Economy

Kenya Railways seeks to raise SGR fare to Sh1,200

madaraka

Passengers board the Madaraka Express train at the Nairobi terminus on June 7. FILE PHOTO | NMG

The promotional Sh700 fare on standard gauge railway (SGR) "Madaraka Express" train between Nairobi and the coastal town of Mombasa will be withdrawn in the next two months.

Kenya Railways managing director Atanas Maina said Friday the charges could be adjusted to Sh1,200 after approvals by the Transport Ministry.

The Sh3,000 fare for first class passenger on the train will however remain the same in the new fare regime set to be opposed by majority SGR travellers.

“We shall be announcing the rates in April once approved but will not exceed Sh1,200,” said Mr Maina in an interview with the Business Daily.

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Test service

“The government made a deliberate decision to charge low fare to allow Kenyans from all walks of life to test the service at inception stage so that they can judge for themselves the nature of the product we were introducing to the market.”

President Uhuru Kenyatta had in May fixed the fare at Sh700 for economy class ticket and Sh3,000 on first class ticket for passengers travelling from Nairobi to Mombasa.

This was a reduction from the initial Sh900 which had been announced earlier by Infrastructure Cabinet Secretary James Macharia.

The aim was to drive traffic in the Kenya’s biggest infrastructure project since independence funded by the Exim Bank of China.

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Operational costs

The subsidised SGR train fare is not enough to meet the operational cost in the short term.

This has forced taxpayers to top up the fare to pay the loan and meet the operational costs of the new rail constructed by China Road and Bridge Corporation.

The National Treasury allocated Sh15.5 billion to upgrade the SGR commercial operations before its launch last June.

The 472 km SGR railway line between Mombasa and Nairobi was constructed at a cost of Sh327 billion co-financed through commercial and semi-concessional loans from China and the Kenyan government.

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