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The Parliamentary Standing Committee Report on Indian Railways (FY26)
Context:
The Parliamentary Standing Committee on Railways has recommended that the Ministry of Railways focus more on public-private partnership (PPP) projects to reduce its dependence on gross budgetary support (GBS) from the central government.
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The committee highlighted that while the Indian Railways has been receiving record GBS for expanding and modernising its network, it must be more ambitious in attracting private sector investment to reduce dependence on government funds.
Current Scenario
- For FY26, Indian Railways’ annual plan is set at ₹2.65 lakh crore, similar to FY25.
- Over 95% of capital expenditure (Capex) is funded through GBS.
- Less than 5% comes from other sources like Public-Private Partnerships (PPP) or financing via Indian Railway Finance Corporation (IRFC).
Committee Recommendations
- Railways should be more ambitious in promoting private sector participation. Set higher PPP targets to reduce reliance on GBS.
- Explore ways to enhance PPP investments in railway infrastructure.
- Acknowledge that borrowing via IRFC increases financial liabilities due to debt servicing, but encourages finding sustainable investment avenues.
- Accelerate approvals and construction of new freight corridors, and ensure timely completion of existing infrastructure projects.
Accelerating Dedicated Freight Corridors (DFCs)
- Current Status: DFCCIL has submitted Detailed Project Reports (DPRs) for three new corridors: East-Coast Corridor, East-West Corridor, and North-South Sub-Corridor.
- The Ministry of Railways has indicated that these projects’ sanctioning depends on factors like traffic volume, techno-economic feasibility, and financial viability.
- Committee’s Concern & Suggestions: Urged the ministry to fast-track studies to assess feasibility and initiate work on new corridors without delay. Emphasised completing the remaining portion of the Western Dedicated Freight Corridor (WDFC) within the decided time frame to avoid further extensions.
Speeding Up Kavach Deployment
- The Kavach system, an indigenous automatic train protection (ATP) system, has been deployed on 1,465 route km of the South Central Railway and 80 route km of the North Central Railway.
- The committee expressed concerns about the slow deployment of Kavach and called for the speeding up of Kavach-related works to ensure its faster implementation across the railway network.
- It also noted that tenders have been invited for important corridors like Delhi-Chennai and Mumbai-Chennai to expand Kavach’s coverage.
Privatisation of Indian Railways
- Privatisation Goal: The Indian Railways has initiated the process of inviting Request for Qualifications (RFQ) for private firms to operate passenger trains. This will allow private investment for the first time in running passenger trains over the network.
- Trains and Routes: A total of 151 modern, high-speed trains will be introduced, designed for speeds up to 160 km/h. These trains are expected to significantly reduce journey times, aligning with the speed and efficiency of the Rajdhani, Vande Bharat, and Tejas trains operated by Indian Railways.
- Private Sector Role: The private entity will be responsible for financing, procurement, operation, and maintenance of the trains. The trains will be manufactured under the Make in India initiative, ensuring that most components are locally sourced and assembled.
- Long-Term Funding: The government has estimated that ₹50 lakh crore will be needed for Indian Railways’ operations over the next 12 years, and the privatisation of passenger train services is seen as a potential way to meet this funding gap.
