THE nearly N$84 million Finance Minister Saara Kuugongelwa-Amadhila earmarked in her 2010-11 Budget to upgrade railway infrastructure is "meagre" and won't improve the efficiency of the railway system, the Institute of Public Policy Research (IPPR) has warned.

Releasing its annual budget analysis, the IPPR said the one-off subsidy to help TransNamib fund its capital projects is a "meagre amount when compared to a further N$350 million for NamPower, and given the mammoth task ahead for the railway company".

The Minister granted NamPower subsidies of N$100 million in 2010-11, N$100 million in 2011-12 and N$150 million in 2012-13. This is on top of the N$120 million she approved last year.

TransNamib, on the other hand, received N$83,9 million for the current book year.

Not a penny has been budgeted for the next two financial years, and TransNamib also didn't get a subsidy last year.

Namibia needs major investment into its railway sector, IPPR research associate Klaus Schade said.

"The extension of harbours as well as of the railway lines to Oshakati and Angola, and the plans for a Trans-Caprivi railway line will require a major rehabilitation and upgrade of the existing network," he said.

According to Schade, passenger train services to the North have been stopped, "reportedly because of fears for the safety of passengers since some stretches of the network have become dilapidated".

"Major investment is required to bring the current network up to standard, before even considering replacing the century-old narrow gauge with a standard gauge that would allow for higher speeds," he said.

With N$84 million only "some major problems" can be fixed, Schade said.

"But it will not improve the competitiveness of the railway system at large, and this could render the expansion of the network inefficient," he said.

Beside the subsidy, Kuugongelwa-Amadhila has also N$1,5 billion for railway network upgrading in the current financial year. The project will receive only N$628 million next year, followed by N$80 million in 2012-13.

The northern railway line extension received N$103 million in the current budget, while N$106 million and N$70 million will be spent on it in 2011-12 and 2012-13 respectively.