Indian Railways is eager to hike passenger fares as its financial condition is not good and otherwise it will not survive, Minister of State for Railways KJ Surya Prakash Reddy said.

The national transporter is struggling to slash its deficit of more than Rs 20,000 crore in the passenger segment. It is keen to hike passenger fares by 5 paise to 10 paise per km. This will generate revenue of around Rs 4,000 crore.

In a recent interview, Mr. Reddy said, "The passenger fares should be hiked by 5 paise to 10 paise per km in the Rail Budget (2013-14). The financial condition of Railways is not good. We need funds, otherwise Railways will not survive."

The increase in passenger fares could come close on the heels of finalizing of the broader contours of the proposed Rail Tariff Authority, which will be tabled before the Cabinet sometime in January.

Adhir Ranjan Chowdhury, the other Minister of State for Railways, also advocated an immediate increase in passenger fares, saying the transporter's financial condition was bad.

Railways' loss in the passenger segment jumped from nearly Rs 18,000 crore in the last financial year to Rs 22,000 crore in current financial year.