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Wednesday, February 25, 2015

What do I want from Railway Budget: Premium Tatkal Improvement

In one phrase, a better implementation of Premium Tatkal.


Ever since Railways have started Premium Tatkal, my requests to my friends in Railways for Emergency Quota has reduced substantially. But it is not good enough. The system can be improved substantially. In fact, when I look at the current system, it almost appears that perhaps someone wants it to fail so that they can go back to the earlier system of lottery (frankly, Tatkal is nothing but a lottery, and that too a very stressful and wasteful lottery).

Consider, Shramshakti Express between Kanpur and New Delhi. There is a quota of 5 premium tatkal seats from Kanpur to New Delhi but none from New Delhi to Kanpur. So I can go to New Delhi and just get stuck there (or return by Shatabdi in the next morning). This asymmetry is inexplicable when, in fact, there is no difference in the demand pattern in the two directions.

But the bigger problem is that they haven't understood demand and supply issues very well, and continue to look at the quota allocation from political angles. For example, the long established policy of Indian Railways has been that there is higher quota for end-to-end passengers than from intermediate stations. This was fine as long as the fare was a linear function of distance. But with the fare having no relationship with distance, the quota has to take into account other factors. Let us take an example of Lucknow Shatabdi. The entire Premium Tatkal quota in Executive class. The costliest ticket can be more than Rs. 4000 from Lucknow to New Delhi. For a train that takes 7 hours to New Delhi, and one has to sit through it, this is not a very attractive proposition when there are flights costing less and taking a fraction of time. As a result, not enough seats are sold. However, for someone in Kanpur, paying Rs. 4000 for the same seat is not as much of an issue, since the alternative is to take a taxi to Lucknow airport, spending an additional Rs. 1,500 and spending an additional two hours. Of course, one can book from Lucknow to New Delhi with boarding at Kanpur (and that is how I get my last minute tickets on Shatabdi), but not many know this trick. It would help Railways in selling more Premium Tatkal seats on this train, if they explicitly allow Kanpur to New Delhi reservations under Premium Tatkal (they can still charge the Lucknow to New Delhi fare).

Similar issues are there on any long distance train between two big cities. Between Delhi and Mumbai, the Premium Tatkal fare in AC-2T could be as high as Rs. 6,000, again costlier than air fare on most days. It would be better if they allowed more expensive fares for smaller towns on the way, which have zero quota of Premium Tatkal and no option of traveling by air. On the other hand, they could benchmark their tatkal fares with air fares between big cities to ensure that they do fill up their Premium Tatkal seats.

I am afraid if they don't put in a bit more intelligence in their dynamic fare computation, then one day someone will look at data, figure out that many premium seats are not being sold and decide to scrap the quota.

The other major problem with Premium Tatkal is that it is just one day in advance. A whole lot of people who would have otherwise been willing to pay a high fare do not wait till the last minute. In fact, when I travel, I want both my forward and return journey tickets to be confirmed before I leave home. So, if I have to travel at a short notice, I might check Premium Tatkal in the outgoing direction, but there is no possibility of checking Premium Tatkal in the return direction, and hence I may cancel my travel altogether, or book an air ticket in the return direction. Railways loses a passenger who is willing to pay a high fare.

I hope that they can start Tatkal and Premium Tatkal bookins three days in advance.

There are many other services that Railways can provide to those who can afford it. For example, if I am traveling from Jaipur to Kanpur via Delhi, I often keep a large margin between the connecting trains, or alternately, book two tickets from Delhi to Kanpur, one with just one hour margin, and the other with 3-4 hours margin, and lose 50% fare on one of the two tickets. Now the one that I cancel is not filled up by a waitlisted passenger, and is largely left to the TTE's discretion, not a very good situation. If Railways were to offer a service which will formally charge me not 50 percent but say 25 percent more than the regular fare, and it will know a bit in advance whether I am taking the first train or the second train, it can actually give that other seat to the waitlisted passenger. So it benefits Railways, and it benefits passengers.

A similar service will be to have an alliance with an airlines (or multiple airlines) and offer a multi-modal ticket with part of the journey by air and part of the journey by train. If I can buy a combined ticket to fly from Hyderabad to Delhi and then take a train to Kanpur, with the Railways guaranteeing that I will be given alternate berth (perhaps from Emergency Quota) if my flight is delayed, I would be happy to pay extra for such a service.

Further, I often want to travel by AC-1st, but since there is no availability, I book myself in AC-2T. Of course, there is a huge Emergency Quota and VIP quota and other quotas in AC-1st, and if I had continued to be on the wait list, I would have most probably got a berth in AC-1st. I should be able to tell Railways my preferences and if at the time of charting, there is a vacancy in AC-1st, I should be given that berth. When someone is willing to pay for an upgrade, why give it to someone else for free.

These and many other ideas will lead to better service to the higher paying passengers, and higher revenues for the Railways, a win-win situation. And with online ticketing on IRCTC, doing all these is actually quite simple. Then where is the problem. The problem is really in the mindset.

We are not an inclusive society. And Railways is not an inclusive organization. It assumes that it is only for the poor. Railways has to include the rich in its thoughts. Railways must not be only for the poor, but it should also be for the rich.

4 comments:

Kamal Rayaguru said...

Thoughts well put sir !

Ashish Kuvelkar said...

with regards to this:
[I should be able to tell Railways my preferences and if at the time of charting, there is a vacancy in AC-1st, I should be given that berth]
I had similar but slightly different concept in mind. Let me explain with an example.

I want to travel by III AC from DR to PUNE by 2163. Ticket which I buy is wait-listed, so I also buy a confirmed SL ticket. There should be a provision to link the two tickets, where in passenger details are same. Now at the time of charting, if IIIAC ticket is confirmed, I should be refunded SL ticket money minus Rs. 20. If it does not get confirmed, I should be refunded III AC ticket charges

prasun said...

I think the demand for seats is way higher than supply. Increasing the supply dramatically should be on the plan.

Getting the budget for this might be an issue.

On a related note, China is also facing similar problems (and not doing much better): http://www.scmp.com/news/china/article/1713911/chinas-latest-cyberwar-battle-new-year-train-tickets

Dheeraj Sanghi said...

@Prasun, increasing the supply can only happen if you increase the revenue. And since an across the board increase in fares is politically difficult after Delhi elections and a major decrease in diesel prices, I am suggesting ways in which they can increase revenue. Having said that, I do not believe that increasing the supply is the only solution. I think we do need to manage demand. There will be more inter-city buses if Railways increase fares, just to give an example of alternatives. Also, within Indian Railways, there are lots of trains where tickets are available but they are at inconvenient times. There can only be finite capacity at peak hours. A good demand management strategy would be to have a premium for traveling at the peak time. And then the non-peak hour trains which are typically 14-18 coaches, as opposed to 22-24 coaches "popular" trains can enhance capacity. They too can become 22-24 coaches.

So I believe that if Railways can become more market oriented, it can serve its diverse set of customers better without putting any set into serious hardship.