Kejriwal Versus Surge Pricing: Delhi CM Objects To Railways’ New Flex-Fare

The Ministry of Railways has decided to introduce surge pricing for Rajdhani, Duronto and Shatabdi trains, which will come into force from 9 September. However the revised fares will not be applicable to tickets already issued in advance for journeys on or after the assigned date. Additionally there will be no change in the existing fare for 1AC and EC class of travel.Under this new formula, fares in the higher classes on these trains can go up by a maximum of 1.5 times the base fare.

Usually surge pricing occurs when a company increases the value of its services if there is an upsurge in demand. Price hikes in railway in this manner is carried out keeping the festive season in mind when demands for railway tickets will be high.

If passenger is in need of a train ticket when too many people want it, he/she has to pay more. This logic of dynamic pricing can be seen in airlines, where the early bird gets cheap tickets and the last few seats are priced sky-high. Passengers may dislike it, but if demand is more than supply by a huge multiple, “surge” pricing is the solution.

The system of surge pricing introduced by app-based cab service like Ola and Uber led to political controversies in the recent past. Predictably, one of the staunchest opponent of this move by the MOR is the Delhi CM and AAP chairman Arvind Kejriwal.

CM Kejriwal tweeted his disappointment on the issue while travelling today to Ludhiana on a Shatabdi. Kejriwal claimed in his tweets that he has talked to people and everybody is against this move of the Modi government.

It would be interesting to see whether Kejriwal would continue raising this issue or if it is just a matter of a few tweets.