Indian govt plunged into new crisis over rail fare increases

The Indian government was plunged into yet another crisis on Thursday by a rebellion within its own ranks over a proposed rise in rail fares, underscoring its inability to take unpopular steps and frailty in the face of querulous coalition allies.

The latest pressure on the government has fanned speculation that it could fall, triggering an election two years ahead of schedule. However, analysts said most political parties had no appetite for an early poll and - although a mid-term vote cannot be ruled out - the government was likely to limp on.

Breaking with years of populist policies, Railway Minister Dinesh Trivedi this week announced the first increase in passenger fares in eight years, a move aimed at shoring up the finances of a rail network whose dysfunction has become a major drag on the economy.