Reforming Indian Railways

• 05 Apr 2025

For Prelims:

Comptroller and Auditor General (CAG), KAVACH, Vande Bharat Train, Hydrogen Train, Dedicated Freight Corridors (DFCs), Extra-Budgetary Resources (EBRs), Mission Raftar, Rashtriya Rail Sanraksha Kosh (RRSK).

For Mains:

Significance of Railways for India, Issues related to Indian Railways and way forward.

Source: TH

Why in News?

The Comptroller and Auditor General’s (CAG) audit report on the Ministry of Railways highlighted the various concerns in the functioning of Indian Railways.

What are Key Facts About Indian Railways?

• About: India has the 4th largest railway network in the world, with over 65,000 km of route length. 
  • In 2022, Indian Railways carried 8 billion passengers, 1.4 billion tons of freight, and is expected to contribute to 40% of global rail activity by 2050.
• Infrastructure Spending: The government plans to invest USD 750 billion by 2030, as part of a broader USD 1.4 trillion investment target (2019–2023) in infrastructure.
  • 100% FDI allowed in the railway sector, encouraging global participation.
• Innovation: KAVACH, India’s own Train Collision Avoidance System, will be deployed over 37,000 km of railway lines.
  • 15,000 km of tracks will be converted into automatic signaling zones, enhancing safety and efficiency.
  • Vande Bharat trains feature quick acceleration, automatic doors, CCTV, bio-toilets, GPS info systems, and onboard infotainment.
• Financial Performance: In 2023–24, Indian Railways earned USD 32.18 billion in traffic revenue, 99.8% of its total income, showing strong efficiency and public reliance.
• Future Plans:
  • High-Speed Rail: Mumbai–Ahmedabad bullet train and other semi-high speed trains.
  • Signaling & Telecom: Plans to upgrade around 15,000 km to automatic signaling and 37,000 km with KAVACH.
  • Digitalization: Railway puts emphasis on predictive maintenance, asset management, and GPS info systems.
  • Intermodal Transport: Integration of rail, road, and ports for smoother logistics.
• Net Zero Carbon Emissions Target: Indian Railways aims for net zero carbon emissions by 2030. As a start, it plans to run 35 hydrogen trains under the Hydrogen for Heritage program.

What is the Significance of Indian Railways?

• Lifeline for the Nation: Indian Railways is the backbone of India's transport, providing affordable, reliable travel and boosting economic integration nationwide.
• Industrial Expansion: It enables the transport of essential commodities like coal, iron ore, cement, and agricultural products, ensuring uninterrupted industrial operations.
  • Dedicated Freight Corridors (DFCs) lowers logistics costs, making Indian manufacturing more competitive in the global market.
• Employment: With over 1.2 million employees, it is the 9th-largest employer in the world.  
• Regional Development: Railways play a pivotal role in linking rural regions to urban markets, improving access to education, healthcare, and jobs in underdeveloped regions.
• Green Transport: The use of energy-efficient locomotives, green bio-toilets, and electrified routes reflects the commitment to environmental responsibility.
• National Security: Strategic rail links in sensitive areas like the North-East bolster national security and rapid mobilization.

What Concerns are Associated with Indian Railways?

• High Operating Ratio: The operating ratio (OR) for 2024–2025 is estimated at Rs 98.2—slightly better than Rs 98.7 in 2023–2024, but worse than Rs 97.8 in 2016.
  • A higher OR (amount spent to earn Rs 100) leaves less resources for capex and makes the Railways more dependent on budgetary support and Extra-Budgetary Resources (EBRs). 
• Slow Infrastructure Development: Among the DFCs (proposed in 2005), only the eastern DFC is fully operational and western DFC nears completion.
  • The east coast, east-west, and north-south sub-corridor DFC remain in the planning stage.
  • The Mumbai-Ahmedabad bullet train project has been delayed from 2023 to 2028 due to land acquisition issues.
• Inadequate Safety Technologies: While Kavach can prevent collisions through automated braking and alerts, its limited rollout reduces its overall impact. 
  • As of February 2024, it had been installed on only 1,465 route km—just 2% of the total railway network.
• Slow Journeys: Mail and express trains continue to run at an average speed of just 50–51 kmph, falling short of the goals set under Mission Raftar.
  • Mission Raftaar (2016–17 Budget) aims to double freight train speeds and raise passenger train speeds by 25 kmph within 5 years.

What Recommendations Have Various Committees Made to Improve Railways?

• Rakesh Mohan Committee (2010): Emphasized development of long-distance and inter-city transport, including High-Speed Rail corridors.
  • Establishment of National Transport Infrastructure Finance, ensuring neutrality regarding mobility, sustainability, and inclusion goals.
• Kakodkar Committee (2012): Called for establishing a statutory Railway Safety Authority.
  • Proposed a non-lapsable Rashtriya Rail Sanraksha Kosh (RRSK) of Rs 1 lakh crore over 5 years for safety-related projects.
• Bibek Debroy Committee (2014): Recommended creation of a Railway Infrastructure Authority as an advisory body to help the government make informed decisions on issues like promoting competition, efficiency, and economy.
  • Suggested outsourcing of non-core activities (e.g., schools, hospitals) to increase efficiency and reduce operational load on Indian Railways.

Way Forward

• Broaden Freight Portfolio: Focus should be on specialized freight solutions for high-value and sensitive commodities such as pharmaceuticals, electronics, and perishable goods.
• High-Speed Railways: Upgrading railway infrastructure to support speeds of 160–200 km/h could significantly cut travel time, making rail a strong alternative to air travel on key intercity routes.
• Multimodal Logistics Infrastructure: Integrated multimodal logistics parks should be prioritized, featuring automation, smart inventory systems, and smooth intermodal transfers for higher efficiency.
• Private Sector Participation: Indian Railways should boost private participation in areas like rolling stock, catering, and logistics. 
  • Competitive bidding on busy routes can raise efficiency and ease the government's burden.

Drishti Mains Question:

Q. Railways act as an engine for inclusive economic growth and regional development. Discuss.

  UPSC Civil Services Examination, Previous Year Question (PYQ)  

Mains 

Q. The setting up of a Rail Tariff Authority to regulate fares will subject the cash strapped Indian Railways to demand subsidy for the obligation to operate nonprofitable routes and services. Taking into account the experience in the power sector, discuss if the proposed reform is expected to benefit the consumers, the Indian Railways or the private container operators. (2014)