In April the trains to Bangalore from all over the country were overbooked. The waiting list stood at a staggering 13,000. Most of the passengers were anxious parents accompanying students headed for the combined engineering entrance examination. Faced with such a situation, the families had two options-either pay more and take a flight or just drop the exam. The Indian Railways stepped in at this critical juncture and decided to run 13 special trains from across the country to meet the sudden demand.

This season, the Railways has used 3,300 special trains to meet similar demand surges. And this is just one of the many initiatives it is taking to improve its image and services. "All this is happening for the first time. We realise that we need to have a flexible strategy and good customer interface," says P.K. Goel, executive director, passenger marketing, Ministry of Railways.

The new initiatives are in contrast to the Railway's image of a creaky, impersonal and outmoded monolith. They include:

An estimated Rs 10-crore inhouse data-warehousing project to connect 720 locations across the country. This will enable the organisation to analyse and collate data on countrywide passenger movement on a daily basis. The result: it will be able to better monitor the demand-supply gap and respond accordingly.

Last week, for the first time ever, Mumbaikars bought suburban rail tickets from ATM counters. The Railways has tied up with 13 banks to make the tickets available at ATM counters in the city. Soon rail tickets across the country can be bought on ATMs and through smart cards in major cities.

From June, those with access to the Internet will be able to book rail tickets online.

Also in June, the Railways will unveil its web-based information system called National Train Enquiry System that will give real-time status (with a five-minute lag) on train arrivals and departures. This will be updated every half an hour. With time this will also be available on cell phones.

The same applies to unreserved tickets which are currently available only at the point of departure. Passengers will be able to buy unreserved tickets on the Net and at ATMs.

Aggressive marketing initiatives like "Travel by ac First Class and take your spouse for free" and "Travel ac Second Class and upgrade to ac First Class" are being considered to push sales in the top-end segment.

Buttressing this will be the launch of flexible pricing and differentiated service. By December 2002, the Railways hopes to start flexi-fares, higher during peak times when demand shoots up by 20-30 per cent and lower fares during non-peak season. Ditto for the suburban railways.

Adding variety to existing products are the stripped down versions of premium services like the Jan Shatabdi to cater to the price-sensitive segments. There will be feature-loaded upper class service to appeal to the top-end of the travellers.

These new initiatives by the Railways are not just a pr exercise but a response to market reality. Its monopoly is coming under threat with airlines eating into its profitable ac First Class traffic. This year, occupancy in this class on the Delhi-Mumbai Rajdhani has dropped from a peak 70 per cent to 40 per cent. The flexible pricing introduced by the airlines in November last year is making matters worse. The airlines started offering 14 per cent discount on late-night and weekend flights that translated into higher occupancy levels. For example, Air Sahara saw an instant jump of 16 per cent in occupancy.

The Central Government's plans to build more expressways across the country is also adding to the Railways' woes. For example, the Mumbai-Pune Shatabdi has witnessed a traffic slump of 27 per cent last year because of the newly built expressway between the two cities. "The airlines are giving us serious competition," bemoans a Railways official. "Now the expressways and the national highway will give us even more competition."

The 13 million passengers who use the Railways each day are, however, not complaining. Their passage across India is moving on the right track.