When political interference, poor asset management, high tariffs, low quality of services and a constant loss of traffic to other modes of conveyance hit the Japanese Railways in 1987, a detailed restructuring plan was drawn up.
Under the plan, the government-controlled rail system was divided into seven different companies. By turn, these companies went public.
Services improved, competition brought down tariffs and efficiency rose.
Similar factors triggered reform processes in other railways across the world, including in New Zealand, the United States, Canada, Britain and Argentina.
The Indian Railways faces problems similar to the ones that plagued these railways. But for years, it has failed to respond to the challenge of chalking out reforms.
The Railways currently works on a century-old, top-down hierarchical model in which a six-member Railway Board headed by a chairman creates, implements and monitors the rail policy and takes all key decisions.
It is separated into 16 geographical zones that employ over 1.4 million people in a monopolistic operation.
Given this, the recent Railway Budget made a brief, yet key, announcement on restructuring the Railway Board by separating policy making from executive powers.
Other steps include modernisation of station and a deeper engagement with the private sector. Are things finally changing?
Text: Anusha Soni, Business Standard
Image: A worker signals to a crane operator while unloading steel rings from a goods train at a railway yard in the western Indian city of Ahmedabad.
Image courtesy: Reuters