Effects:

♤ Over utilization of existing infrastructure, which causes faster wear and tear.

♤ Frequent rail accidents mostly caused by derailment and at level crossings leading to death of innocent persons.

♤ Cross subsidization: Passenger fares are not revised while freight charges are increased to recover cost. This has resulted in shifting of the traffic to other transportation system.

♤ High operating cost: It means that railways have to spend more to earn less.

♤ Increase environmental pollution as Railways are less polluting than road transport in terms of per capita goods/passengers.

♤ Anil Kakodkar committee was appointed in 2011 for reviewing the rail safety issues and recommend improvements. Committee observed key issues: poor financial condition, inadequate performance and lack of autonomy at functional level.