Independent regulatory body crucial for turnaround in railways, says Bibek Debroy panel

NEW DELHI: There is a need for a shift in the regulatory power from the government to an independent body to provide a level-playing field to private players who have been reluctant to enter the railway sector, an expert committee has suggested.

The eight-member panel, headed by economist Bibek Debroy, has suggested constitution of a regulatory authority with quasi-judicial powers for turnaround in the railways. A Railway Regulatory Authority of India (RRAI), with an independent budget, must be set up statutorily so that it is truly independent of the Railway Ministry.

The committee, in its interim report, has recommended that RRAI should have the powers and objectives of economic regulation, including, wherever necessary, tariff regulation, safety regulation and fair access regulation.

Besides, it should have access to railway infrastructure for private operators, service standard regulation, licensing and enhancing competition and setting technical standards.

A shift of regulatory responsibility from the government to an independent regulator is required as the private sector will only come in if there is fair and open access to infrastructure, the committee said.

Laying down the direction for a series of reforms needed in the public carrier, the high-level committee has felt the need of the Commissioner of Railway Safety to be integrated with, and subsumed under, the RRAI.

RRAI should be given the task of overseeing rules and norms that ensure fair competition for Special Purpose Vehicles (SPVs) that have been created through railway connectivity projects, the 323-page report said.

There should be a bifurcation of the dual role played by RDSO (Research, Design and Standards Organization) as an R&D organisation of railways and technical advisor to the Railway Board and as a standard-setting organisation.

"Whereas the setting of standards should come under the ambit of the RRAI, the technology role for railways can remain with it, or alternatively be clubbed with the Railway Research Centres that will now be set up in selected universities," it said.

The Bibek Debroy-headed committee has suggested that there should be an appellate tribunal which will hear appeals against the orders of RRAI and further appeals against orders of the tribunal can be directed to the Supreme Court.

The committee had been constituted for mobilisation of resources for major projects and restructuring of railways in September 2014 when the Ministry was headed by Sadananda Gowda, who felt the Railway Board had become unwieldy because of overlapping roles of policy formulation and implementation.

Envisaging a bigger role for RRAI, the eight-member panel said there is a need for a Public Service Costing exercise, independent of railways, which can be entrusted to RRAI.

The PSC exercise will determine costs incurred by Indian Railways and other service operators in providing social services such as construction, operation and maintenance of lines in specified locations and in providing specified rail services on select branch lines.