Railways Budget: A Critical Analysis

Today was the 5th railway budget by Mr. Lalu Prasad Yadav. Here are the highlights (collated from budget speech and rediff budget highlight:

• Railway profit in 2007-08 at Rs 25,000 crore
• AC first class fare cut by 7% only for few coaches
• AC 2 tier fare down by 4% only for few coaches
• AC 3 tier fare cut by 3%only for few coaches
• 5% cut in petrol, diesel freight
• Special focus to be given on railway projects in the North Eastern Region Route of 16 trains to be extended
• 6 lakh bulbs to be replaced by cfl lamps by railways to save energy
• 2500 old signals to be replaced by railways. Special trains to anandpur sahib, patna sahib and nanded 155 new lines to be completed
• 50% concession for AIDS patient
• Foot overbridges at all high-level platforms
• Northern railway main hospital in Delhi will be fully airconditioned. Divisional railway hospitals in Jaipur and Hubli will be upgraded.
• New rail coach unit to be set up in Kerala
• 1,000 megawatt captive power plant to be set up in Nabinagar in Bihar
• Ten new Garib Raths and 53 new trains to be introduced
• Railway tickets to show expected time of arrival
• Thirty per cent discount to senior citizens for rail travel and 50 per cent discount for women in all classes
• Mother Child Health Express to be started
• Clearance given for western freight corridor from Delhi to JNPT, Nhava Sheva, adjoining Mumbai
• Close circuit TV and bomb detecting equipment to be installed at major stations
• Doubling of lines to be given priority
• Railways planning smart card-based ticketing system
• CCTvs at all important stations
• Modular toilets to be introduced in trains
• 'Go Mumbai' card to be sold at bus depots
• Freight loading estimated to increase from 650 mt to 1100 mt by 2011
• New policy for wagon leasing
• By 2010, all coaches will be made of steel
• Professional agencies being involved on a pilot basis to ensure cleanliness in running trains
• Work on automatic signalling to start in new sections
• Railways to bring in led displays in stations on train arrivals/ departures
• Stainless steel coaches for mail and express trains
• Cleanliness drive on rajdhani and shatabdi trains
• Railways show a surplus of rs 68,778 cr in last four years
• Railways to provide escalators at 50 per cent of the stations in the country
• Railway Minister Lalu Yadav announced that Indian Railways will introduce 15,000 ticketing counters in the next 2 years
• The Railways plans to offer tickets through mobile phones
• By 2009 call centre based inquiry services to be unveiled
• Issuance of wait-listed e-tickets will also allowed
• Operating ratio of the Railways was at 76%
• Rs 49,250 crore invested into new railway projects
• Railway plan size increased from Rs 11,000 crore to Rs 30,000 crore in the last four years
• Productivity of Railway assets has been constantly increasing
• Railways attained 790 tonne payload target in the year 2007-08
• E-ticket booking is likely to rise to 300,000 from 100,000 in a year
• Freight traffic target of 785 million tonnes crossed to touch 790 million tones
• Railway plan size increased from Rs 11,000 crore to Rs 30,000 crore in the last four years.
  560 railway station platforms to be lengthened to take long trains
• Middle-level and low-level platforms to be upgraded to high-level platforms in several stations to help commuters
• More facilities for women and old passengers

New Garib Raths
1. Jaipur-Chandigarh (Tri-weekly) via Rewari-Bhiwani
2. Secunderabad-Visakhapatnam Express (Tri-weekly)
3. Varanasi-Delhi (Tri-weekly)
4. Bangalore-Kochuveli(Tri-Weekly)
5. Ranchi-Delhi (Bi-weekly)
6. Jammu Tawi-Kathgodam (Weekly) (in lieu of Nizamuddin-Dehradun Garib Rath Express
announced in the Railway Budget 2007-08)
7. Yesvantpur-Puducherry (Tri-weekly)
8. Jabalpur-Mumbai (Bi-weekly)
9. Delhi-Jaynagar (Bi-Weekly) via Patna
10. Pune-Nagpur (Tri-weekly)

New Trains
1. Amravati-Mumbai Express (Bi-weekly)
2. Chennai-Tiruchendur Express (Weekly)
3. Hyderabad-Usmanabad Express (Tri-weekly)
4. Bhubaneshwar-Mumbai Express (Bi-weekly) via Sambalpur
5. Amritsar-Saharsa Jan Sadharan Express (Weekly) via Hasanpur
6. Ranchi-Chopan Express(Tri-weekly)
7. Asansol-Mumbai Express via Jasidih (Weekly) with restoration of Howrah-Mumbai Mail
via Gaya on all 7 days of the week
8. Kamakhya-Gandhidham Express (Weekly)
9. Kochuveli-Dehradun Express (weekly)
10. Jaynagar-Saharsa Janaki Express (Tri-weekly) via Hasanpur
11. New Dibrugarh Town-Kamakhya Express (Tri-weekly) via Moranhat
12. Machallipatnam-Bangalore Express (Tri-weekly)
13. Surat-Muzaffarpur Express (Weekly) via Azamgarh-Chhapra
14. Amritsar-Kochuveli Express (Weekly)
15. Delhi-Pathankot Express (Tri-weekly) via Amritsar
16. Malda Town-Patna Express (Tri-weekly) via Bhagalpur
17. Indore-Udaipur Express (Tri-weekly) via Ratlam
18. Varanasi-Rameshwaram Express (Weekly)
19. Delhi-Jogbani Link Express (Weekly)
20. Khajuraho-Delhi Link Express (Tri-weekly)
21. Kamakhya-Gaya Express (Weekly)
22. Ramnagar-Delhi Link Express (Daily)
23. Kolkata-Murshidabad Hazar Duari Express (Weekly)
24. Mathura-Chhapra Express (Tri-weekly)
25. Gwalior-Indore Express (Tri-weekly)
26. Udaipur-Delhi Chetak Express (Tri-weekly) via Ajmer-Neem-ka-Thana
27. Puri-Darbhanga Express (Weekly)
28. Yeswantpur-Jodhpur Express (Weekly)
29. Radhikapur-Delhi Express (Weekly)
30. Vasco-da-gama-Patna Express (Weekly) via Konkan railway
31. Paradeep-Bhubaneshwar Express (Daily) in lieu of one pair passenger service between
Paradeep and Cuttack.
32. Bilaspur-Pune Express (Weekly)
33. Kendurjharagarh-Puri Express (Daily)
34. Gaya-Chennai Express(Weekly)
35. Balharshah-Mumbai Link Express (Daily)
36. New Dibrugarh Town-Yesvantpur Express (Weekly) via Moranhat
37. Ranchi-Bhagalpur Express (Tri-weekly) via Kiul in lieu of 3405/3406 Ranchi-Bhagalpur
Varanchal Express (Bi-weekly via Kiul)
38. Lucknow-Delhi Air Conditioned Express (Tri-weekly)
39. Dehradun-Delhi Air Conditioned Express (Six days)
40. Ahmedabad-Mumbai Air Conditioned Express (Weekly)
41. Chennai-Rameshwaram Express (Daily) via Mayiladuthurai-Karaikudi (after Gauge
conversion)
42. Chennai-Tiruchchirappalli Express (Daily) via Mayiladuthurai (after Gauge conversion)
43. Chennai-Salem Express (Daily) via Vriddhachalam (after Gauge conversion)
44. Madurai-Tenkasi Passenger (Daily) (after Gauge conversion)
45. Villupuram-Mayiladuthurai Passenger (Daily) (after Gauge conversion)
46. Mysore-Nanjanagud Town Passenger (Daily) (after Gauge conversion)
47. Ahmedabad-Patan Passenger (Daily) (after Gauge conversion)
48. Dabhoi-Pratapnagar Passenger(Daily) (after Gauge conversion)
49. Hajipur-Phulwaria passenger (Daily) (upon commissioning of new line)
50. Itarsi-Katni Passenger (Daily)
51. Shoranur-Nilambur Road Passenger (Daily)
52. Tirunelveli-Tiruchendur Passenger (Daily)
53. Vasai Road-Panvel MEMU (Daily)

Extension of Trains
1. 8611/8612 Varanasi-Ranchi to Sambalpur via Rourkela (Bi weekly)
2. 2677/2678 Bangalore-Coimbatore Express to Ernakulam
3. 4207/4208 Delhi-Raebareli Padmavat Express to Pratapgarh
4. 7405/7406 Tirupati-Nizamabad Krishna Express to Adilabad
5. 3225/3226 Danapur-Darbhanga Express to Jaynagar
6. 2855/2856 Nagpur-Raipur Express to Bilaspur
7. 2691/2692 Chennai-Bangalore Express to Sri Sathyasai Prashanti Nilayam
8. 6733/6734 Madurai-Manmad Express to Rameswaram on one side and Okha on the other
9. 2141/2142 Rajendranagar (T)-Lokmanya Tilak (T) Express to Chhatrapati Shivaji
Terminus
10. 2409/2410 Nizamuddin-Bilaspur Gondwana Express to Raigarh
11. 4201/4202 Mathura-Lucknow Express to Patna
12. 2083/2084 Coimbatore-Kumbakonam Jan Shatabdi Express to Mayiladuthurai (after
Gauge conversion)
13. 1423/1424 Solapur-Bagalkot Express to Gadag (after Gauge conversion)
14. 571/572 Bangalore-Salem Passenger to Nagore (after Gauge conversion)
15. 724/725 Tuticorin-Tirunvelveli Passenger to Tiruchendur
16. 356/357 Dharwar-Gadag Passenger to Bijapur

Increase in frequency
1. 2425/2426 New Delhi-Jammu Tawi Rajdhani Express from weekly to daily
2. 2203/2204 Amritsar-Saharsa Garib Rath from bi-weekly to tri-weekly
3. 2449/2450 Nizamuddin-Madgaon Goa Sampark Kranti Express from weekly to bi-weekly
4. 6513/6514 Bagalkot-Yesvantpur Basava Express from tri-weekly to daily
5. 3403/3404 Bhagalpur-Ranchi Express via Andal from five days to daily
6. 2891/2892 Baripada-Bhubaneswar Express from tri-weekly to six days a week
7. 2151/2152 Lokmanya Tilak (T)- Howrah Samrasta Express from weekly to bi-weekly
8. 2421/2422 Bhubaneswar-New Delhi Rajdhani Express from bi-weekly to tri-weekly
9. 2947/2948 Ahmedabad-Patna Azimabad Express from weekly to bi-weekly
10. 2431/2432 Nizamuddin-Thiruvanthapuram Rajdhani Express from bi-weekly to tri -
weekly
11. 5109/5110 Varanasi-Rajgir Buddh Purnima Express from tri-weekly to daily


MY COMMENTS
The budget seems to be a mix of future vision (horizon for 10 yrs) and next years action plan. At the broadest level, one wonders whether this vision would be continued by the next railway minister and has it come a little late in his tenure. Given that railways was on the verge of bankruptcy one could not have expected an action plan for next five year in his first budget itself. However, once the turn around (both financial and mindset) had happened, one could have expected a vision statement last year itself.

Getting into the specifics of the budget, it makes sense to cut the freight rates for two reasons: (i) commercial competition from road sector and (ii) help finance minister control inflation. Lowering the rate would increase the share of railways and would help them earn higher revenue. It is also important to understand the fine prints of freight rate reduction. The rationalization of classification of commodities should be seen together with the reduction. A closer look suggests that the rates are based on macroeconomic and commercial considerations. Reverse logistics and end to end solutions would not only make them more competitive but also would make them financially healthier. It is nice to see that a government department is thinking like a competitive corporate.

The reduction in passenger fares are contingent upon the popularity of trains and off peak season (fine print of budget speech). One can call it a political pitch and a mirage rather than any reduction. However, if we think in terms of real value of money, there is of course a reduction in fare (even if it were kept at the same value as last year for the whole next the year). So, this step needs to be applauded.

The emphasis on cleanliness and introduction of modular toilets are a welcome step. An idea of onboard private agency to clean the railway compartment would go a long way in making it hygienic. Some aspects of safety have also been addressed by proposing construction of RoB/RuB and manning the gates. It would also create employment.

Use of IT to provide information to passenger, once introduced would reduce a lot of haste. Proposal for a power plant is also a welcome step given the requirements of railways and current power demand-supply status.

Some the things which did not get enough attention was the poor behavior of railway employees and security persons with passengers. They could have been addressed with proposal of proper training of the employees to become a service provider organization from an infrastructure company. Security persons need to be trained as well as incentivised for better behavior through some mechanism. Any complain should be taken very seriously and should be processed without harassment to the passenger.

Given that there is only one year of the tenure left, implementation of the projects on priority basis would be the most critical point to look for. Various issues lead to lot of delay and the gestation period seems to be much higher than what it could be.

In short, there is a clear signal from the railways that it is no more a lackluster government agency for infrastructure creation but on the way to become a vibrant corporate organization focused on service provision. Hope the implementation is proper and we see a new era in the history of Indian Railways!!!

Dialogue, Debate, and Discussion

Today I was wondering about the difference between dialogue, debate, and discussion. I could think of the following points. I look forward to have getting inputs to make to sharper.

Dialogue	Debate	Discussion
It is a collaborative/cooperative exercise. In this case multiple sides work toward a shared understanding	Debate is competitive and/or oppositional exercise. Here multiple sides try to prove each other wrong.	Multiple sides try to work towards achieving a common goal. However, each party holds on to a point of view and rather than trying to prove the other party wrong, the intention is to talk about issues less passionately.
In dialogue, one listens to understand, to make meaning, and to find common ground	In debate, one listens to find flaws, to spot differences, and to counter argue	Here both types of action can take place.
Dialogue enlarges and possibly changes a participant's point of view	Debate defends assumptions as truth;	Parties tend to search more about each others point and have higher regard than debate for another persons point of view
Dialogue creates an open-mined attitude. An openness to being wrong and an openness to change	Debate creates a close-minded attitude. A determination to be right.	Discussion often tends to lead toward one "right" answer
One submits the best thinking expecting that other person's reflections will help improve it rather than threaten it	One submits the best thinking and defends it against challenges to prove that it is right	It is a mix of both debate and dialogue actions.
Dialogue calls for temporarily suspending of one's beliefs	Debate calls for investing wholeheartedly in one's beliefs	It is a mix of both debate and dialogue actions.
One searches for strengths in all positions	One searches for weaknesses in the other positions	It is a mix of both debate and dialogue actions.
Dialogue respects all the other participants and seeks not to alienate or offend	Debate rebuts contrary positions and may try to demean other participants	One respects other participants. However, if something goes wrong, elements of debate are explicit.
Assumption: many people have pieces of answers and that cooperation can lead to a greater understanding	Assumption: a single right answer that somebody already has	No prior commitment on one single right answer. One tries to arrive at some set of solutions
Dialogue remains open-ended	Debate demands a conclusion	It can be either way
Dialogue is mutual inquiry, collective knowledge	Debate is individual opinions/ individual knowledge	Discussion is also individual opinions/individual knowledge
Practices a product	Produce products	Produce products
Dialogue is divergent	Debate is convergent	Can be either way, however normally convergent

Urban Transport Integration

I have often wondered about the poor state of integration of urban transport services in India. In this blog, I am considering various ways in which integration can be achieved in India.

Definition of integration
While reading through various articles on this topic, I came across a set of documents which consider integration is a process or while another set of documents which consider integration a state of a system. Prior is the dynamic perspective in which integration is a process while latter is a static perspective where integration is a state of transport system at equilibrium.

According to dynamic perspective, there is an optimal process of integration that will eventually lead to an optimal state (which itself keeps changing). The challenge is to find the optimal process i.e. optimal institutional structure and regulatory mechanism to achieve integration. According to static perspective, there is an optimum level of integration and the system has to achieve this state by any process. Thus, the relevant question is to find the optimal state i.e. mix of transport modes and level of integration.

To me, both of these questions (what is the optimal process of integration and what is the optimal level and mix of integration) are important and both these questions should be answered together and not separately.

Some transport planners consider integration to be applicable only to the public transport modes and interactions within the public transport. But, most of the transport planners believe that integration should encompass whole transport mobility chain i.e. it should consider public as well as private transport modes including non motorized transport modes. In recent years, planners have adopted even wider concept for integration, where integration also includes convergence of transport planning and urban and land use planning.

Here, I am defining integration as a dynamic process which leads towards an optimal state of transport considering whole transport chain. It also include the convergence of urban planning and transport planning as a part of integration process in order to achieve a sustainable transport system. I am only focusing here on integration of public transport and the instruments which could be used to integrate services. Various kinds of integration in urban public transport include complementary routes, schedule integration (frequency matching), fare integration, physical integration of transfer points, information sharing, common marketing, resource sharing and technology sharing.

To me, there are three main ways of making these integration happen: market driven (informal arrangement-driven by the economic incentives of all the players involved), coordination driven (formal arrangement among service providers-mainly driven by the one group of players and the benefit is shared with all), and government driven.

1. Market driven
Simplest possible instrument is a market driven phenomenon. The level of integration keeps increasing as the system evolves over a period in a given urban area. Such integrations are driven from supplier side due to their commercial interests as illustrated in the table below

	Before Integration			After Integration
	Player 1	Player 2	Total	Player 1	Player 2	Total
Revenue	1100	600	1700	1254	654	1908
Cost	1000	500	1500	1100	525	1625
Profit	100	100	200	154	129	283
% Profit	10%	20%	13%	14%	25%	1

Source: Idea adopted from NEA et al., (2003)

The table above shows (a hypothetical case) how integration can be beneficial for both parties under certain assumption of cost and revenue increase. The over all profit also increases for the system. In such cases, there may not be any explicit understanding between the service providers initially but services evolve in a complementary manner due to their economic interest in a game theory framework.

2. Coordination Driven
The integration may be driven by one or more service providers as their benefits are much higher from others. As Table below illustrates, under certain assumptions of cost and revenue pre and post integration, one player may be able to get higher benefit and may even be ready to share with another player, who is either in a worse or status-co situation. In the given case, Player 1 may take the lead to share a part of the profit with the other players post integration. This integration is possible by forming a coordinating committee, where player 1 takes the lead.

	Before Integration			After Integration
	Player 1	Player 2	Total	Player 1	Player 2	Total
Revenue	1100	600	1700	1254	654	1908
Cost	1000	500	1500	1100	545	1645
Profit	100	100	200	154	109	263
% Profit	10%	20%	13%	14%	20%	16%

Source: Idea adopted from NEA et al., 2003

The committee may be constituted with high level authorities from various service providing firms, who wish to integrate their services. The formation of committee creates avenues for formal discussion between various service providers to arrive at service parameters and formula for sharing revenue. This allows each of the service providers to have their individual freedom to a large extent.

3. Government Driven

There can be cases where no player has enough incentive for integration. The marginal advantage from integration is just enough to compensate the loss of other players. Table below depicts a case, where the benefit to player 1 is just enough to share with player 2. In this case none of the players have any apparent incentive to initiate the process of integration given the initial hassles that may come across.

	Before Integration			After Integration
	Player 1	Player 2	Total	Player 1	Player 2	Total
Revenue	1100	550	1650	1221	594	1815
Cost	1000	500	1500	1100	550	1650
Profit	100	50	150	121	44	165
% Profit	10%	10%	10%	11%	8%	10%

Source: Adopted from NEA et al., 2003

Table below shows a more realistic picture for public transport firms i.e. most of them are having operational losses. In this case, players have little soft budget constraints and hence little incentive to perform better.

	Before Integration			After Integration
	Player 1	Player 2	Total	Player 1	Player 2	Total
Revenue	500	300	800	575	324	899
Cost	1000	500	1500	1080	525	1605
Profit	-500	-200	-700	-505	-201	-706
% Profit	-50%	-40%	-47%	-47%	-38%	-44%

Source: Adopted from NEA et al., 2003

This type of integration instrument must be driven by the government. Regulatory board or authority may be an instrument to arrive at an integrated service through government intervention. Regulatory board/authority would be binding on all the service providers as a result of which this entity may also curb some of the freedoms of the individual players.

In this case, a planned transport development can be carried out. Also, this allows implementing competitive transport services and attracting private sector funding. Even urban and land use planning, and development can be linked with transport development for a sustainable transport within the scope of this instrument.


Concluding Remarks
The realities of the state of transport in India is depicted through the last table discussed under government initiative. Hence, to me, integration can only be achieved through government initiative. However, creating a rule or an organization may not be enough as discussed in the earlier blog on 'National policy on urban street vendors and its effect'. The organization/rules need to be supported by modification in the existing rules and rights of organizations.

Frequency of blog writting

A new blog will appear every alternate Monday. I would prefer to receive comments below the blog itself rather than in my mail box. Hope you have a good time reading.

Satyam Shivam Sundaram

National Policy on Urban Street Vendors and its Effect

There are large number informal markets in the developing countries. In India, most of the larger cities (Mumbai, Delhi, Kolkata, Bangalore, Ahmedabad, Patna etc) have thousands of people working in the informal market in different occupations. One such occupation is street vending or hawking (In strict sense, vendors are those who stick to a place and sell while hawkers are those who move from one place to other for selling. Hawkers are also called peddler or packman). Hereafter, I am using the word vendor for both vendors and hawkers, since the National Policy on Urban Street Vendors (2004) refers to both of them as vendors.

According to an estimate, Mumbai has approximately 250,000 vendors and thus supports the largest number of street vendors, while Delhi, Kolkata, and Ahmedabad have approximately 200,000, 150,000, and 100,000 vendors (National Policy on Urban Street Vendors, 2004). Most of these vendors in Kolkata and Ahmedabad were previously working as laborers in various industries (which closed over the time) in these cities. Vendors often face the threat of being dislocated and their articles confiscated by the city administration, in most part of the country, while earning their livelihood on the urban roads. I am making an effort to understand the importance of the national policy on street vendors in resolving their problems in this blog.

Vendors play an import role in urban sustainability. They provide products/articles at a lower cost to the lower and middle income group. Vendors help people reduce their expenditure also by facilitating purchase of articles, while they are on their way back home or they are exercising a trip for other purposes. In the absence of these vendors, lower and middle class will find it very difficult to sustain their livelihood in urban areas. This will have other implications on the whole equilibrium of an urban society. The absence of vendors will also mean reduction in the availability of manual labor in an urban area, as some of their family members also provide the labor forces for upper income group. Hence, vendors are an integral part of the urban society. They not only earn their livelihood from hawking but also help the lower and middle income group families sustain their lives in the urban areas.

On the negative side, vendors occupy the sides of the road and thus block the pedestrian pathway, if any and sometimes even a part of the road. Thus, they reduce the road capacity by attracting crowd, who come to purchase/glance, towards their articles. This adds to the existing problems of urban transport. Sometimes, these vendors establish permanent shops on unauthorized land or road side creating a challenge for the urban authorities. They also litter the place with disposed articles. Due to these reasons, various government agencies always try to remove them from the urban street. Hence, urban vendors are on one hand beneficial for the society and on the other create nuisance as well.

To understand the importance of the National Policy on Urban Street Vendors in resolving the issues that arise in the urban society, first the issues related to urban vendors need to be understood. The cases involving vendors, heard in the Supreme Court of India and various High Courts have been used to understand the issues related to them. These cases also help us understand and interpret the constitutional obligation of the government towards them (which may change over the years). Thereafter, the draft policy has been analyzed to see how these issues have been dealt with. The final step is to understand the gaps that still remain to be bridged to solve the problem fully.


Let us understand the constitutional obligations of the state towards the people of India and their rights as provided by the Constitution of India.

Article 14 (Equality before law): The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.

Article 19(1)(g): All citizens shall have the right to practice any profession, or to carry on any occupation, trade or business.

Article 19(6): Nothing in sub-clause (g) of the said clause [19(1)(g)] shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the said sub-clause, and, in particular, nothing in the said sub-clause shall affect the operation of any existing law in so far as it relates to, or prevent the State from making any law relating to (i)the professional or technical qualifications necessary for practicing any profession or carrying on any occupation, trade or business, or (ii)the carrying on by the State, or by a corporation owned or controlled by the State, of any trade, business, industry or service, whether to the exclusion, complete or partial, of citizens or otherwise.

Article 21(Protection of life and personal liberty): No person shall be deprived of his life or personal liberty except according to procedure established by law.

Apart from the above mentioned articles, directive principles of the state policy in the schedule IV of the constitution provides guidelines for the state towards the people of India.

The cases, heard by the Supreme Court of India and the various High Courts of India which are discussed here, only relate to the fundamental questions raised and the explanations given by the Courts. The cases have been used to synthesize the issues that vendors are facing in India. I refrain from going into the details of each case and discussing the specific facts of each case.

Sodan Singh and Others vs. New Delhi Municipal Committee and Others (1989 Indlaw SC 213):

The fundamental question that was addressed by the Supreme Court of India, in this case, was whether the rights provided in Article 19(1)(g) and Article 21 of the constitution be restricted by the government under the Article 19(6) of the constitution.

The Court held that vendors have the right to carry out their business for their livelihood on the road sides, as long as they do not interfere with the rights of other people. This means that their rights to carry out road side business can be reasonably restricted depending on the utilization of the road or any other area. Vendors can not ask for a fundamental right to occupy any place permanently and they can only have temporary arrangements without disrupting others. The primary objective of the road is movement of person and goods between two points through some medium. This means that in the current scenario the police can use this judgment to harass the vendors so long as no fixed arrangements are made by the government or the local body.

From the case it can be suggested that the draft policy should provide a reasonable space for the vendors for carrying out their business or help them establish alternate medium for their livelihood.

Olga Tellis and Others Vs Bombay Municipal Corporation and Others (1985 Indlaw SC 161)

This case pertains to slum dwellers. The judgment again held that slum dwellers have no right to erect permanent structure on the road side and they can be removed by the government body. However, under the Article 21 of the constitution, government was asked to make alternative arrangements for these slum dwellers before they are removed. It was recognized that the local body and the government needs to provide them alternate rehabilitation. This case does not directly deal with the rights of the vendors, but the guidelines provided by the courts are also useful for the rights of the vendors.

This case has pointed out making alternate arrangement is as much a duty of the government as much as their removal for the benefit of some other urban population.

Bombay Hawkers' Union and Others Vs Bombay Municipal Corporation and Others (1985 Indlaw SC 191)

In this case the Supreme Court of India provided certain guidelines for the government as well as vendors. Vendors were restricted from creating any permanent structure and were expected to cooperate with the municipal corporation in keeping the roads clean. The government was advised to create hawking zones to avoid discomfort to the other users of the road as well as the vendors.

Municipal Corporation of Delhi Vs Gurnam Kaur (1988 Indlaw SC 703)

The court ordered against the vendors in this case by saying that there was no threat to their life by the removal of their stall in this particular case. However the honorable court went a step further in suggesting that hawkers’ and non hawkers’ zone may be created to avoid this forceful squattering for the vendors. It was suggested that such a move will be able to achieve twin objective of cleaner city and will also reduce the congestion on the road.

Gulamali Gulamnabi Shaik Vs Municipal Commissioner (1986 GLH 616)

The Supreme Court directed the government to frame rules and regulations for vendors for providing them license and space for carrying out their business. This was done to avoid harassment and trouble for vendors. This also provided neater and clear city to other road users.

From the above cases, following issues emerge: (i) Regulation regarding the place where business can be carried out, (ii) Regulation regarding the articles that can be sold by the vendors, (iii) Regulations and procedures regarding eviction of vendors, (iv) Issues of extortion, bribery and harassment of street vendors, and (v)Issues of relocation and rehabilitation

Resolving these issues will help the primary users of the road by proving them cleaner and less crowded roads and at the same time reducing the hassles for vendors.

The National Policy on Urban Street Vendors addresses most of the issues raised earlier and provides a few guidelines. The policy was drafted to provide and promote a supportive environment for earning livelihoods to the street vendors as well as ensure absence of congestion and maintenance of hygiene in public spaces and streets (National Policy on Urban Street Vendors, 2004). The specific sections of this policy is highlighted to understand how these would resolve the issues related to vendors.

The policy has aimed to provide vendors a legal status and to allow them carry out their business in the designated areas. These designated areas are to be called hawkers’ zones and non hawkers’ zones. These zones need to become a part of the planning process (section 4.1.1 of the policy).

The guideline suggests that enough space should be designated for vendors’ at least to the extent of 2% to 2.5 % of the total city population (section 4.2.1 of the policy). The guideline also provides the flexibility to the city with regard to exact norms.

Vendors are also expected to register and should be monitored by the town vending committee/ward vending committee (section 4.1.1). Participation of vendors in the town vending committee/ward vending committee should be ensured. This will help reduce their harassment.

The policy also provides guidelines for relocation and rehabilitation of vendors. Vendors are to be assisted and any loss of assets should be avoided as a part of rehabilitation process.

The policy guideline has also tried to address the issue of confiscation under section 5 where guidelines have been provided to safe guard the interests of the vendors. There is a clear indication that eviction should be the last resort and reasonable time should be given for relocation. They should also be assisted in establishing their business in a new place. Section 8 discusses the insurance and financial problems of the vendors. For financing, NABARD and SJSRY scheme has been indicated in the policy. But the policy fails to recognize that these polices have a limited resources and they may not be concentrating on vendors, thereby making it a promise that will never get executed. For insurance, there is little in the policy. A lot has been left to self help groups and NGOs. This is another area where a structured long term solution needs to be worked out. The policy also talks about the need for changing the sections of IPC and municipal acts so enable the guidelines effectively. However, the guidelines do not talk about any framework or the time period for modification and leaves it open for the states to take any action in this regard.

Thus the guideline addresses most of the issues raised over the years and should have been able to change the status of the street vendors to some extent. However, the guideline has not spelt a framework for enacting some of their guidelines. This failure has been the primary reason for the negligible change over the two years in any part of the country.

Plossible Reasons for Failure

Even after the guidelines provided by the ‘National Policy on Street Vendors’, there has been little change in the status of vendors over the years. A part of the reason could be the policy itself. The policy discusses a lot of things regarding allocating of land, legalization of profession and registration. But the policy has not indicated a time frame or a road map for the same. There is a discussion for the change in the laws related to local bodies and Police Act of various states and sections 283 (Danger or obstruction in public way or line of navigation: Whoever, by doing any act, or by omitting to take order with any property in his possession or under his charge, causes danger, obstruction or injury to any person in any public way or public line of navigation, shall be punished with fine which may extend to two hundred rupees) and 431 (Mischief by injury to public road, bridge, river or channel: Whoever commits mischief by doing any act which renders or which he knows to be likely to render any public road, bridge, navigable river or navigable channel, natural or artificial, impassable or less safe for traveling or conveying property, shall be punished with imprisonment of either description for a term which may extend to five years, or with fine, or with both) of IPC. However, till date nothing much has been done in this direction i.e. these have not been amended.

Section 283 and Section 431 of IPC provides administration a lethal weapon to use against the vendors. Using these acts, police is able to extract money from the vendors and trouble them. These acts need to be modified as also stated in the policy. Until then, the policy formulated for vendors may not be effective in reducing the harassment for the urban poor. However, while amending the laws, enough precautions need to be taken so that no one should be able to use it to create larger problems for a society. A time frame should be fixed for the changes.

Different urban local bodies (e.g. municipal corporations and urban development authorities) have various laws which are currently used against the vendors. These laws also need to be amended to make the national policy on vendors an effective one. Some of these laws are discussed here.

(i) Ahmedabad Municipal Corporation
Ahmedabad municipal corporation laws allow the arrest of vendors for obstructing the traffic without warrant. They are liable to be fined. The act also does not allow any hawking of goods without a proper license from Ahmedabad Municipal Corporation. There property can also be removed immediately.

Thus this act allows enough power to the city police and municipal administration. Until such acts are modified the national policy can not be effective. The modification in the act should be carried out along with policy intervention at the local government level to establish a hawkers’ zone and safeguard the interest of the primary users of the road. Registration process should be made simple so that they are encouraged to register.

(ii) Bangalore
Bangalore bylaws have some relief for the vendors. It recognizes the need for identifying separate area for vending and also has provisions for allowing street vending without making the place dirty on certain identified streets. However, there are also regulations regarding the movement of vendors around free spaces and park more driven by need for cleanliness rather than obstruction.

(iii) Bhubaneshwar
Orissa municipality act, 1950 allows for public market at designated places with a fee being paid to the municipality. All participants need to have a license and it can be canceled by the municipality if they find that the particular vendor has not been functioning in accordance with the regulations. Thus, hawkers here have some legal rights. However the registration process needs to be made smooth and less complicated.

(iv) Kolkata
Calcutta municipality act does not allow any hawking activity near any road or free area. Their articles can be seized immediately and the person can be detained. This is surprising, given that a communist government has been in power for a long time in West Bengal.

A few times hawkers have been evicted forcefully confiscating their articles in the past. Quite a few of these hawkers are the previous manual workers of the industries in and around Kolkata which have shut down over the years. Thus, it is the only livelihood for them. The government laws only allow the administration to harass the vendors and extract some illegal money. Thus this law also needs to be modified accordingly.

(v) Mumbai
Municipal Corporation of Mumbai allows for hawking activities with permission and under license from municipality. However, it has been found that there are very few vendors who are registered with Corporation. Most of them run their hawking activities illegally by paying bribe to the local police officers because of the complexities related with registration process. The municipality does not allow for permanent structure even to the licensed persons.

(vi) Patna
The Patna Municipal Corporation Act is also similar to the other acts discussed above. It does not allow any goods to be sold on the road without prior permission of the municipality in the form of a license. Any person obstructing the traffic and any other movement may be arrested without warrant and fined, if found guilty. Thus, this act can be used to harass the vendors and is used to extract money from them illegally. There is a need to modify this act to make it little friendlier for the vendors

My Final Remark
As seen from the various acts that exit in different parts of the country, it is possible to harass the vendors and extract money from them. It is also possible to evict them from the road side without prior notice. In some places, their goods can be confiscated. Thus, just having a National Policy on Vendors will not serve the purpose. As the other local body acts, IPC sections and Police acts can be used against the vendors. There is a need to modify these acts so as to make the National Policy effective.

At a more abstract level, one of the biggest problems in India that I perceive is that new laws/regulations are formed but the laws/regulations in other areas which affect the ensuing law/regulations are not repealed. It is the same story with creation of new organizations to plan/implement a particular task. As a consequence of which, the bureaucracy keeps increasing rather than a reduction in the same as the activities have to pass through all the organization that existed for the purpose earlier as well as the new organization in some form or the other.