Konkan Railway facing heavy losses

By Our Special Correspondent

NEW DELHI, AUG. 11. The Konkan Railway, the country's largest railway project since Independence, has suffered losses of Rs. 384.67 crores during 1999-2000 mainly due to the high cost of debt it had taken from the open market. The cost of servicing the debt went up because of the long delay in commissioning the project.

Although the Railways managed to meet its working expenses, it has landed into financial difficulty on account of the need to service debts incurred for carrying out construction. In the previous year, the Government-owned corporation had suffered losses of about Rs. 360 crores.

The other main reason for higher losses apart from the debt burden, according to officials, was the inability of the requisite goods traffic to accrue to the Railways. This was because the anticipated build-up of industries along the line had not taken place. Besides, 43 per cent of the traffic, according to a report submitted by RITES, was to come by diversion from the Indian Railways but operational inconvenience and line capacity constraints have been stumbling factors.

The corporation is now attempting to take up projects elsewhere in the country in order to pare its losses. During 1999-2000, earnings at Rs. 130.21 crores were slightly higher than the expenses of Rs. 111.67 crores, thus giving it a working profit of about Rs. 19 crores. However, this operational profit was wiped out due to financing cost of Rs. 314 crores, lease charges of Rs. 20 crores and depreciation amounting to Rs. 69 crores.

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Section  : National
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