On Track

May 27, 2008 (LBO) – Sri Lanka railways will almost double rail fares to reduce losses and its dependence on government handouts as fuel prices continue to move up, officials said. From Monday fares of privately owned buses were raised by 27.2 percent and state-run buses by 17.0 percent.

Rail fares were last raised in 2005, but bus fares have been raised a number of times in between.

Sri Lanka Railways chief Lalithasiri Gunaruwan said the railways were now charging 50 cents per passenger kilometre compared to almost one rupee for buses.

This indicated a need to almost double fares. Transport minister Dallas Alahapperuma however has asked railways to keep fares just below that of buses.

Except for a few routes where the rail track was slightly longer than buses, Gunaruwan said the new rates would be lower than bus fares.

Last year the state railways lost 7.5 billion rupees. Though it had running expenses of around a billion rupees a year it was only able to get 2.5 billion rupees in revenue due to under pricing of fares.

A 30 rupee hike in diesel to 110 rupees a liter last week is expected to push up operating costs by a further 900 million rupees a y