Railway Sector

Indian Railways

• Indian Railways is the fourth largest railway network in the world in terms of route length. It carries the largest number of passengers globally and also stands as the fourth largest freight transporting system. However, the share of railways in surface freight transport has steadily declined, dropping from 86.2 per cent in 1950–51 to only 33 per cent in 2015.

Historical Development

1. Western Region

• The first railway line in India was laid between Bombay and Thane, covering a distance of 21 miles. The idea was first suggested in 1843 by George Clark, the Chief Engineer of the Bombay Government. The line was formally inaugurated on 16 April 1853, when fourteen carriages carrying about 400 guests left Bori Bunder station at 3:30 pm amidst great public applause and a salute of 21 guns.

2. Eastern Region

• On the eastern side of the subcontinent, the first passenger train ran from Howrah to Hooghly on 15 August 1854, covering 24 miles. This marked the opening of the first section of the East Indian Railway for public use.

3. Southern Region

• In the south, the first railway line was opened on 1 July 1856 by the Madras Railway Company. It connected Vyasarpadi Jeeva Nilayam (then Veyasarpandy) with Walajah Road (Arcot), covering a distance of 63 miles.

4. Northern Region

• In northern India, a railway line between Allahabad and Kanpur, measuring 119 miles, was inaugurated on 3 March 1859. Later, another section from Hathras Road to Mathura Cantonment was opened to traffic on 19 October 1875.

5. Central Public Sector Enterprises (CPSEs) under Indian Railways

• There are 12 Central Public Sector Enterprises (CPSEs) functioning under the administrative control of the Ministry of Railways, each catering to different domains such as finance, infrastructure development, connectivity, catering, and telecom. These are: (i) RITES Ltd., (ii) IRCON International Ltd., (iii) Indian Railway Finance Corporation (IRFC), (iv) Container Corporation of India Ltd. (CONCOR), (v) Konkan Railway Corporation Ltd. (KRCL), (vi) Mumbai Railway Vikas Corporation (MRVC), (vii) Indian Railway Catering & Tourism Corporation (IRCTC), (viii) RailTel Corporation of India Ltd. (RCIL), (ix) Rail Vikas Nigam Ltd. (RVNL), (x) Dedicated Freight Corridor Corporation of India Ltd. (DFCCIL), (xi) Kolkata Metro Rail Corporation Ltd. (KMRCL), and (xii) Braithwaite and Company Ltd. (BCL).

6. Research and Development (R&D)

• The Research Design and Standards Organisation (RDSO), based in Lucknow, is the R&D wing of Indian Railways. It provides technical consultancy to Indian Railways and other associated organisations. Recent innovations include speed and controllability trials of Vande Bharat Express and the development of the SigDATE automation tool (in collaboration with IIT Kharagpur) for route control chart generation in Electronic Interlocking systems.

7. Railway Finance and Budget Merger

• Historically, Indian Railways had a separate budget presentation owing to the Separation Convention of 1924, meant to protect civil estimates. However, since 2017-18, the Railway Budget has been merged with the Union Budget to promote multi-modal transport planning. Railways retains its functional autonomy and financial powers and now operates with a single demand for grants under the Ministry of Finance.

8. Mission 100% Electrification

• The Railway Electrification Mission is central to India’s energy and environmental goals. Electrification reduces crude oil imports, improves energy efficiency, and enhances average train speeds and load capacity. As of March 2023, 58,812 Route Kilometers (RKMs) have been electrified, including the Konkan Railway—covering nearly 90% of the Broad Gauge (BG) Network. Electrification is key to providing green, clean, and cost-effective transport.

9. Rail-Based Tourism and Bharat Gaurav Trains

• Indian Railways plays a significant role in domestic tourism. The Bharat Gaurav Trains Policy enables theme-based tourist circuit trains to showcase India’s cultural and historical heritage. State Governments, Tourism Development Corporations, and private players may run such trains, providing comprehensive packages including rail, accommodation, food, and local transport. Concessions of up to 33% are offered to promote tourism.

10. Zonal Railway Headquarters

Indian Railways is divided into 17 zones and 1 Metro Railway zone, each with a zonal headquarters:

1. Central – Mumbai
2. Eastern – Kolkata
3. East Coast – Bhubaneswar
4. East Central – Hajipur
5. Northern – New Delhi
6. North Central – Prayagraj (Allahabad)
7. North Eastern – Gorakhpur
8. Northeast Frontier – Maligaon (Guwahati)
9. North Western – Jaipur
10. Southern – Chennai
11. South Central – Secunderabad
12. South Eastern – Kolkata
13. South East Central – Bilaspur
14. South Western – Hubballi
15. Western – Mumbai
16. West Central – Jabalpur
17. South Coast – Visakhapatnam
18. Metro Railway – Kolkata

Railways (Amendment) Bill, 2024:  The Railways (Amendment) Bill, 2024, was recently passed in the Lok Sabha. Alongside this, the Parliamentary Standing Committee on Railways presented a detailed report on Railway Modernization and Financial Sustainability, highlighting structural gaps and suggesting reforms. Snapshot of Indian Railways Indian Railways constitutes the fourth largest rail network in the world with a route length exceeding 68,584 km. It contributes nearly 26 per cent of the freight traffic in the country and remains a backbone of India’s transport system. Railways (Amendment) Bill, 2024 Simplification of Legal Framework The Bill repeals the century-old Indian Railway Board Act, 1905 and merges its provisions into the Railways Act, 1989. The 1905 Act had originally constituted the Railway Board as the apex authority for administration of Indian Railways. By consolidating laws, the Bill seeks to eliminate the need for referencing two separate legislations for governance. Centralization of Powers The amendment confers additional authority on the Central Government regarding the constitution of the Railway Board. The government will now prescribe the number of members, their qualifications and experience, the terms and conditions of service, and the appointment process for the Chairman and Board members. Limitations Although the Bill simplifies the legal structure, it largely retains the centralized nature of railway administration. The Standing Committee has noted that many operational inefficiencies and financial vulnerabilities remain unaddressed, thereby necessitating deeper structural reforms for enhancing efficiency, competitiveness, and service quality. Key Highlights of the Standing Committee Report Financial Performance Railways continue to depend heavily on freight earnings. In 2023–24, revenue from freight services stood at ₹1,68,293 crore, while passenger services contributed only around ₹70,000 crore. Low passenger revenue translates into thin net returns. Recommendations: Undertake a comprehensive review of passenger fares across different classes and trains, align AC class fares with actual costs while keeping general class affordable, and boost non-fare revenues (through advertising and commercial ventures) to 20% by 2030. Operational Efficiency The average freight train speed has stagnated at 25 km/hr for over a decade. Recommendations: Accelerate the creation and expansion of Dedicated Freight Corridors to enhance speed, improve freight loading capacity, and increase earnings. Infrastructure and Modernisation Capital expenditure has increased due to higher Gross Budgetary Support, reducing reliance on Extra Budgetary Resources (EBR). However, issues like land acquisition delays and incomplete Road over Bridges (RoBs) and Road under Bridges (RuBs) have slowed progress. Recommendations: Encourage private sector investment in infrastructure and station redevelopment, reform land acquisition policies with active state government coordination, and implement the new policy of fully funding stalled RoB/RuB projects to ensure timely completion. Research and Development Budgetary allocation for railway research remains very low, with just ₹72 crore earmarked in 2024–25. Recommendations: Expand the scope of Research and Development (R&D) to assimilate modern technologies and enhance the pace of modernization. Safety The indigenous train collision avoidance system, Kavach, has been implemented only on 1,465 route km in South Central Railway and 80 km in North Central Railway, reflecting a very slow rollout. Recommendations: Ensure rapid expansion of Kavach across the national railway network to improve safety standards. Towards Green Railways Indian Railways has set the ambitious goal of becoming a Net Zero Carbon Emitter by 2030. Initiatives include 100% electrification of railway lines, sourcing power from renewable energy, water conservation, and waste management. Recommendations: Adopt Green Budgeting practices to align railway spending with environmental sustainability and climate commitments. Green budgeting involves using budgetary tools to assess the environmental impact of fina