The Indian Railway King


Indian Railways was in trouble: in 2001, a report by the BJP—a government dominated by the Brahmins who are Lalu’s permanent foes—predicted it would hemorrhage cash at a rate of $12 billion annually by 2015. (The whole budget of the Indian government, by comparison, is $128 billion.) Indian Railways was barely managing to cover its daily operating costs, to say nothing of paying for the new equipment and strengthening bridges. The report concluded: “It is very likely that Indian Railways would be a heavily-loss-making entity—in fact one well on the path toward bankruptcy, if it were not state owned.” Outsiders whispered the word “privatization” but were hushed: Indian Railways has been a source of national pride since before independence, and statist sentimentalists could never let it fail.

Lalu’s term as railways minister has been shockingly successful. Instead of turning India’s most prized national institution into a basketcase and a ruin, Lalu has led one of most spectacular economic turnarounds in a country bursting with economic miracles. Indian Railways began raking in cash and posting surpluses in the billions. And the intelligentsia and technocracy, at first shocked and dismayed that a shameless populist had seized a fragile and unwieldy national institution, have largely come around to acknowledging that India Railways has been transformed into a respected institution—and so, possibly, has Lalu.

I have always wondered how exactly Lalu turned around the Railways but somehow never bothered to look it up. Turns out Lalu was smart enough to appoint a shrewd businessman (who idolized Jack Welch) as his deputy and getting out of his way.  That sounds pretty similar to what Michael  Dell had to say about leadership- identifying good leaders and letting them lead.

This is a very well researched and authored article on the Indian Railway King by Graeme Wood.


About P

Doing my best to achieve personal and work balance. I have a lot of interests and I need to find the right balance to spend time doing them all!
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One Response to The Indian Railway King

  1. apu says:

    I thinks Laloo gets too much credit. If he is that good, how come he didn’t turn Bihar around? The truth is that (apart from getting a good guy at the helm), he also rode in on an economic boom where manufacturing in India was doing great and consequently, freight traffic on the railways peaked. His record on things like railway safety or improving food and hygiene on trains etc is abysmal.

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