India has the fourth-largest railway system in the world, following the US, Russia, and China. As of FY23 (January 2023), the Indian Railways had 13,523 passenger trains and 9,146 freight trains. As of FY22, it had a total route network of 68,103 km. Indian Railways has logged the highest-ever electrification of sections covering 6,015 Route Kilometer (RKM) in a single year during 2020-21. More than 5 times electrification was achieved during (2014-21) the last seven years as compared to 2007-14. By 2024, Indian railways will be run completely on electricity.

The railway sector has seen some developments, investments, and support from the Government in the recent past.

Revenue growth has been strong over the years. Indian Railways’ revenue reached US$ 32.23 billion by the end of the fiscal year 2023-24.

The total passenger revenue stood at US$ 8.51 billion during 2023-24, registering an increase of 9% in comparison to US$ 7.78 billion achieved during the same period last year.

In FY23 (until October 2022) passenger traffic stood at 3.61 billion.

From April-January 2023, railway freight loading of 1243.46 MT was achieved against last year’s loading of 1159.08 MT which depicted an improvement of 7%.

The new & upgraded version of Vande Bharat Express between Gandhinagar Capital & Mumbai Central was inaugurated by Prime Minister Mr. Narendra Modi on September 30, 2022.

FDI inflows in railway-related components stood at US$ 1.23 billion from April 2000-March 2023.

In August 2022, the government launched Mission Raftaar for speed enhancement and to achieve a target of doubling the average speed of freight trains and increasing the average speed of superfast /mail/express trains by 25 kmph

Freight remains the key revenue-earning segment for Indian Railways, accounting for 75.2% of the total revenue in FY22, followed by the passenger segment.

Total revenue from traffic for 2022-23 is estimated to be Rs. 2,39,600 crore (US$ 28.93 billion), an increase of 19% over revised estimates for 2021-22. Freight revenue is estimated to be Rs. 1,65,000 crore (US$ 19.92 billion) in 2022-23, an increase of 14% over the revised estimates for 2021-22.  The passenger revenue is estimated to be Rs. 58,500 crore (US$ 7.06 billion), an increase of 32% over a low base in 2021-22.

Under the Union Budget 2023-24, a capital outlay of Rs. 2.40 lakh crore (US$ 29 billion) has been allocated to the Ministry of Railways, which is the highest ever outlay and about nine times the outlay made in 2013-14. The government allocated US$ 29 billion to the Ministry of Railways. The Bairabi-Sairang project aims to create an additional 51.38 km of railway track in northeast India.

In the Union Budget 2022-23:

• The government allocated Rs. 140,367.13 crore (US$ 18.40 billion) to the Ministry of Railways.
• Indian Railways will develop new products and efficient logistics services for small farmers, and small and medium enterprises. It will also take steps towards the integration of postal and railway networks to provide seamless solutions for the movement of parcels.
• 100 PM-GatiShakti Cargo Terminals for multimodal logistics facilities will be developed over the next three years.
• Multimodal connectivity between mass urban transport and railway stations will be facilitated on priority.
• 2,000 km of the network will be brought under Kavach, the indigenous technology for safety and capacity augmentation.
• ‘One Station-One Product’ concept will be popularized to help local businesses and supply chains.

RailTel, a PSU under the Railway Ministry, which provides fast and free Wi-Fi across the Indian Railways network, announced its highest-ever consolidated income of Rs. 704 crore (US$ 85 million) for Q4 of FY23. This income figure is a growth of 5% over the consolidated income of the same quarter income last year.

In November 2021, Indian Railways announced that ~102 semi-high-speed Vande Bharat Expresses are expected to commence operations by 2024, with at least 10 new trains scheduled to launch by August 2022 that will connect 40 cities.

In October 2021, India and Nepal signed an MoU (Memorandum of Understanding), for a proposed US$ 3.15 billion railway line project, to connect Kathmandu and the Indian border town, Raxaul.

In October 2021, Indian Railways announced a plan to establish ~500 multi-modal cargo terminals under the ‘PM GatiShakti’ programme, with an estimated outlay of Rs. 50,000 crore (US$ 6.68 billion) in four-five years. Through this plan, the government plans to integrate various modes of transportation for the seamless movement of parcel and bulk cargo (e.g., coal and steel).

Indian Railways has undertaken a mega-infrastructure project of two Dedicated Freight Corridors (DFC) namely Eastern and Western Dedicated Freight Corridors (EDFC & WDFC) to facilitate the faster evacuation of freight traffic.

The punctuality performance of Indian Railways for mail and express trains increased to 71.25% during April 2022-23 compared to 89.21% during the same period last year.

The Ministry of Railways plans to monetise assets including Eastern and Western Dedicated Freight Corridors after commissioning, induction of 150 modern rakes through PPP, station redevelopment through PPP, railway land parcels, multifunctional complexes (MFC), railway colonies, hill railways and stadiums.

With increasing participation expected from private players, domestic and foreign, due to favourable policy measures, both passenger and freight traffic is expected to grow rapidly over the medium to long term. The Government of India’s focus on infrastructure is a major factor which will accelerate the growth of railways. Railways infrastructure plans to invest Rs 50 lakh crore (US$ 715.41 billion) by 2030.

29 supercritical projects—spanning 1,044 km and costing Rs. 11,588 crore (US$ 1.5 billion)—have been commissioned. Four projects worth Rs. 1,408 crore (US$ 189.05 million) have been completed and the remaining projects are targeted for completion by March 2024. The Indian Railways got a total allotment of US$ 1.71 trillion (Rs 1, 40,367.13 crores) in the  Union Budget for expediting all the critical and supercritical rail projects, infrastructure, and capacity enhancement-related projects.

Indian Railways completed eight major capacity enhancement projects by taking advantage of the coronavirus lockdown. These projects included three supercritical projects with a combined length of 68km, three critical projects with a combined length of 45km, the upgradation of the entire 389km railway line from Jhajha in Bihar to Pandit Deen Dayal Upadhyaya junction in Uttar Pradesh and a new 82km port connectivity line to Paradip.

During 2022-23, electrification of 1,973 Route km (2,647 TKM) has been achieved, which is 41% higher as compared to the corresponding period of 2021-22.

As a part of the Railways’ plans to upgrade its network, the Ministry announced that all non-AC sleeper coaches will be replaced by AC coaches for trains running >130 kmph. This move has been taken as a technical necessity for high-speed trains with the bonus of improving the passenger experience.

On July 25, 2021, the Indian Railways Station Development Corporation (IRSDC), a nodal agency of the Ministry of Railways spearheading the re-development of railway stations across the country, claimed that the two railway stations will be redeveloped at an indicative cost of Rs. 1,285 crore (US$ 172.54 million) in four years.

The Indian Railways has decided to undertake electrification of Broad Gauge (BG) rail lines in a mission mode and is likely to complete the process by 2023-24. Of the 64,689 km of broad gauge route, 45,881 km has been electrified and the remaining 18,808 km route is yet to be electrified. About Rs. 21,000 crore (US$ 2.8 billion) is estimated to be spent on electrification of the remaining BG routes.

The future outlook of the railway sector looks on track with the pandemic easing out.

Railways are leading India’s fight against climate challenges and are taking significant steps towards meeting its ambitious goal of being a net zero carbon emissions organisation by 2030 and meeting India’s Intended Nationally Determined Contributions (INDC) targets.

The future outlook of the railway sector looks on track with the pandemic easing out.

Indian Railway network is growing at a healthy rate. In the next five years, the Indian railway market is expected to be the third largest in the world, accounting for 10% of the global market.

The ‘Adarsh’ Station Scheme was started during 2009-10 and presently, railway stations are upgraded/modernised based on the identified need to provide better-enhanced passenger amenities at stations. Under the scheme, 1253 stations have been identified for development, out of which 1,215 stations so far have been developed. The remaining 38 stations are planned to be developed by 2022- 23.