New Delhi: Leading industry bodies and trade associations on February 26 welcomed the Rail Budget saying steps like freight rates rationalisation, tariff reclassification and reduced "to pay" surcharge would improve traffic volume, freight earnings and increase price efficiency of railways.

Stating that it was an attempt to make the railways market-oriented, Federation of Indian Chamber of Commerce and Industries (FICCI) president A C Muthiah said, "The heartening feature of the Railway Budget is the new philosophy of going to the market."

He said the Railway Minister Nitish Kumar has attempted to make the railway genuinely market-oriented by addressing the basic problem of traffic diversion from railway network to roads, a FICCI statement said.

Welcoming proposals including rationalisation of freight structure, tariff classification from 32 to 27, reduction in "to pay" surcharge and rationalisation of the ratio between freight rates for the highest and lowest class, Muthiah said, "This will increase price efficiency of the railways and also lead to greater volume of traffic."

Expressing similar sentiments, Confederation of Indian Industry (CII) president Ashok Soota described it as a rational and balanced Railway Budget.

He said the minister has taken a number of positive and visionary steps, particularly focussing on safety and rationalisation of freight structure, reclassification of categories and introduction of new trains, a statement said.

However, ASSOCHAM in a statement termed the Budget proposals as "populist" one and a "missed opportunity" for improving rail finances by removing the cross subsidisation on account of high freight rates and low passenger fares.

PTI