Pricing the Metro tickets low is ridiculous; is it a social service effort?
18 Sep-1 Oct ‘09 issue
Is Delhi Metro a costly mistake? Well, it surely will become a national heritage once it gets completed, but would it qualify on the strictest parameter of becoming a financially sound public transport model? Or has it been set up just to beautify Delhi’s landscape on taxpayers’ money? Let’s see some interesting facts.
The concept of metros has never been a profitable business proposition internationally. There are 135 metros worldwide but only four metros have been successful in making profits. These are Hong Kong, Taipei, Singapore and Tokyo. The Kolkata Metro is another example of a staid loss maker. If the financial year 2004-05 saw it incurring losses of Rs.43 crores, last year stood at Rs 48.6 crores (It earned Rs.48 crore from passenger traffic against operating costs of around Rs.91 crore in the same year). In other words, tax payers are paying for the inefficiencies of metro’s employees and processes. The Delhi Metro railway project is purportedly one of Delhi’s brightest projects. The first phase of Delhi metro is complete and the total cost stood at around Rs.10,571 crore. The estimated cost of the second phase is Rs.8,118 crore. In spite of having the lowest fares compared to other metros internationally, Delhi metro has earned operational profits of Rs.398.69 crore. Since there is hefty capital investment and certain amount of operating cost involved, it seems that it will take many years to make net profit.
Claude Jeanrenaud, Council of Europe member, writes in his report, Funding of Urban Public Transport, “Urban public transport systems are systematically loss making,” the reason clearly being pricing travel tickets lower than true cost in an ostensible effort to cater to lower income groups, a clearly misdirected strategy at the cost of other taxpayers. Delhi Metro was not and should not be considered a social service effort, especially when it is not free money that is going in. It’s time to price its tickets higher; ruthlessly!
18 Sep-1 Oct ‘09 issue
Is Delhi Metro a costly mistake? Well, it surely will become a national heritage once it gets completed, but would it qualify on the strictest parameter of becoming a financially sound public transport model? Or has it been set up just to beautify Delhi’s landscape on taxpayers’ money? Let’s see some interesting facts.
The concept of metros has never been a profitable business proposition internationally. There are 135 metros worldwide but only four metros have been successful in making profits. These are Hong Kong, Taipei, Singapore and Tokyo. The Kolkata Metro is another example of a staid loss maker. If the financial year 2004-05 saw it incurring losses of Rs.43 crores, last year stood at Rs 48.6 crores (It earned Rs.48 crore from passenger traffic against operating costs of around Rs.91 crore in the same year). In other words, tax payers are paying for the inefficiencies of metro’s employees and processes. The Delhi Metro railway project is purportedly one of Delhi’s brightest projects. The first phase of Delhi metro is complete and the total cost stood at around Rs.10,571 crore. The estimated cost of the second phase is Rs.8,118 crore. In spite of having the lowest fares compared to other metros internationally, Delhi metro has earned operational profits of Rs.398.69 crore. Since there is hefty capital investment and certain amount of operating cost involved, it seems that it will take many years to make net profit.
Claude Jeanrenaud, Council of Europe member, writes in his report, Funding of Urban Public Transport, “Urban public transport systems are systematically loss making,” the reason clearly being pricing travel tickets lower than true cost in an ostensible effort to cater to lower income groups, a clearly misdirected strategy at the cost of other taxpayers. Delhi Metro was not and should not be considered a social service effort, especially when it is not free money that is going in. It’s time to price its tickets higher; ruthlessly!
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relatively speaking, they are better for brand or awareness advertising. Unlike search, where people go to a site like Google or Yahoo! to click away and go somewhere else, social networks are immersive and users tend not to click on ads here. So don’t expect a high click-through rate on ads on social networks. Social networks can hence be better used for general demographically or behaviourally targeted brand messaging.
media is more useful for brand building. He believes that unlike search advertising, where people go to a site like Google to click and go somewhere else, social networks are immersive and users tend not to click on ads here. So, while you may not expect a high click-through rate for banner ads on social networks, some like NIIT have found more effective ways to build their brand here. Preeti Technani, the virtual character created by NIIT on Orkut, answers daily queries related to careers and has been a huge success so far. But there are still many that are missing from the social networking buzz. Analysts blame it on the lack of education and evangelising. “Only a few understand the big picture,” laments Hegde, adding that the ‘hit now, score now’ syndrome – a throwback to the conventional advertising era – is prevalent among marketers. In contrast, “social media marketing is a slow but sure burner,” he says.
a stepping stone, it’s a mistake.” And the underlying message, it seems, has been well received by the Indian retailers!?? No doubt, the Indian organised retail has gained tremendous momentum in the last couple of years, (pegged to touch $450 billion by 2015 & be amongst the top 10 retail markets in the world, by McKinsey & Co.), but, in the transition they have also made several mistakes. All thanks to their efforts to outdo each other in the game of one-upmanship.
however, most cars don’t have turbochargers and nitros! But you do, so before you ram headfirst into a concrete divider at 200 kmph, it’s better to have disc brakes installed on all four tyres. As for the sports clutch, this little baby will ensure that a mere tap of the clutch pedal will change the gears for you, saving you those precious seconds in a tight race.
who now sits snuggly at the No. 5 spot. Honda has to move quickly and deliver great new products much before its rivals, something unlike the Honda Civic introduction which happened in 1972, six years after its closest rival, the Toyota Corolla. (For the records, the Corolla is the world’s largest selling car!) Even hybrids which are the latest trend were not spared from the ill-effects of the ‘casual’ Honda pathogen. The company spent too much time (and money) in studying the hybrid market, thus giving competitors time to establish themselves. The Toyota Prius sells an enviable number because it was launched almost two years before Honda launched the Insight in 1999 and FCX sometime later. And sadly, even today, the FCX has not been able to establish itself as a viable hybrid, especially because of poor hydrogen infrastructure.
generates about 146,000 tonnes of eWaste annually and the domestic eWaste is expected to touch a staggering figure of 1,600,000 tonnes by 2012. The metals contribute to over 60% of the total eWaste volume, while pollutants contribute to 2.7%. These pollutants are highly toxic when burnt or recycled in uncontrolled environments and exposure to these materials damage the nervous systems, kidney, bones and reproductive systems. And the situation is nowhere close to improving as a 2008 Greenpeace study proves. In the survey, 9 out of 20 brands tested for their take back practice in India have ‘no take back’ service. Imparting awareness in eWaste and to make take-back centre accessible is therefore the need of the hour.
friendly, meet the CCXR. This 1000 bhp super car is designed to run on biofuel while developing 20% more power than its gasoline brethren.
economic monsters, the debate continues. For the uninitiated, a SWF is a government-owned investment fund, which invests in all kinds of assets.They presently account for 2% of the world’s $165 trillion of traded assets. Politicians & governments of many countries fear that the investment objectives of SWFs are more politically driven rather than commercially inclined. After having infused around $70 billion in US financial institutions suffering from the subprime fiasco, resource firms seems to be their new found love. The almost moribund state of the financial institutions in which the sovereign wealth funds invested have made their investments unproductive. The China Investment Corporation (CIC), a Chinese sovereign wealth fund, faced severe criticism in Beijing because of its investment in the private equity firm, Blackstone Group LP. In June 2007, China acquired 9.9% stake of Blackstone for $3 billion. This 9.9% stake is currently worth only $2 billion, with 33% value eroded over the past one year. US politicians are also raising hue and cry. US Republican Congressman, Thaddeus McCotter, describes SWFs as a threat to economic liberty. However, Sherman Chen, Economist, Moody’s Economy.com counters, “The recent shift in investment preferences reflecting shifting economic outlook lends weight to the assertion that SWF investments aren’t driven by poltical purposes, but purely commercial ones.”
Qantas flight QS 648 is about to make a safe landing,” (hopefully)! Hope is a powerful emotion, albeit one that Qantas passengers hardly identified with, until last week that is, thanks to the airlines hugely impressive safety record. But three mid-air dramas have been a bit too much for passengers to take. Qantas is going through some turbulence in an already weakening climate for the aviation industry. By its good fortune, the airlines’ ‘no casualty’ record is still intact. Unfortunately, on the other hand, the environment in the aviation sector doesn’t meet that benchmark by miles!