Finance Minister P. Chidambaram on Thursday said that the latest hike in railway fares was an economic decision and was taken to revive the financial slowdown of the country.
Chidambaram justified the Congress-led UPA Government's move to hike rail fares.
"Railway fares have not been hiked for ten years. I think, yesterday, our colleague, the Minister of Railways briefed the media and explained why it was unavoidable to increase the passenger fares, given the state of health of finances of the railways and I think, it is a fair game for opposition to oppose for the sake of opposition," said Chidambaram.
"The last time, the fares were hiked by the NDA (National Democratic Alliance) Government, when Nitish Kumar was the Railway Minister. So, I think these are sound economic decisions and I don't think we should politicise these decisions," he added.
Chidambaram also said that it was unavoidable to hike the passenger's fares, considering the state of health of finances of the railways.
The Bharatiya Janata Party (BJP) has termed the government's decision to hike the rail fares as atrocious.
Ahead of the proposed railway budget for 2013-14, Railway Minister Pawan Kumar Bansal yesterday announced a fare hike that will take effect from January 21 midnight.
Addressing a press conference here, Bansal said that having hiked the railway fares now, the government will not increase the tariff in the budget.
"Train fares will be hiked from January 21 for all passengers, including the AC-1 and AC-2 tier passengers who were affected in early 2012. The hike will be two paise per km to 10 paise per km across classes. All fares will be rounded off to Rs 5, and there will be no fare hike in the Railway Budget," he said.
Justifying the hike, Bansal said passenger segment losses are likely to touch Rs 25,000 crore in the current fiscal.
"Input costs have increased immensely while rail fares have remained stagnant. In fact there was a decrease in lower class fares. Given economic slowdown, we have not been able to so far achieve this year's targets in either freight or fare side," he added.
He said that the slowdown has further impacted railways' earnings.
He further said hat extra revenue earned through the fare hike will be used to maintain cleanliness and safety. (ANI)