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Indian Railways' FY22 operating ratio: 107.39%
RAILWAYS & METRO RAIL

Indian Railways' FY22 operating ratio: 107.39%

The latest Comptroller and Auditor General (CAG) report has brought to light Indian Railways' financial performance for the fiscal year 2021-22, revealing an operating ratio of 107.39%. This figure, which represents the ratio of working expenses to traffic earnings, signifies a decreased capacity to generate a surplus. The report, presented in Parliament, offers an analytical overview of Indian Railways' finances and accounts, using the audited accounts for the year ended March 31, 2022.

The CAG's report highlights a loss of  $682.69 billion across all classes of passenger services in the fiscal year 2021-22. However, the auditor pointed out that this loss demonstrated a reduction compared to the previous year.

Notably, the entire profit of $391.96 billion garnered from freight traffic was allocated to cross-subsidize and compensate for the losses incurred through passenger and other coaching services. During 2021-22, the passenger operations' loss of $320.73 billion remained uncovered, according to the report.

The CAG's report underlines that the operating ratio of 107.39% in FY22 marks a significant increase from the 97.45% recorded in the previous fiscal year, indicating a diminished ability to generate surplus. This inability to generate net surplus during 2021-22 contrasts with the performance in 2020-21, where the operating ratio was 97.45%.

The report sheds light on the financial challenges faced by Indian Railways, particularly in the context of passenger services. The operating ratio serves as a key indicator of the railways' financial health, and the upward trend raises concerns about its ability to effectively manage expenses and generate revenues.

The latest Comptroller and Auditor General (CAG) report has brought to light Indian Railways' financial performance for the fiscal year 2021-22, revealing an operating ratio of 107.39%. This figure, which represents the ratio of working expenses to traffic earnings, signifies a decreased capacity to generate a surplus. The report, presented in Parliament, offers an analytical overview of Indian Railways' finances and accounts, using the audited accounts for the year ended March 31, 2022.The CAG's report highlights a loss of  $682.69 billion across all classes of passenger services in the fiscal year 2021-22. However, the auditor pointed out that this loss demonstrated a reduction compared to the previous year.Notably, the entire profit of $391.96 billion garnered from freight traffic was allocated to cross-subsidize and compensate for the losses incurred through passenger and other coaching services. During 2021-22, the passenger operations' loss of $320.73 billion remained uncovered, according to the report.The CAG's report underlines that the operating ratio of 107.39% in FY22 marks a significant increase from the 97.45% recorded in the previous fiscal year, indicating a diminished ability to generate surplus. This inability to generate net surplus during 2021-22 contrasts with the performance in 2020-21, where the operating ratio was 97.45%.The report sheds light on the financial challenges faced by Indian Railways, particularly in the context of passenger services. The operating ratio serves as a key indicator of the railways' financial health, and the upward trend raises concerns about its ability to effectively manage expenses and generate revenues.

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