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Indian Economic Policy

Notes (i) First Plan : rehabilitation and replacement of over-aged assets;
(ii) Second Plan : particular emphasis to prepare the Railways for carrying the traffic generated by
the new steel plants and the increased production of coal;
(iii) Third Plan : Building up additional capacity so as to be ahead of the traffic demand and to
prevent bottlenecks;
(iv) Fourth Plan to Seventh Plan : Modernisation of the system to improve efficiency of operations;
and high priority to the development of freight terminals to facilitate the free and smooth
movement of wagons; accelerate the conversion of steam locomotives to diesel and electric
traction.
(v) Eighth and Ninth Plans : The main thrust was on capacity generation, man-power planning
and energy conservation, safety, and customer satisfaction through reliable and better quality
of services.
(vi) Tenth Plan : The Tenth Plan (2002-07) emphasized, as under previous plans, capacity expansion
through modernization and technological upgradation of the railway system, improvement in
quality of service, rationalization of tariff and improvement in safety and reliability of railway
services.
During the first three years of the Tenth Plan, the Indian Railways were in a bad shape. But there was
a spectacular increase in productivity in the last two years of the Tenth Plan which resulted in quantum
expansion in capacity augmentation, increase in railway receipts, control of railway expenditure and
huge surpluses.
Roads and Road Transport System in India
Importance of Road Transport for the Indian Economy

As compared to the railways, the road transport system has definite advantages :
(i) Motor transport as well as road construction have contributed significantly to the growth of the
gross national product all over the world, but India has remained significantly backward in
this regard. Besides, there is tremendous scope for creating employment through road
construction and maintenance. Further, India needs increased road mileage, specially to open
up the vast areas which cannot be reached except through roads.
(ii) Road transport is quicker, more convenient and more flexible. It is particularly good for short
distance travel as well as for movement of goods. Motor vehicles can easily collect passengers
and goods from anywhere and take them to wherever they want to be dropped. Door-to-door
collection and delivery are possible in the case of road transport. But in the case of railways, the
lines are fixed and the railways do not have the flexibility of the roadways. Passengers and
goods will have to be taken to the railway station.
(iii) Roads are a necessary complement to railways. India is a country of villages and it is only roads
which can connect villages; Railways can connect towns. The railway stations will have to be
properly served by a network of feeder roads. Only through these roads the railways can receive
their passengers and goods. If railways are essential for the movement of goods and people for
long distances, road transport is essential for such movement for short distances. Roads and
railways are, therefore, not competitive but are complementary.
(iv) Road transport is of particular advantage to the farmers. Good roads help the farmers to move
their produce, particularly the perishable products, like vegetables, quickly to the mandis and
towns. Only by developing the road system, the farmer can be assured of a steady market for
his products. This assumes great importance in the context ot the green revolution. Besides,
good roads reduce the strain on the draught animals During the monsoon season, it may be
impossible for the villagers to move out of their villages unless there are good roads. In this
connection, it is important to recognise that it is the road system which brings the villagers into
contact with the towns and the new ideas and the new system which emanate from the towns.
(v) Roads are highly significant for the defence of the country. We have explained earlier that in a
vast country like India, it is necessary that the troops should be moved quickly from one place

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