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Indian Railways spent Rs 1,92,446 crore (76 per cent of its Rs 2.65 lakh crore budget) in FY 2024-25. A fresh report by the ministry, in the wake of the upcoming budget, was released recently.
A train moves on a Srinagar-Baramulla railway track (Photo: PTI)
With the Union Budget for FY26 scheduled to be presented on February 1, 2025, there could be some reallocation in expenditure towards rural transfers and welfare spending. According to a report by financial services firm Prabhudas Lilladher (PL), the Centre’s capital expenditure in big-ticket infrastructure projects such as highways, railways and power development are expected to propel India’s economic growth in the financial year 2025- 2026 and beyond.
Amid high expectations, a report with Money Control suggests that the Union Budget 2025-26 is expected to hike the gross budgetary support (GBS) to the Ministry of Railways (Indian Railways) by 15-18 per cent to around Rs 2.9 lakh crore-Rs 3 lakh crore.
Faster capital expenditure spending seen in 2024-25 so far, coupled with the Indian Railways’s plan to take increased deliveries of Vande Bharat trainsets and testing of high-speed rail trainsets in 2025 are the main triggers, the report claimed.
In the budget for 2024-25, the government allocated a massive Rs 11.1 lakh crore for infrastructure projects, and this is expected to be increased further in the forthcoming budget for 2025-26.
The anticipated measures to pump-prime the economy could also provide the much-needed push to stimulate demand and support long-term growth.
HOW MUCH HAS BEEN THE RAILWAY EXPENDITURE?
According to the latest expenditure report of Indian Railways till January 5, 2025, heavy investment is made in capacity augmentation, a reality aiming to make rail travel a world-class experience in India.
With high expectations from the railways, the ministry, in a press briefing, said the railways has spent 76 per cent of its budgetary outlay within the first nine months of the current fiscal.
According to the Railway Ministry, the total capex for railways in the Budget Estimate 2024-25 is Rs 2,65,200 crore with Gross Budgetary Support of Rs 2,52,200 crore. Out of it, Rs 1,92,446 crores have already been spent.
“For rolling stock, the budgetary provision was for Rs 50,903 crores. Out of it, Rs 40,367 crore were spent by 5th January, which is 79 per cent of the budget, allotted for rolling stock,” it said.
“In safety-related works, out of the budgetary allocation of Rs 34,412 crore, the amount spent is Rs 28,281, which is 82 per cent of the allocated amount,” the ministry added.
GOVT PRIORITISES TRANSFORMATION OF RAILWAYS
During the press address, the ministry also said the government has prioritised transforming the railways into a world-class entity, which ferries an average of “2.3 crore Indians” daily at an affordable cost.
It said the fruit of the consistent Capital Expenditure (Capex) for the last decade is visible in the form of 136 Vande Bharat trains, about 97 per cent electrification of broad gauge, laying of new lines, gauge conversion, doubling of tracks, traffic facilities work, investment in PSUs and metropolitan transport.
It also mentioned the ongoing safety and speed trial of Vande Bharat sleeper trains and said rail commuters are all set to experience world-class travel very soon for long-distance journeys too.
“This will revolutionise the overall travel experience. This transformation of Indian Railways would not have been possible without the visionary foresight of Viksit Bharat and its prompt execution by spending on the modernisation projects in a mission mode by Indian Railways,” the press note said.
It added, “Despite challenges like India being the most populous nation with its vast geographical, cultural and linguistic diversity, Indian Railways is implementing a vision of transformative governance to build a new, modern and connected India.”
The semi-high-speed Vande Bharat trains have become a symbol of India’s aspirations for modern, efficient, and comfortable rail travel.
These trains are equipped with top-tier amenities and advanced safety features, such as Kavach technology, 360-degree rotating seats, accessible toilets for Divyangjan, and integrated Braille signages, among many others.
Besides, Indian railways have electrified 3,210 km of rail tracks during the calendar year 2024. The broad gauge network of railway electrification has been extended to 97 per cent, the statement read.
The total capex for railways in Budget Estimate 2024-25 is Rs 265,200 crore with gross budgetary support of Rs 2,52,200 crore.
Out of it, Rs 192,446 crore have already been spent. For rolling stock, the budgetary provision was for Rs 50,903 crore. Out of it, Rs 40, 367 crore were spent by January 5, which is 79 per cent of the budget, allotted for rolling stock.
In safety-related works, out of the budgetary allocation of Rs 34,412 crore, the amount spent is Rs 28,281, which is 82 per cent of the allocated amount, the statement read.
To add to that, Prime Minister Narendra Modi, at the beginning of 2025, inaugurated and laid the foundation stones of multiple railway projects through video conferencing.
Among the key projects, PM Modi inaugurated the new Jammu Railway Division, marking a significant step towards enhanced connectivity in the region.
He also inaugurated the Charlapalli New Terminal Station in Telangana and laid the foundation stone of the Rayagada Railway Division Building of the East Coast Railway.
BIG BOOST TO 3 ECONOMIC CORRIDORS
In 2024, as part of the Centre’s strategy to spur economic growth in the country through big infrastructure projects, a total of 58 railway projects have been sanctioned across three economic corridors, with a combined completion cost of about Rs 88,875 crore and a total track length of about 4,107 kilometres.
According to the year-ender review of the Indian Railways, the projects include Energy, Mineral and Cement Corridors, High Traffic Density Routes and Rail Sagar corridors.
A total of 434 projects have been planned for implementation under these three corridors.
The Energy, Mineral and Cement Corridors accounted for 51 projects, spanning 2,911 kilometres with a completion cost of Rs 57,313 crore.
The High Traffic Density Routes included 5 projects, covering about 830 kilometres and costing about Rs 11,280 crore.
The Rail Sagar corridor covers two projects, with a total track length of about 366 kilometres and a completion cost of about Rs 20,282 crore.
The total Capex for 2024-25 is Rs 2,65,200 crore, which is the highest amount allocated in the budget, till now.
In order to boost investment from industry in setting up cargo terminals along railway lines, Gati Shakti Multi-Modal Cargo Terminals (GCT) are also being developed across the country.
So far, 354 locations (327 on non-railway land and 27 on railway land) have been identified across the country. As many as 91 GCTs have been commissioned this year.
To expedite projects, Indian Railways has also streamlined its project engineering and management processes. All the pending cases of the Engineering Department of various Zonal Railways on Indian Railways E-Procurement System (IREPS) have been disposed of under a “one-time settlement scheme called ‘Vivad Se Vishwas II’ (Contractual Disputes)”.
To address uncertainties in the Engineering Procurement and Construction (EPC) tendering mode, a new ‘Schedule G-1’ has been included for the Bill of Quantities for itemised works, the review stated.
RAILWAY STOCKS DATA IN 2024
Amid an overall low market sentiment, and the anticipations of the upcoming Union Budget 2025, shares of railway stocks have seen a sharp fall from their 2024 record highs.
Specifically looking at the Indian Railway Catering and Tourism Corporation (IRCTC), its shares hit a fresh 52-week-low record of Rs 743.75 on January 13. The stock is around 35 per cent down from its 52-week-high level of Rs 1,139, which it had hit on May 23, 2024.
Notably, international brokerage Macquarie on January 10 initiated coverage on the stock with an ‘outperform’ rating and a target price of Rs 900. This implies an upside potential of 21 per cent from the current levels.