In a little-noticed circular in February 2013, just a few weeks before the railways budget was presented, Indian Railways silently announced that they would start rounding up ticket fares to the nearest multiple of five. For example, if a ticket cost ₹122, it would be rounded up to ₹125. It would never be rounded down. In the railways budget that followed, no fare hikes were announced. The fare tables are not in multiples of five, so the rounding-up policy was essentially an across-the-board fare hike implemented silently. Now, the Railway Ministry has told MediaNama in response to an RTI application that it doesn't know how much revenue was earned by rounding up fares. Rounding up policy This is how the rounding-up policy works if you're booking your ticket online. When you book your ticket online, this is what the fare breakdown looks like: That's an interesting breakdown because while the base fare is not a multiple of five, the other taxes and online booking charges are. Then how do they add up to a multiple of five? Simple: the base fare was rounded up, from ₹2206 to ₹2210. The round-up isn't disclosed in the breakdown but is mentioned at the end of the legend explaining the breakdown. So the numbers literally don't add up. This happens millions of times each day. Estimating the extra revenue While base fares are rounded up to the nearest multiple of five, they don't start out that way — fares are an arithmetic function of…
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