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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.

Review of Financial Performance during the year 2008-09

Freight loading target retained at 850 mt; number of passengers likely to grow by around 7% over previous year.
Implementation of recommendations of VI Central Pay Commission (CPC) likely to cost the Railways Rs 9,000 cr more on staff costs and Rs 4,500 cr more on pensionary charges as compared with previous year.
Hence, Ordinary Working Expenses (OWE) increased to Rs 55,000 cr in the R.E and the appropriation to Pension Fund to Rs 10,500 cr.
Appropriation to DRF retained at Rs 7,000 cr.
Dividend payable to General Revenues kept at Rs 4,711 cr.
Cash surplus before dividend projected at Rs 19,320 cr and the Operating Ratio at 88.3% despite implementation of the VI CPC.
Revised plan outlay kept at Rs 36,773 cr.

Performance Review

The number of consequential accidents came down to 194 in 2007-08.

Agartala, the capital of the Tripura, connected by railway line. First train service in Kashmir valley commenced between Anantnag and Rajwansher. To be followed by Baramulla and Qazigund.
Successful trials completed for running electric locomotives with OHE at a height of about 7.5 mts in preparation for running double stack containers on electrified Western Dedicated Freight Corridor
Work on Eastern Dedicated Freight Corridor commenced near Dehri-on–Son on 10th February,2009. Work on Western DFC to commence this month

Budget Estimates 2009-10

Freight loading targeted at 910 mt – an increment of 60 mt on 2008-09; number of passengers likely to grow by around 7%.
Gross Traffic Receipts estimated at Rs 93,159 cr i.e. Rs 10,766 cr more than RE 2008-09.
Ordinary Working Expenses budgeted at Rs 62,900 cr to cover the full year impact of VI CPC and the payment of 60% arrears due in 2009-10.
Dividend payable to General Revenues kept at Rs 5,304 cr at the current applicable rates.
Plan outlay kept at Rs 37,905 cr.

Passenger Services

43 new train services to be started in 2009-10, extension of 14 trains envisaged and frequency of 14 trains to be increased.


With a view to facilitate improved train operations, it has been decided to set up two new railway divisions at Bhagalpur and Thawe.
25 surveys proposed comprising 14 for new lines, 3 for gauge conversion and 28 for doubling projects.
Pre-feasibility study for running high speed bullet trains being pursued.
Construction of Rail Wheel Factory, Chapra on in full swing; Work on diesel and electric locomotive factories at Marhoura and Madhepura targeted for early start.
Bharat Wagon Limited, Mokama & Muzaffarpur transferred to Ministry of Railways; transfer of wagon units of Burn Standard at Burnpur and Howrah also under consideration on the same lines.

Reduction in Tariffs

Reduction in passenger fares of ordinary passenger trains by one rupee for fares costing up to Rupees fifty per passenger for journey above ten kms.
Second class and sleeper class fares of all Mail/Express and ordinary passenger trains to be reduced by 2 per cent for tickets costing Rupees fifty and more per passenger.
Fares of AC First Class, AC II tier, AC III tier and AC Chair Car also to be reduced by two per cent.

During the last four years Railways have reduced the fares of AC First Class by 28 per cent and AC two tier by 20 per cent. Railways have been greatly benefited by the heavy reduction in passenger fares of these classes. Even as air travel is reportedly reflecting reduction in number of passengers due to economic recession, there has been a significant increase in the number of passengers of these classes on the railways. Therefore, it is decided to reduce the fares of AC first class, AC 2 tier, AC 3 tier and AC Chair Car by 2 per cent.

In the last five years there have been a significant improvement in railway safety and a steep reduction in the number of railway accidents, the minister claimed. The number of consequential accidents came down to 194 in 2007-08, as against 325 in 2003-04. This declining trend is continuing in the current year (2008-09) also as the number of consequential train accidents during April-November has decreased to 117 as compared to 138 during the corresponding period in the previous year.