Will food served on trains become costlier after rise in Petrol and Diesel prices?

The Indian Railway Mobile Caterers Association (IRMCA), in its letter, has said that IRCTC had fixed the prices of food and beverage items in pantry cars back in 2019.

New Delhi: In a significant development, the contractors providing catering services on Indian Railways have pushed forward their list of demands amid the rise in petrol, diesel, and gas prices owing to the Iran-Israel conflict. It is important to note that in the open market, vendors selling tea, samosas, chaat, pakoras, and chole bhature have already raised prices.

There is an organization of contractors providing food and catering services on trains called the Indian Railway Mobile Caterers Association (IRMCA). The association is headed by Sharan Bihari Agrawal, who is said to be the owner of RK Business Group.

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As per a Navbharat Times report quoting people familiar with the matter, the companies under this group manage pantry services in nearly 70 percent of Cluster-A trains, which include premium and important trains such as Rajdhani, Shatabdi, and Vande Bharat Express.

Recently, a letter bearing his signature was sent to the Director of Catering Services (DCS) at the Indian Railway Catering and Tourism Corporation (IRCTC).

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What is the demand?

The Indian Railway Mobile Caterers Association (IRMCA), in its letter, has said that IRCTC had fixed the prices of food and beverage items in pantry cars back in 2019. Since then, the prices of these items have reportedly increased by up to 250 percent. Additionally, staff salaries have also gone up. Therefore, the association has demanded that food and beverage prices be revised accordingly. According to them, this is necessary to maintain the quality of food and services.

Here are some of the key details:

• Food services in Indian Railways are broadly provided in two categories
• Prepaid products and postpaid products are the two categories.
• In premium trains such as Rajdhani, Shatabdi, and Vande Bharat Express, passengers pay for food in advance
• Food items provided on premium trains are categorized as prepaid.
• In other trains, passengers pay after purchasing the items, making them post-paid products.
• The association has demanded an immediate increase in prices for both categories of food and beverage items.
• If the theory of a 250 percent rise in costs is accepted, passengers are likely to face a significant increase in expenses.

What are the provisions in railway tenders?

Pantry car contracts in trains are awarded on a “fixed-rate supply” basis, according to the people familiar with railway operations. Regardless of the duration of the contract, prices cannot be increased during the contract period. There is no provision in the tender clauses that allows a rate hike midway through the contract term.

This means that whichever company has secured the contract for a specific period must continue operating at the agreed rates for that duration. A contractor cannot put pressure on the railways to increase prices in the middle of the contract period. If the railways decide to revise rates, the new prices will only apply to future tenders issued after that date. Existing contracts will continue at the previously agreed rates.

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