul><ul><li>www.irfca.org </li></ul><ul><li>en.wikipedia.org </li></ul><ul><li>Rakesh Mohan Committee. 2001. Highlights of the Executive Summary </li></ul><ul><li>Raghuram, G. 2007. ‘Turnaround’ of Indian Railways: A critical appraisal of strategies and processes’, Indian Institute of Management Working Paper no. 2007–02–03, Indian Institute of Management, Ahmedabad. </li></ul><ul><li>A Case Study </li></ul><ul><li>Desh Gupta and Milind Sathye* </li></ul><ul><li>Faculty of Business & Government </li></ul><ul><li>University of Canberra, Canberra, Australia. </li></ul>

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