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generates a cash surplus before Dividend of Rs. 20,000 crore in fiscal* 2006-07 signifying an impressive Rs. 5300 crore in a year from Rs 14,700 cr. in the previous fiscal.

"The freight impact on industry is in the right direction and the general approach of the budget is to improve efficiency and output. The minister is taking innovative measures and if this tempo continues Railways will be one of the pillars of our growth in the coming years."  J. P. Choudhary, Chairman, CII-Railways Equipment Division

"The Railways are now working like a private sector corporation. We wish other public services, especially in the social sector, like education and health would follow suit," Habil Khorakiwala, President, FICCI

"The Budget proposal would give enough encouragement for huge capacity building of steel, cement and coal sectors." - Venugopal N Dhoot, President, ASSOCHAM

“The budget truly heralds a modern approach to managing the largest public service through use of technology and innovation.” - R.Seshasayee, President, CII

*India's fiscal year begins on April 1


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Railways to invest Rs. 230,000 cr in 11th Plan

INDIAN Railways will invest Rs. 2,30,000 crore under the 11th Five Year Plan which is almost three times the amount allocated in the 10th Five Year Plan, this is disclosed by country’s Railways Minister Lalu Prasad while presenting the Interim Budget for fiscal 2009-10. As India’s general election to country’s Parliament is around, the minister submitted the interim budget for first four months of next fiscal. The Railways have deployed their investible surplus of nearly Rs. 70,000 crore earned between 2004-05 to 2008-09 to increase its productivity.

The objective of larger investment is to increase the transport capacity of the Railways and to reduce the unit cost of operations. Railways’ investment outlays have been stepped up from Rs.13,394 crore in 2003-04 to Rs. 36,773 crore in 2008-09. Railways would be completing the work of 4900 kms of gauge conversion, 1800 kms of doubling and laying 1100 kms of new lines, over five years.

A pre-feasibility study to run bullet train between Delhi and Patna will soon be started. In addition to the bullet train proposals between Delhi-Amritsar, Ahmedabad-Mumbai-Pune, Hyderabad-Vijayawada-Chennai, Chennai-Bangalore-Ernakulam and Howrah-Halida which were announced in 2007-08 Railway Budget. The action for examining feasibility study is already on for these routes.

Meanwhile, the has announced reduction in passenger fares for non sub-urban mail/express and ordinary passenger trains by one rupee for fares costing up to fifty rupees per passenger. Since the fare for rail travel for 10 km and below has already been reduced from four rupees to one rupee, this reduction will not be applicable for second class rail journey up to 10 km. Railways decided to reduce the second class and sleeper class fares of all mail/express and passenger trains this year to fulfill the aspirations of the long distance passengers. More................

Indian Railways plans Rs 37,500 crore investment

INDIAN RAILWAYS has taken up biggest ever annual plan for the Railways in fiscal 2008-09 entailing massive investment to the of Rs. 37,500 crore signifying 21 percent increase over previous year. The plan, tabled by country’s Railway Minister during his 2008-09 Budget speech on February 26 includes a total budgetary support of Rs. 7874 crore including Rs. 774 crore to be provided from the Central Road Fund. The annual plan will have Internal and External Budgetary Resources (IEBR) funding of 79%.

Under this plan, priority has been given to enhancement of rail capacity, modernization of the railway, throughput enhancement on High Density Network routes, traffic facility works and expansion and development of the network. Construction of flyovers, bypasses, Intermediate Block System (IBS), upgradation of goods shed etc., traffic facilities works will be completed on priority.

The outlay for doubling works has been increased to Rs. 2,500 crore, traffic facility works to Rs. 984 crore and an outlay of Rs. 1535 crore has been proposed for projects under implementation by Rail Vikas Nigam Limited (RVNL). Provision of Rs. 1730 crore for new lines, Rs. 2489 crore for gauge conversion, Rs. 626 crore for electrification and Rs. 650 crore for Metropolitan Transport Projects has been made.


To sustain magical turnaround in Railway’s performance a ‘Vision 2025’ document would be finalized within six months. The document will set forth targets for the coming 17 years for operational performance and upgradation of services. It will also have a detailed action plan for achieving the stipulated targets and necessary investment plans thereof.

The proposed document would also contain details of customer-centric modern passenger services and various freight schemes to sharpen the competitive edge of the railways. Route wise planning would be done to reduce traffic bottlenecks, expand the network and modernize the railways. Passenger services will be governed by two words - ‘comfort and convenience’. A multi-departmental innovation promotion group will also be set up in the Railway Board. All Railway employees and citizens will be able to send their innovative suggestions to this group. The proposed initiatives would inspire the Railway management and its employees for new experiments and would lay a solid foundation for resurgent Railways

On safety related plan heads, provision has been made for Rs. 3600 crore for track renewals, Rs. 1520 crore for signal and telecommunication works, Rs. 700 crore for Road Over Bridges and Road Under Bridges and Rs. 600 crore for manning of unmanned level crossings. The Railway Minister also sought additional funds to the tune of Rs. 1712 crore from Ministry of Finance for national projects of Udhampur-Srinagar-Baramulla, Jiribam-Imphal Road, Dimapur-Kohima, Azra-Byrnihat and Kumarghat-Agartala new line, Bogibeel Rail-cum-Road Bridge and Lumding-Silchar-Jiribam, Rangia-Murkongselek gauge conversion.

During the year 2300 km broad gauge lines are likely to be completed. The target for construction of broad gauge lines in 2008-09 is 3500 km. The construction of new line between Kakapore and Badgam in the Kashmir valley has already been completed and the remaining portion in the valley will be completed in 2008-09. Expressing gratitude to the Hon’ble Prime Minister for deciding the funding of National Projects in the North Eastern region, through 25 percent funds from Railways Gross Budgetary Support and balance 75 percent as an additionality, he proposed to create a non-lapsable Northeast Rail Development Fund to expedite track construction process in this region. 

Rs 75,000 cr for line capacity expansion

An investment of Rs.75,000 crore will be made over the next seven years to augment line capacity on identified routes to create the required capacity for carrying an additional 310 million tones freight traffic. A blue print on the route-wise detailed study has been prepared and accordingly, route-wise works would be undertaken in a phased manner. This would include 124 works of doubling, third and fourth lines, bye-passes, flyovers, crossing stations, intermediate block stations, automatic signaling works and yard re-modelling.

These works include construction of the Eastern and Western Corridors and informed that 104 throughput enhancement works, already in progress, would be completed over the next two years.The entire network would be provided with Intermediate Block Stations (IBS) by March next year.

Reduction in passenger fare

The Railways have reduced passenger fares of various classes while introducing the Railway Budget for 2008-09 in the Lok Sabha today. There will be a reduction of one rupee in the second-class fares of up to rupees fifty for non-suburban mail/express and ordinary passenger trains. The second-class fares of all mail/express and ordinary trains will be reduced by 5% for the tickets costing more than fifty rupees per passenger to benefit long distance passengers.

The Railway Minister also announced a reduction in the fares for newly designed Sleeper Class coaches by 2%. Fare reduction by 2% for the newly designed AC 3 tier and AC Chair Car coaches has also been announced. This reduction will be only half for popular trains and during the peak period.

To make the fares for higher classes more competitive, the Railway Minister announced reduction of fares for AC-I class by 7% and AC-2 tier by 4%. This reduction would only be half for popular trains and during the peak period. With this reduction, the process of rationalization of AC class fares has now been completed.

Source: Press Information Bureau, Ministry of Information and Broadcasting Government of India