Gov’t Proposes Increase in RTL Ferry Ticket Prices to Offset Subsidies
Photo: MTCC
Minister of Transport and Civil Aviation Mohamed Ameen has suggested raising ticket prices for the Raajje Transport Link (RTL) high-speed ferry service, citing concerns over the sustainability of the heavily subsidised project.
Addressing the Parliament’s Economic Committee, Ameen commended the RTL service piloted by the former administration, describing it as a well-implemented initiative but highlighted that the ongoing subsidy model is financially unsustainable in the long term.
He revealed that the government initially spent MVR 48 million on RTL subsidies in its first year. This expenditure rose to MVR 130 million last year and is projected to reach MVR 280 million by the end of this year.
Ameen noted that RTL’s current operational model depends on subsidies covering 80 percent of costs, with only 20 percent of expenses offset by ticket sales. If maintained, this approach could see subsidies increase to MVR 1 billion upon the project’s nationwide completion.
To address this, Ameen stated that a proposal has been submitted to the Economic Council to adjust the subsidy model. Under the proposed plan, the government would reduce subsidies to 55 percent, with the remaining 45 percent to be recouped through increased ticket prices.
“RTL is a good service that people want,” he said, “the important thing is to expand it and sustain it. We cannot sustain it in this current model”
Initially launched in the northern atolls of Haa Dhaalu and Haa Alif, the RTL service has since expanded to Noonu, Lhaviyani, Gaafu Alif, and Gaafu Dhaalu Atolls.
Ameen stated that the administration will follow the original rollout plan, first connecting the northern and southern atolls before eventually linking the central atolls. However, Ameen expects to finish roll out to cover the entire country by 2026 instead of 2027.
Since its inception, the RTL ferry service has gained popularity, particularly in the northern atolls, where it has provided an affordable alternative to costly private speedboat services for inter-island travel.