India has the fourth-largest railway system in the world, following the US, Russia, and China. The railway sector has seen some rapid developments, investments, and support from the Government in the recent past.
Indian Railways runs 13,523 passenger trains and 9,146 freight trains daily on its network with passenger trains running at an average speed of 50.6 kmph and freight trains at 24 kmph. 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 Kilometre (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.
In March 2024, Prime Minister Mr. Narendra Modi inaugurated infrastructure projects worth Rs. 15,400 crore (US$ 1.84 billion) in Kolkata, including India's first underwater metro system, to improve connectivity in west Bengal.
The Cabinet Committee on Economic Affairs, led by Prime Minister Mr. Narendra Modi, approved two railway projects totalling Rs. 6,798 crore (US$ 808.8 million). These include doubling the 256 km Narkatiaganj-Raxaul-Sitamarhi-Darbhanga and Sitamarhi-Muzaffarpur sections, and constructing a 57 km new line from Errupalem to Namburu via Amaravati..
Indian Railways is introducing India’s first cargo liners with a double-decker design. The upper deck will have passenger seating, while the lower deck is dedicated to cargo storage. Trials for these trains are currently underway.
The Indian Railways completed total revenue of Rs. 2.40 lakh crore (US$ 28.75 billion) by the end of the fiscal year 2023-24.
Total Number of passengers increased by 52 crore to reach 648 crore in FY 2023-24.
In FY24, freight loading crossed by 1588 MT against last year’s loading of 1512 MT.
In 2023-24, traffic revenue is estimated to be Rs. 2,64,600 crore (US$ 32.18 billion), comprising 99.8% of the total revenue.
The Indian Railways completed total revenue of Rs. 2.56 lakh crore (US$ 30.76 billion) by the end of FY24. The passenger revenue came to be Rs. 70,000 crore (US$ 8.77 billion), an increase of 9% in 2023-24.
In FY 2022-23, Indian Railways achieved 1,512 MT of freight, 94 MT more than the previous best of 1,418 MT in FY 2021-22, showing 7% growth, also generated revenue of Rs. 1,60,158 crore (US$ 19.28 billion) from freight services.
In FY 2023-24, Indian Railways loaded 1,434.03 MT of freight from April to February, an increase of about 66.51 MT and Revenue rose by approximately Rs. 6,468 crore (US$ 778 million) compared to the same period last year.
Prime Minister, Mr. Narendra Modi inaugurated a significant expansion of India's rail network by introducing 10 new Vande Bharat trains, bringing the total count to over 50 trains covering 45 routes nationwide.
As on January 31, 2024, 41 trains of the Vande Bharat service are running on the Indian Railways, linking states with a Broad Gauge (B.G.) electrified network.
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$ 1.41 billion from April 2000-June 2024.
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.
In October 2023, it was reported that, India’s investments in infrastructure will rise to Rs. 143 trillion (US$ 1.71 trillion) between the financial years 2024 and 2030, as per analytics firm CRISIL.
In June 2023, IRCON (formerly Indian Railways Construction Company Limited) signed a memorandum of understanding (MoU) with the National Investment and Infrastructure Fund Limited and Ayana Renewable Power Limited. This partnership will consider suitable opportunities for solar energy production for the Indian Railways as they intend to increase the share of renewables in their overall energy mix.
With a view to improve rail connectivity and ease travel for commuters, the Union Cabinet approved seven projects for the Ministry of Railways in August 2023 at a cost of around Rs. 32,500 crore (US$ 3.93 billion). Spanning 35 districts in nine States - Uttar Pradesh, Bihar, Telangana, Andhra Pradesh, Maharashtra, Gujarat, Odisha, Jharkhand, and West Bengal, the projects will add 2,339 km to the existing network speed.
In FY23, North-Western Railway registered the highest growth in freight earnings at Rs. 6,839.93 crore (US$ 832.39 million), which is 30.82% higher than last year’s earnings of Rs. 5,228.13 crore (US$ 636.3 million). Freight loading also increased to 32.69 million tons, which is 10.07% higher than last year’s loading of 29.70 million tons.
India’s export of railways grew at and reached US$ 1,249.38 million in FY22 as compared to US$ 633.27 million in FY21.
According to Indian Railways yearbook 2023, Railways plan to market semi-high-speed ‘Vande Bharat’ trains by 2025-26, aiming to cover 10-12 lakh kilometres on 75 trains in three years. Railways will target European, South American, and East Asian markets for exporting 'Made in India' trains.
Under the Interim Budget 2024-25, a capital outlay of Rs. 2.52 lakh crore (US$ 30.3 billion) has been allocated to the Ministry of Railways, which is the highest ever outlay and about ten 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 Interim Budget 2024-25:
- Under the Union Budget 2024-25, the government allocated Rs. 2.62 lakh crore (US$ 31.5 billion) to the Ministry of Railways.
- 5.02 lakh candidates were hired by the railways between 2014 and 2024.
- Indian Railways will be establishing three key railway programs to boost the economy: energy, mineral, and cement transport routes; port connections; and busy traffic routes.
- There will be Conversion of 40,000 conventional rail bogies to ‘Vande Bharat standards.
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.
Indian Railways plans to market semi-high speed ‘Vande Bharat’ trains by 2025-26, aiming to cover 10-12 lakh kilometres on 75 trains in three years. Indian Railways will target European, South American, and East Asian markets for exporting 'Made in India' trains.
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.
As of January 2023, a total of 1,724 kilometres of Dedicated Freight Corridor (DFC) had been commissioned, with 861 kilometres completed on the Eastern Dedicated Freight Corridor (EDFC) and 863 kilometres on the Western Dedicated Freight Corridor (WDFC).
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.
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 Indian Railways electrified 58,812 Route Kilometers (RKMs) till March 31, 2023, which is about 90% of the total broad-gauge network (65,300 RKMs) of Indian Railways. 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.
Introducing 3,000 new trains over the next four to five years to increase the current passenger capacity of the railways from 800 crore to 1,000 crore, will help to meet the needs of the expanding population.
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.
