Bangladesh Railway has decided to raise train fares every year from now on, in an attempt to cut down its losses and improve services.
For the first time ever, rail authorities would use a fixed calculation format to determine new fares, an annual process which is expected to come into place from next month.
The decision is currently pending approval from Prime Minister Sheikh Hasina, whose office has already received a proposal in this regard.
“Train fares are likely to be hiked from February 2016 after receiving the prime minister’s approval,” said Railways Minister Mazibul Hoque yesterday.
Talking to reporters during the inauguration of WiFi services at the capital’s Railway Bhaban, he said: “Although we have decided to hike the fare, it would stay in a comfortable level and would be comparatively lower than other existing transports.”
The last time train fares were revised in the country was in June 2012; that too also came after a gap of 20 years.
“From now on, train fares will be hiked every year. We are increasing fares to improve the standard of passenger service and minimise continuous losses,” said Railways Secretary Firoz Salauddin.
“We have introduced a new tariff-fixing format to calculate the rate of fare hike by measuring yearly maintenance cost, staff salary, and upgrading service and travel distance.
“The train fares would increase by 7.8% for this fiscal year, which has been calculated under the new format. The fare hike rate will change when the next calculation is made for the next year,” the secretary said.
“The hike [this year] will be a minimum of Tk5 and a maximum of Tk45,” Salauddin added.
Once the changes come into effect, a passenger would have to pay 39 paisa per kilometre instead of 36 paisa.
For example, the ticket for deluxe chair from Dhaka to Chittagong will become Tk340 from the existing Tk320; AC chair tickets will become Tk655 up from Tk610. Meanwhile, the Dhaka-Gazipur local train ticket would cost Tk20 instead of Tk15.
The railways secretary however expressed hopes that the rate of fare hike would come down next fiscal year if fuel prices are lowered.
“Bangladesh Railway suffers losses of Tk900 crore every year. It will be possible to reduce the loss to around Tk100 crore by raising fares,” said Salauddin.
However, Buet Professor Shamsul Haque, who specialises in the transport sector, told the Dhaka Tribune last month that railway authorities should focus on seeking out other income sources as well, because raising the fare cannot be the only option to reduce losses.
Asked about other revenue sources, the railways secretary said: “We also have some initiatives to develop internal income by constructing hotel, markets etc.
“We are also developing the goods-carrying system. Within the next fiscal year, we will be able to carry more goods,” he added.