Core Viewpoint - The article discusses the financial challenges faced by urban rail transit systems in China, particularly focusing on the recent fare increases in Chongqing and the severe financial distress of the Kunming rail transit system. It emphasizes that while fare increases are necessary for sustainability, they reflect deeper issues within local government finances and urban planning strategies [2][4][10]. Summary by Sections Fare Increases and Financial Sustainability - Chongqing's metro system is raising fares due to insufficient ticket revenue, which has been a long-standing issue. The fare system has not changed since 2005, making the increase understandable after 20 years [2][3]. - In 2023, Chongqing's rail transit group received fiscal subsidies of 8.538 billion yuan and is projected to receive 4.347 billion yuan in 2024, highlighting the reliance on government support to cover operational losses [3]. Local Government Finances - The financial health of urban rail systems is closely tied to local government finances, serving as a barometer for fiscal stability. Chongqing's total government debt is projected to rise from 1.2258 trillion yuan at the end of 2023 to 1.4425 trillion yuan by the end of 2024, indicating increasing debt pressure [4]. - The city's public budget revenue is around 700 billion yuan, with significant debt repayment obligations, suggesting a challenging fiscal environment ahead [4]. Impact of Fare Increases - While fare increases are a necessary measure, they are not the preferred solution due to potential public backlash. The government is prioritizing cost-cutting measures over revenue generation through fare hikes [4][5]. - The expected revenue increase from the fare hike in Chongqing is estimated at 1.1 billion yuan, which, while helpful, is significantly lower than previous subsidies [5]. Comparison with Kunming - Kunming's rail transit system faces a more severe financial crisis, with a total debt exceeding 100 billion yuan and a history of defaulting on bond payments. The city's rail system has been criticized for poor planning, leading to low passenger volumes [6][9]. - The article highlights that Kunming's rail system has been mismanaged, with a focus on land development rather than efficient transit planning, resulting in high costs and low returns [7][9]. Broader Implications - The article warns against the trend of rapidly developing urban rail systems in second and third-tier cities without proper planning, which can lead to financial burdens and incomplete projects. The example of the dismantled light rail pillars in Liuzhou illustrates the consequences of hasty infrastructure investments [9][10]. - Overall, the article suggests that urban rail systems should primarily serve public transportation needs rather than being seen as tools for land value appreciation, as misguided priorities can lead to unsustainable financial practices [10].