railways-industry conclave: 'Perform or Perish' - Piyush Goyal

At a packed gathering of top corporate leaders, CEOs of leading global MNCs and MDs of several SMEs associated with the Indian Railways (IR), Railway Minister, Piyush Goyal prodded the captains of the Indian industry to think smart. The occasion was the annual FICCI conclave on “Smart Railways” in New Delhi. Corporate Citizen brings to you excerpts of Goyal’s speech and media interactions, showing why this chartered accountant-turned-smart-thinker matters, as political parties have got into 2019 election mode

The LED experiment

I think it may be much better if we had started looking in the perspective of what is good for the country, what is good for the railways. Let me assure you when there is a fair and equal competition, everybody will make money. I saw that happening in the LED program when I was the Union Minister for Power and New & Renewable Energy. As part of the Make in India campaign, we had significantly brought down the prices of LED bulbs—thanks to honest, transparent and competitive bidding, prices fell by as much as 87% and yet every one of those companies is making more money today than they made earlier. In fact, we could distribute crores of LED bulbs because of this steep price fall and that’s why India today leads the global efforts to promote LED and save energy to save the carbon footprints of the world. So, my argument is, if we can do it there, why can’t we do it here?

Now let me turn to questions some of you have raised about the GST and the inverted taxes. I’ll put this aside before I focus on Smart Railways.

GST brings equality

While I appreciate, like everybody else, you also want taxes to be low but here again please think smartly. If the ground rules are the same for everybody, then how does it matter? And, that’s what GST is all about. If there is an inverted duty, then how does it matter if there are six bidders or sixty because rules are same for everybody. So, if at all, somebody should be worrying, it should be me and not you, because if there is an inverted duty, some of you cannot use it for your final product. Hence, before you put forward a wish list, please analyses it smartly and see if it truly makes sense in terms of what’s good for the industry and the country.

So, for a change, let’s start focusing on simple things which can help us make IR smart. Just as Poul Jensen, Director, European Business and Technology Centre, said earlier in the conclave, I also strongly believe that today we’ve the unique opportunity to leapfrog. But how we can we do that if we’ve not sorted out some basic elements and that’s exactly what we’ve been trying for the last four years.

Capital expenditure nearly tripled

Let me give you an example as to how we’ve reignited the capex (capital expenditure) cycle? You all know, from 2009 to 2014, the total investment in the railways was of Rs.2.3 lakh crore only. But when we came to power in 2014, we ramped it up to 5.3 lakh crores. Why, because that’s the kind of quantum jump in investment IR needed. But it’s not just about 2.3 becoming 5.3 lakh crores or the capex cycle going up by almost 2.5 times in the last four years. It’s about how you invest that money that matters.

Why think smartly

There is every reason why we need smart thinking for Smart Railways. Unless we start thinking, planning and working smartly, we won’t be able to revamp India’s national carrier and it’ll continue to suffer huge losses. I hope that’s the kind of change some of you may have noticed in the last four years.

In fact, as the CEO of Apple Inc, Steve Jobs, had said, “Everyone here has the sense that right now is one of those moments when we are influencing the future,” I do believe every generation must have thought what we’re doing and what they’re doing is influencing the future. But I’ve the courage of conviction to say that under the dynamic leadership of PM Narendra Modi, we’re influencing the future in a very positive, progressive and smart manner. In fact, before me, Mr Sadananda Gowda and Mr Suresh Prabhu also got this very opportunity to do this in the short span of four years under the visionary leadership of PM Modi.

6000 stations in 6 months

Incidentally, Jensen also spoke about digital technology and how we could leverage on that, but we believe that if we’ve to leverage digital technology, the basic ingredient is to ensure access to technology in the remotest parts of the country. While the Government of India is working hard to take fiber optic and Internet to the remotest corners of India, the Railways is working on a program to ensure the last mile connectivity wherever we do not have fiber optics in our network. You’ll be happy to know Mr Jensen that in May of 2014 when we came to power; we had a negligible 358 kilometers of optic fiber cables across India. Today, it is upwards of 2.74 lakh kms of optic-fiber data pipes laid-over in just past four years and we’re hopeful that in the next six to- eight months, all railway stations across India, other than the halt stations, about 6000 stations, will be wi-fi enabled.

We already have about 700 wi-fi enabled stations and I promise you that the wi-fi at our stations will be faster than anywhere else in the world. It’ll be about 40 Mbps or so. I’m not a technical guy. I’m a chartered accountant, so if I’ve made a mistake here, you’ve to pardon me for my ignorance on technical terms. But we’re very serious about cleanliness issues at our stations. Our plan is to provide separate toilets for men and women, drinking water facilities, upgraded waiting rooms, wi-fi and CCTV cameras, introduction of advanced train sets, escalators for stations with footfalls of over 25,000 and such other modern facilities at every station in our country.

Bullet train is alive

By the way some people are still debating whether we need bullet trains or not. I personally believe that it’s our duty to engage with the most modern technologies in the world and bring them to India and let the people of India enjoy the benefits of what’s internationally the best in class. I’ll be only fulfilling a duty when I bring that bullet train to India. I feel sad that the Rajdhani was the last engagement with technology or high-speed trains that India had in 1969 and it took us 50 years to come to a stage where we’re looking at bringing in the Shinkansen technology to India, which was introduced in Japan in the year of my birth. What’s shocking is that we still have a set of politically motivated and out dated people who want our citizens to continue suffering old technology and poor service. They’ve politicized a simple thing like bringing modern technology to serve the people of India. But I want to assure you that this ambitious project of PM Modi is very much on track.

Yes, like every good project, this also faces certain difficulties in our country but we’re addressing them. I’m confident very soon all such issues including the acquisition of land in Maharashtra and Gujarat will be resolved through a continuing dialogue with local people. We’re trying our best to complete the work by 2022 before its 2023 deadline.

To my mind, this country is ready for change. India is yearning for change. The people of India want the best in the world for themselves. I think, as Indians, we deserve it and have every right to demand the best of technology for our public transport. As part of the Modi Government, I assure you that we stand committed to ensuring a Smart Railways and a Smart Nation so that every citizen of India gets a better future and the young people of this country never feel ashamed of us who did not leave behind a good legacy when they take over.

More for less

Why I say so is because I always think that even smaller things can make a big difference and make us smarter. One day an honorable Member of Parliament requested me to extend a particular train a bit further. This was very early last year when I was just made the Railways Minister. When we assessed it, we found that our Gatimaan Express, one of India’s fastest trains was highly under utilized. It takes less than two hours to reach Agra from Delhi in the morning and comes back in the evening which means it had less than four hours of utilization. And lo and behold, it opened-up a huge opportunity to us to be smart. We extended this train to Gwalior by adding another hour-and-a-half of travel time but there was still scope for more, and lo and behold, we’ve been able to take it to Jhansi, located in India’s most-backward Bundelkhand region, once famous for dreaded dacoits.

So, today, we’ve a premier train connecting the national capital to India’s most-backward region at literally zero incremental cost! Of course, my ideal best case scenario is to take it up to Khajuraho, our biggest tourist attraction, but I’m still not able to manage its timing. For, I want a way so that passengers can be back to Delhi by evening, but that seems difficult, though we’re trying.

So, its small things that make a difference and help you achieve hugely incremental results, because passenger traffic has gone up by 17 times, freight by almost 15 times in the last 70 years, rail routes growing by about 23 kilometers and we’ve been able to ramp up track renewal to 476 kms every month.

Despite the fact that 60% of our routes are over hundred per cent utilized, the potential within this network is still pretty huge. Once, we switch over to smarter signaling and successfully removing the permanent speed restrictions, things will change in a big way. Similarly, when the 1,50,000 rail bridges (some of them over 120-years-old) are audited and improved, there’ll be immense possibilities to explore. But that’s not all. With the current action plans in anvil for 100 per cent electrification, we’re also going to make the Indian Railways a net zero carbon emitter by 2030 and thus, coupled with some renewable strategies, IR will become a totally green network by the next decade. For, we’ve a dedicated team which, in partnership with others, is working towards this common goal.

Recently, we had a meeting with representatives of a very reputed foreign railways company who had studied one of our important routes and given us a report as to how we could increase the speed of our trains on that route. It was a $2 billion plan to increase the speed of trains on that route. They gave us three options. One was that we close down the entire stretch of 250 kilometers for two years. Another was to close it down every Saturday-Sunday for five years and the third, you shut it down for six or eight hours every day to implement it in seven or eight years. Now, how can you imagine me implementing any of these three scenarios? If I’d done it, all the power plants in that region would have shut down, three states gone without electricity and passengers shouting slogans outside my home, not even my office!

Be practical

So, when we’re looking at solutions, we’ve to be practical because with 22,000 trains chugging day-in-and-day-out from remotest corners of the country, it’s a network that works round the clock. Hence solutions have to be found within that framework to make it smarter.

While Railways is focussing on smarter project implementation, we’re also reviewing artificial intelligence. Data would bring in predictive maintenance, better monitoring, intelligent asset utilization and better passenger service

Manual to Digital

Punctuality, for example, was a very big issue and I used to wonder how the statistics seem to show that punctuality was relatively damn good. But with everybody complaining about it, we found, it was the station master who logs the time little before it actually comes in and the train becomes punctual. But a small solution sorted it out. We replaced the manual recording of time by station masters with digital data loggers placed at interchange points across the network and that ensured computer-generated time.

When we switched this system on, initially our punctuality fell by 20%, from some 80% to 62% but at least it reflected the truth. It was a small step which didn’t cost us anything. However, today the punctuality has improved to about 74% and last week it was 80% and we’re looking to take it up to 90% but this will be accurate. Now we’re working on putting a GPS device on every locomotive so that we’ll have every train marked on your mobile phone, knowing exactly where they are, and thus you can plan your journeys better.

But these were just about small interventions. Currently we’re looking at electrification in a big way because that’s going to save us nearly $2 billion every year, which otherwise I would have had to charge to the passengers. So, with efficient Railways, we don’t have to burden the poor.

GE diesel engines

But what do we do with the diesel engines that we already have? Thankfully, working day and night, our Railways’ engineers have figured out a solution for that also. They have worked out a method by which diesel engines will be converted into electric ones and that too without spending a dollar. So, we can have a fleet of new and efficient electric engines which will naturally have a huge impact on India’s carbon footprints and we’ll use the diesel locomotives to be supplied by GE as backups across the country, in border areas, for maintenance purposes whenever electrification needs to be repaired or set up. So we’ll have engines which are super efficient as backup.”

Upgadation of Coaches

People also sometimes ask as to what’s the state of upgradation of coaches and I want to tell you that we’ve developed more coaches in one year compared to what Railways produced under 10-years of the Congress-led UPA rule. Last year alone, we’ve produced 2,385 Linke Busch Hofmann (LBH) coaches in the country, meeting not just our domestic needs but some also for exports.


Incidentally, there used to be a big problem on punctuality also because of sudden traffic blocks. We’re exploring best strategies so that instead of these blocks, we can have smarter time tables. We’re also trying to simplify various processes be it related to procurement of wagons or otherwise so that we can bring even more efficiency in the whole system. My job is to protect the best interest of the railways but if you are inefficient it’s not railways’ job to keep you running and afloat.

As for efficiency, it’ll have to be both ways. If I’m trying to be more efficient, you too have to reciprocate. The industry can’t ask for a protectionist approach. I’m sure, as consumer, when you go to buy a bottle of water; you buy whatever is the best and most efficient, both quality and price-wise. If all things are equal, you won’t pay 20 cents more to an inefficient manufacturer. Same is true for us. If you’re efficient and willing to give me a lower price for a better product, why will I not go for it? I think that’s the only way to encourage efficiency in the whole system. This way, maybe one or two will be out of business, but if you’re not efficient, it’s not railways’ job to keep you running and afloat.

We’re also reviewing to engage ourselves with artificial intelligence. There is a lot which can be done with data being put to use with predictive maintenance, better monitoring and intelligent utilization of our assets and better passenger service. But we cannot do all this unless we get whole-hearted support of our industry because we’re partners-in-progress. So, your willing and active participation is the key to our success.

By Pradeep Mathur