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Myanma Railway is Loss Making Department: Union Minister

Myanma Railway under the Ministry of Transportation and Telecommunications is a loss-making government department, U Thant Sin Maung, Union Minister of the ministry, said at the Amyotha Hluttaw in answering the question of U Pe Tin, a law maker from Mon State’s constituency no.6.

U Pe Tin questioned the government if it has a calculated plan to make Myanma Railway generate more income, this way they can compensate the losses they have incurred.

Since Myanma Railway needs to pay back a loan of K126 billion to Paris Club member countries which was borrowed in 1988, its expenses exceed much more than its income, the union minister explained.

“2019-2020 Fiscal Year is very worrying. We need to pay back the loan borrowed before 1988. Since we cannot make anything related to the train, we must pay everything if we have money for the loan. Although Paris Club has dropped its loan to half of what we owe, there is still K126 billion left to payback. This is double the income of Myanma Railway. In addition, we have over 18,000 pensioners and we need to pay over K1 billion in pension every year. Thus, the department is already a loss-making department before it does anything else,’’ he added.

The ministry is trying to convince private investors to come and invest in the railway sector. However, since railway transportation business are very costly and need up to 30 years to see profit, it is very hard to convince investors to make investments in the railway business, the union minister groaned.

“People must have choices to choose whether they will use road transportation, railway, air or waterway. We need to create better choices for the people. In the future, the government will not operate the railway or the road transportation. We will build the environment where private investors can invest and compete with each other,’’ he added.

According to Asia Development Bank’s estimation, the transportation services that Myanma railway provide now services only 10 percent of the transportation in Myanmar, it will drop though to 2 percent if the government does not innovate or upgrade its infrastructure.

Source:https://www.mmbiztoday.com/articles/myanma-railway-loss-making-department-union-minister