IR improves operating ratio in 2020-21

In a notable development, IR has been able to improve its operating ratio in 2020-21. It reportedly stands at 97.45 per cent as compared to 98.36 per cent in the corresponding period for 2019-20. A lower operating ratio implies that there are more financial resources available for expansion and growth. The improvement in IR’s running costs signifies that the national transporter was able to lower its expenditure and make up for the shortfall in passenger traffic through revenue generated by freight operations. IR has been able to utilise its resources and increase savings because it operated nearly 65 per cent of the trains till end 2020 without any concessions for any category of passengers. Further, with the electrification of major routes, IR saved Rs 95 billion in traction costs over 2019-20. Similarly, savings of Rs 40 billion were generated through rationalisation and optimisation of duties. Other revenue enhancing measures include targeting progressively higher traffic throughput, expansion of the commodity basket, effective and innovative marketing strategies to capture more traffic through business development units at all levels, optimum utilisation of existing rail infrastructure (including rolling stock), enhancement of productivity and efficiency, and focus on increasing the share of non-fare revenue sources in IR’s total revenue.