The Delhi Government’s latest move to offer free rides to women commuters of the Delhi Metro showcases once again Mr Kejriwal’s old habit of offering populist subsidies just before elections. The current proposal has several financial, social, and logistical implications that have not been examined in depth and will be detrimental to the health of one of the best-run PSU’s so far.
The said proposal, which is estimated to benefit women commuters who supposedly comprise ‘30 to 33 percent’ of the riders, will be launched in 3 months and is likely to cost the Delhi government Rs 700 crore for this year. Mr Kejriwal has clarified that the entire cost will be borne by Delhi Govt and also specified that no permission from the Central government has to be taken for this move.
A careful examination of this announcement reveals several flaws which we believe have not been examined in depth.
Firstly, there are several financial consequences of this move, both on the government as well as on the DMRC. There is no data-driven basis to the figure of 30%women ridership that has been used to justify this move. It has been assumed that women straight up comprise ⅓ rd of the total riders. This data does not seem to have been derived from either the census of Delhi or from DMRC’s own figures. Given that the DMRC itself does not segregate men and women in its own report of ridership details, the financial cost of 700 crores seems to have been arrived on this flawed assumption.
Secondly, the financial report of DMRC, which has been compiled and is available in the public domain, reveals disturbing trends. DMRC currently owes approximately 2915 crores to JICA and 5134 crores to DEAMPL, which is a subsidiary of Reliance Infra. DMRC has consistently focused on meeting its debt obligations during the loan repayment cycle along with profits before tax while meeting its mandate of providing quality public transport. The fares in 2017 were hiked to increase the revenue, keeping these financial concerns in mind. While this move undoubtedly caused a decline in ridership, it was necessary so that DMRC could continue to be an efficiently run enterprise.
As India grows in stature and confidence, mismanaged and debt-ridden PSU’s depending on loans and external players seem out of place. Implementing this move will push DMRC towards indebtedness and be a blot on the civic pride of the capital. The official numbers in the following table also confirm this financial stress.
As can be seen, since the last 4 years, DMRC has seen a fall in the rate of revenue growth. Not only has the profit percentage as a share of revenue fallen, but the profits themselves have plummeted. Extrapolating from this data, it is anticipated that at this current trend, DMRC will have revenue of Rs 6,500 crores and it will be a miracle if it breaks even in the future.
Furthermore, as these extrapolated figures been arrived without including the free ride proposal, it will be unsurprising if Kejriwal’s latest move exacerbates the red figures on DMRC’s balance sheet.
The Delhi Government’s proposal to bear the Rs 700 crore losses also hides another major issue- that no cognizance has been taken of the fact that the operational and other running expenses of DMRC are increasing annually and these will NOT be paid by the Delhi Government and which have been conveniently overlooked by the Delhi Government.
Besides financial concerns, there are other pressing issues such as logistical implementation and execution- implementation of this freebie. While vague proposals are in the horizon such as having a separate line for women or an Aadhaar linked metro card for women, there can be no denying that the general public will find a way of misusing these women friendly facility. As is the case, instances of the public flouting coach rules are rampant in Delhi. While an Aadhar linked metro card can be implemented, the question remains as to how can such abuse be prevented and how these expenses are to be met.
ID linked fund transfers, which have been implemented by the Central government over the last couple of years, could be one way forward. Women from lower socioeconomic strata and other vulnerable women groups such as elderly or handicapped ladies can benefit from such a linkage– this will not only save taxpayer money and benefit genuine recipients but also promote the stated goal of increasing access to digital banking as part of Digital India initiative without wasting taxpayers’ money on such unnecessary freebie.
In fact, one may argue as to why should Delhi taxpayers subsidize travel of women to areas such as Gurugram and Noida when their respective state governments aren’t even bothering to financially pitch in. Given that there are other more deserving sections of society, why should the savings in financial costs be passed to only women?
Critics can argue that this move will increase women’s participation in public spaces. However, Women’s safety is a systemic issue that needs to be addressed by multiple stakeholders- civic society, government, police and law enforcement. Hasty measures are NOT the solution. The Delhi Govt’s patchy execution of such freebies and increasing women empowerment means that this move perpetuates gender stereotypes of women requiring patriarchal intervention at every step of their lives – an idea at odds with the idea of a progressive India.
These questions must provoke a larger debate.
DMRC is currently the world’s 2nd most unaffordable metro and lacks a sufficient user base or a revenue stream to sustain its operations. Should this be the direction our PSU’s and infrastructure projects take?
Also, why is it that we as a country love freebies and why is it that the government panders to such needs despite their detriment to the country? Sadly, Mr Kejriwal is symptomatic of our own ineptness, selfishness, and a pervasive desire to enjoy unearned privileges. As citizens, we should not only oppose such moves but also use such occasions to introspect as a collective society. Only then, can democracy be truly implemented?
Sources for the financials of DMRC:
