This presentation covers about REASONS FOR DECLINE IN PAKISTAN RAILWAYS .

1. Challenges and
Response

2. Challenges and
Response

3. 
Muhammad Arham Afzal
10-EE-66

Muhammad Naveed Iqbal
10-EE-182

Muhammad Rehan Raza
10-EE-122

Muhammad Farooq
10-EE-134

4. Introduction
 Importance of Railways and its Decline
 Problems Faced to Pakistan Railways
 Causes of decline
 How to fix it ?
 Conclusion


5. 

Pakistan Railways, lifeline of the country, is a
national state-run transport service. Among the
means of transportation railways are the
cheapest and safest mode for passengers and
goods. It also helps in growth of economy for the
country.
It is under the administration of federal
government and its head quarter is in Lahore. It
is an important source of transportation
throughout Pakistan. It carries millions of
passengers throughout the country. It used to
carry huge freight in Pakistan.

6. 


This cheap and safe mode for passengers is
now facing a number of issues.
A number of services of Pakistan Railways
have been cancelled, suspended or
terminated and many more will be suspended
in near future because of mismanagement
and shortage of locomotives, fuel and money.
The chapter of all major services, from Lahore
to Karachi, has been closed. It is pertinent to
mention that all AC services have been
stopped.

7. 


The incompetent administration has failed to
attain locomotives from any quarter of the
world.
Passengers are suffering due to
mismanagement of administration. Pakistan
Railways decision to suspend goods train
service due to severe shortage of locomotives
and fuel is another blow to this organization.
It is now basically financially bankrupt
organization. In other words it is on the verge
of financial collapse.

8. 


The political interference, nepotism, corruption,
poor maintenance of tracks & bridges and
mismanagement in almost every field are the
major causes of failure of Pakistan Railways.
Pakistan Railways purchased 69 completely built
locomotive units from China under 2003
agreement. These are about 37% cheaper than
the European locomotives but considered to be
faulty.
It is stated that 32 of these have already been
scrapped. Dong Fang Electric Corporation has
been severely criticized for producing low quality
locomotives.

9. 

Naturally trains are too late and passengers
can be seen sitting at platforms with their
luggage. A number of trains lack facility of
light at nights because of the failure of the
generators and ill attitude of management.
There are complaints that reservation is
confirmed after receiving bribe of hundred or
more rupees by passengers. Pakistan
Railways is no more the best choice to travel
for the passengers.

10. 
Pakistan Railways has been playing a very crucial
role in social, economic and political
development of Pakistan from

Employing more than 80,000 persons

Employment indirectly to at least ten times more

11. 


Contributes substantially to the GDP of the
country.
With more than 80 million passengers every
year
Being the cheapest mode of transportation
of goods and commuting passengers, it has
been the pivot of Pakistan’s development.

12. 


PR is not only a symbol of unity of the country
but also a vehicle of social and political
integration
Rail transport consumes only one sixth of the
energy per unit weight-km as compared to
road transport

13. 
Less polluting source of traffic-emissions

Rail death caused by accidents are much lower than road

Average death rate per year on roads are more than
10,000 per year as compared to less than 100 in railway
system.

14. 

During any disaster or emergency Pakistan
Railways has been the most preferred
means of transporting relief goods in the
shortest possible time
Keeping in view the geographical contours
of Pakistan, it is an excellent and
economical mode of transportation for long
distance goods haulage.

15. 


This public state enterprise is also the largest
civil employer in the country.
Over the years, lack of attention, poor policies,
increasing expenditures, misappropriation of
funds, nepotism and most recently, the floods
have left the Railways with huge deficits running
in billions of rupees.
Till the 1970s, Pakistan Railways was run by an
autonomous four-member policy forming
Railway Board which constituted a Member
Traffic, Member Mechanical, Member Civil and
Member Finance.

16. 

In 1990, the government appointed an officer
from the Civil Services of Pakistan chairman
and from then on there has been a rapid
decline not only in performance but also the
balance sheet of the organization.
Till 1990, the carriage factory in Islamabad
was exporting freight wagons and coaches to
Sri Lanka and Bangladesh, in addition to
meeting local requirements.

17. 


Rather than augmenting this facility, the lure of
kickbacks has resulted in its virtual shut down
and orders were placed for import of carriages.
Although Moghalpura has facility to produce
High Capacity (HC) wagons, the same were
imported from China.
These imported wagons have the handicap
that they cannot work on branch lines because
of axle load limitations.

18. 

Railways are suffering huge losses for
maintaining lines whose service has not been
done.
Railways are operating at low rates. A flexible
policy for rates and fare requires to be
adopted whereby freight rates could be varied
according to the type of commodities

19. 

The industrial units of railways are running at a
loss. The locomotive factory, sleeper factories
and the carriage factory as well as the other large
manufacturing units of railways need to be
converted into autonomous corporations.
The operational efficiency of the railways is very
low. The overall efficiency of the railways
requires to be improved through better
managerial and operational techniques.

20. 

The bulk of railways earnings are drawn from
freight services which are not being accorded
the priority they deserve.
Good traffic need to be accorded higher
priority in the assigning of locomotive power
relative to passenger services, particularly on
the branch lines.

21. Net Profit / Loss after deductions
Years of PR's Profit / Loss
Years
0
-10
-20
-30
-15.9
-13
-20.2
-23.06
-28.45
-13.3
Profit in
billions

22. 
Despite having world’s
best railway track
flowing across the
country like the course
of rivers, Pakistan
Railway proved is just
like a “White Elephant”
as its slope is on a ramp
in declining phase since
90’s.

23. 
1.
2.
3.
There are various reasons of the decline of
the Pakistan railway. They are categorized as:
Political causes
Technical causes
Managerial cause

24. 
Institutional dichotomy

Governance Issues

Corruption

25. 

Instead of a commercial
organization, became a bureaucratic
organization where rules and procedures
count more than end results.
Direct interference of bureaucrats in the
purely technical issues always leads to
ineffective service delivery.

26. 

Running a commercial organization with
political considerations cannot yield
profits, just losses.
Posting/ transfers made on political basis
which affects the operational efficiency and
employees morale.

27. Corruption is the biggest
problem
Pakistan Railways is facing today.
 A government spokesman said
that the Federal Minister Cabinet
approved Rs.10.1 billion in August
2011 for PR to upgrade equipment
but only Rs.1 billion has utilized in
PR’s concern.
 It is due to the no check and
balance in Pakistan railway


28. Shortage of Locomotives:
 The Pakistan Railways has a total of 546
locomotives but only 290 are on track while
the rest are out of order. Similarly, 70 per
cent carriages are out of service.
 Currently only 58 locomotives are in working
conditions and needs consistent repair and
maintenance.
 This is a major cause of the crisis of Pakistan
Railway in revenue generation

29. Bunged Supply of Fuel:
 This problem began from January 2011 when
a Pakistan Railway was unable to pay Rs.700
million to PSO and in consequences PSO
stopped the supply of fuel to Pakistan
Railway.
 According to a senior officer at Railways
Headquarter 30 freight trains had to be
stationed in yards.

30. Decrease in Revenues:
 Increased Costs:
 Consumer Dissatisfaction:
 Underinvestment


31. 



Constant fall in earnings of the Pakistan Railways has
been the prime reason for the continuous losses it is
suffering. This in turn is due to three major reasons
Reduction in its train operations either because of
shortage of locomotives and passenger bogies
Prices of oil are increase but Pakistan railway not
increase the prices
Corruption is the third major reason for the revenues
falling sort of the targets fixed annually

32. 


lack of proper checks and balances create
loopholes for corruption even in the presence of
best legal framework and institutional
mechanism
Pakistan railway has 90,000 employees which are
more than required
out of 90,000 employees 01 locomotive has a
burden of 1,516 employees other than the
operational cost

33. 


After 1973 Pakistan Railways' budget was amalgamated with the
national budget with the result that the profit they earned was
diverted to other heads, leaving less and less for its
maintenance, expansion and improvement.
On the other hand, the Government spent three times more on
road sector. It was this combination of neglect to railways and
preference to roads, which is the root cause of the present
malady of Pakistan Railways.
Ministry of Railways ,which is responsible for providing funds for
the maintenance and development of the provision of the railway
network has no long-term framework for capital support to
perform these roles.

34. 


There is no time management due to which
consumer is not satisfy.
Most of the complaints are about extremely low
quality of services provided.
Disrespectful attitudes of the employees towards
the passengers

35. 



Helping directly to increase Pakistan's growth rate
Providing safe, modern, convenient and comfortable
mode of transport for the public at affordable prices
Becoming hub of transport connectivity
National integration by providing the nation a symbol
and a vehicle of national unity

36. •
•
•
Finalize the national transport policy with
aim and objectives
It will give the direction to the transport
sector
It will also end the unnecessary competition

37. •
•
•
•
After the finalization of a transport policy, finalize
and promulgate new legal framework
Establish Railway Regulatory Authority (RRA).
Let the Ministry be responsible for policy
formulation
Corporatize PR and establish it as Pakistan Railways
Corporation (PRC)

38. •
•
•
•
Resolve the issue of social obligations of the
state vs. commercial expectations from PR
If Pakistan Railways have to be run as a
government department.
Salaries, pension, operational maintenance
and developmental
expenditure should be considered as public
expenditure

39. 
Pakistan railways needs to be run on purely
commercial considerations

Operational rationalization

Human resource

Assets-concentrating on core activities and
outsourcing peripheral activities, i.e.
education, health, sports etc.

40. 


Even the present legal framework and
institutional mechanism is robust.
Authority with responsibility and proper
incentives and rewards.
Add transparency in procurement and
sale, computerization of income, expenditure
and assets

41. 
Political corruption.

Financial corruption.

Right use of budget.

42. 
Pakistan railways needs
massive investment.

Providing budget on
time.

Need investment funds
even privatize it

43. 

critical areas which
need investment.
Is it necessary all fund
provide by state?

44. 
Suggestions for selling land of Pakistan railway

Commercialization PR’s assets other than land

Similarly sale of advertising rights

Scrutinitization of the contracts

45. 
Outsourcing of operation.

Corporation of entities.

Indigenization

46. 

Corruption control
Removal of nepotistic
persons

Timing and Scheduling

Decreasing the fairs

47. 



Keeping in view the strategic and commercial importance of an
efficiently run railways as well as social obligations of the state to
provide affordable and cost effective mode of transportation to the
public, Pakistan railways should be given due importance
National transportation policy should be finalized as early as possible
so that the funds allocated for transportation sector could be
judiciously distributed among different modes of transportation
Pakistan railways should be run on purely commercial considerations
and across the board subsidy needs to be replaced with targeted
relief to passengers with limited means,
Outsourcing of operations, corporatization of its entities with
subsequent privatization and a strict accountability regime are some
of the other essential measures for effective service delivery