The Indian Railway II

What Went Right?

The Railway was a failure when it was a monopoly. Now it has competition from trucks plying the recently built highways. So they had to shape up to survive. The Government owned airlines are struggling due to competition from the newly licensed private carriers. The Indian Airlines (the domestic airline) has already been folded into Air India. So why did the Railway thrive under competition and not IA?

The Railway Minister, a shrewd but comical character named Laloo Prasad Yadav is not shy about taking credit. He has been making the rounds, even at the Harvard Business School, lecturing in his broken English. I can already imagine the book: The Management Secrets of Laloo Yadav. One of the things Laloo did was to make sure that the Railways are not cheated out of the proper fare for carrying freight. He allowed longer freight trains, carrying more goods per train.

Laloo was uniquely qualified to root out the corruption, being himself an expert at milking Government schemes. A man of the people, the kind of politician who can disarm anyone with his antics and cajole them into doing his bidding. He also is one of the funniest people in Indian politics.

Despite his charm and guile, it is hard to believe that Laloo turned around the Indian Railways all by himself. Having seen the operation up close, I believe that the success was built one nail at a time by its one and a half million employees.

In the first years after independence, the Railway, like India itself, was weighed down by a couple of centuries of exploitation. The iron for making tracks was diverted to the war effort. The mechanical shops were forced to make guns instead of fixing the trains. Almost half the stock went to Pakistan. What was left did not fit well together. In some places, freight had to be unloaded and reloaded by hand because the track changed gauges (distance between rails.)

The commercial operation was an afterthought. Instead of focusing on improving freight transport, the source of most of the revenue, managers had to work on repairing and maintaining the stock. Bit by bit, the kinks in the system were worked out. For example, a stretch I used to travel ran on “meter gauge” instead of “broad gauge” ( 5′ 6”) as in most of the rest of the country. Replacing it with broad gauge, the national standard, was a big event for us in the seventies . It meant that you could travel to Delhi without switching trains, in only three days.

A few years later the same lines were doubled, so that a train would not have to wait at a station to let another in the opposite direction pass. Then the track was electrified. Each step took several years, and many more in planning. There were interminable arguments with local farmers whose land had to be acquired. Negotiations with union bosses, the construction of bridges and tunnels. As I grew up and each year I went back after I left, I would see the slow but steady progress.

What I saw in Kerala was also happening, at an even larger scale, in the rest of the country. Now the babus (managers) can allow longer trains carrying more freight, because the track can take the extra weight. There is no need for freight to be unloaded and loaded at depots just because the train tracks have different gauges.

This is the unglamorous work of building infrastructure. Just what the WPA did for the US during the depression years. There is no six-sigma management principle at work here. Laloo is a charming man, but he could not have boosted the allowed freight load if the track had not been rebuilt. Each place where the goods were unloaded and reloaded was a bottleneck and a source of corruption. Laloo would have been on the other side of that operation in the old system.

In the nineteen thirties, my grandfather was a “Gang Man”, the lowest level (Class IV) employee. His job was to walk down the track and bang the nails back into their slots after the day’s trains passed by. His son, my father, was two levels higher, a proud Permanent Way Inspector. (Class III.) My other grandfather had the job of pumping water for steam engines into the water tower by hand: there was no electricity. An uncle had the most exciting job of all: fireman. In the unbearable heat of the steam engine, he would shovel coal into the mesmerizing fire.

The steam locomotives are long gone, replaced by air conditioned electric and diesel engines. My father’s brother started on steam engines, but rose to the highest grade driver. Express trains pulled by Diesel-Electric engines. The railway workers are still a hard working bunch. Down to Earth people who have the satisfaction of seeing the point of their daily toil. They don’t need a spreadsheet to tell them they are adding value.

It is the co-operative work of intelligent human beings that creates real wealth. Even if it takes some years for the system to work out its kinks, as long as you don’t betray the baseline worker, things will turn around.

Several of my Indian friends and students are children of people who used to work for the Railway as well, at much higher levels than my father. Yet they were not Princes of the Realm. I did not have the same opportunities as them, but what I had was good enough. It is true that the General Manager (Class I) of Southern Railways traveled in style-a whole compartment to himself- when he came by on his annual inspection of the Trivandrum Division. But his son sat for the National Science Talent Search Exam same as me. He paid into the same Provident Fund and received a pension from the Government the same as my father.

At General Motors the assembly line employees were handsomely paid, certainly better than Indian laborers. The managers lived in another planet altogether. They were potentates, more comparable to the Maharajas of old. They strutted about the world as titans, buying Saab one day, lecturing the President of the United States on another. It would have been alright if they traveled in a specially made Oldsmobile. But their time was too valuable: they were entitled to corporate jets. They did not just pay tuition so their children can go to better schools. They were able to buy (endow) entire schools. Like the Sloan School of Management. They did not rely on a pension, but bailed out on golden parachutes worth many millions. Instead of putting profits back into rebuilding infra-structure and R&D, they looted the company coffers. All legal.

The counterparts of my relatives who worked in Flint and Pontiac are out of work now. GM may even have to shutter Saturn, its last best hope. And it is not just GM. Greedy managers and criminal accountants have gutted American manufacturing. It is a strange economy where everyone is a pencil pusher.

To anyone who grew up in the seventies, the world has turned upside down. It can turn again. It is not a time to swagger. For anyone.

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