industry update

The Indian Railways kitchen seems to have the perfect recipe to ensure quandary. The Railway Board, in what seems to be a hurried decision, has taken away the catering rights from the Indian Railways Catering and Tourism Corporation Ltd. The IRCTC is the caterer for a majority of trains, including Rajdhani and Shatabdi expresses. The Board has shown a disturbing jiffy to write off the profit making PSU.

The decision has been taken by the Railway Board citing reasons like complaints about the quality of food and services by the IRCTC and the recent losses incurred on catering deals in Rajdhani and Shatabdi trains. The Board has decided that food would hence be provided by its vendors and not the IRCTC . The Railway Board direction on July 21 states clearly that catering rights will be taken away from the IRCTC within three months of the meeting and gradually online booking of tickets, another major responsibility handled by the IRCTC, will also be handed over to the Board's own subsidiary enterprise, Cris. Which means that the IRCTC will be left with tourism related responsibilities and maintaining some Food Plazas at railway stations under the surveillance of the Board.

Although, in a recent development, departmental catering in Rajdhani, Shatabdi and Duranto trains has been given back to the IRCTC.

The issue is, the Railway Board cannot erect an infrastructure providing catering facilities to millions of passengers within three months. It cannot by any means. Also, the Railways do not have base kitchens and vendors in place ensuring catering facilities in trains.

The decision seems unjustified as the IRCTC seems to be a profit making PSU with a turnover of around Rs 725 crore in the year 2009-2010 and Rs 618 crore during 2008-2009. The IRCTC has also been winning ten awards almost every year since its inception in 2000 for its quality service and excellence.