Mumbai: Operating Mumbai local trains may become cheaper by Rs 100 crore by end-2017, with the railway having started a new programme called procurement and consumption efficiency (PACE).
When previously implemented in Delhi, the experiment had helped authorities cut costs by Rs 800 crore in areas such as energy consumption and procurement of rolling stock (trains).
In 2015-16, running Mumbai trains had led to a loss of Rs 1,600 crore in energy consumption bills, salary costs, and maintenance of rolling stock among others.
The railway board in a letter to central and western railway (CR and WR) said, “The strategy to achieve envisioned goals will include use of techniques such as improved inventory management, import substitution, re-look at/change in specifications, long-term procurement, development of cost-effective alternative materials, and value analysis. Needless to say, this exercise will entail a multi-disciplinary approach and cross-functional teams comprising officers from electrical/mechanical/signal and telecom, stores, and finance departments working together.”
The progress of PACE will be monitored every three months by the railway board, and a detailed report on how and which departments have been able to cut costs will be shared both with the board and the railway ministry.
An official said, “Railway in Mumbai has been making losses, even more so than other sections and cities and this has repeatedly been brought to the notice of the railway ministry. This time however, the ministry has basically told us to stop complaining and find some creative ways to cut costs.”
The cost cutting can be stretched to around Rs 100 crore. The official said, “We are already running railway in Mumbai as economically as we can but we will be looking at redundant costs and especially our power consumption, which is one of the highest areas of expenditure.”
Running trains on WR and CR has seen losses for the past 10 years. For example, the losses back in 2005-06 were limited to Rs 62 crore only, but ever since, losses have nearly doubled every year, finally reaching a jaw-dropping Rs 1,600 crore last year.
