Freight wagon market in India set to double by 2031 driven by exports, tech upgrades: Report

India’s freight wagon market is projected to nearly double by 2031, reaching Rs. 25,000 to Rs. 30,000 crore (US$ 2.83 to US$ 3.4 billion) from the current Rs. 12,000-14,000 crore (US$ 1.36-1.59 billion), according to a report by Stewart and Mackertich Financial Services (SMIFS). The growth, estimated at a compound annual growth rate (CAGR) of 10-12%, will be driven by export opportunities, rising freight demand, and technological upgrades. The report highlighted that large-scale procurement by Indian Railways (IR), coupled with growing private sector participation, has underpinned current market momentum. Government initiatives to raise IR’s freight share from 27% to 45% by 2030 and double freight volumes to three billion tonnes by the decade’s end are expected to fuel further expansion.
Supporting this transformation, Indian Railways added 5,300 km of tracks in FY24, with the pace improving from four km per day in 2015 to 14.5 km per day at present. For FY25, IR targets 5,500 km of new tracks, of which 3,433 km have already been commissioned between April and December 2024. Over the next five years, 25,000 km of new tracks are planned, alongside upgrades of nearly 23,000 km for speeds up to 130 km per hour. The report noted that these infrastructure investments, along with dedicated freight corridors, modern signalling, and station upgrades, will necessitate advanced, high-capacity wagons to improve efficiency, reduce turnaround times, and lower logistics costs. With the modernisation of maintenance systems and adoption of technology, the freight wagon sector is set to play a pivotal role in India’s logistics transformation. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.