Indian Railways (IR) has emerged as a key contributor to India’s response to the ongoing Covid-19 pandemic. Although the passenger segment has been severely affected by the pandemic, new opportunities have opened up in the freight segment with the introduction of a slew of tariff and non-tariff measures by the government to unlock capacity. With this, IR expects to end the current fiscal year with a surplus from its freight business. The optimism comes in the backdrop of IR’s commitment towards taking a quantum jump in infrastructure development. While presently IR’s network is congested and overutilised leading to slower train speeds and loss of potential revenue, investments have been made in the past few years for capacity enhancement. There has been a significant increase in the number of new line, line doubling and gauge conversion projects being undertaken. Further, markets such as the north-eastern region that have remained underpenetrated for a long time are receiving the required attention. Besides, IR has planned and undertaken several mega projects such as regional rapid transit systems (RRTSs), dedicated freight corridors (DFCs), high speed rail (HSR) corridors and suburban rail projects that will further its infrastructure development plans.
The government has been expanding its capital expenditure on the railway sector, increasing it from Rs 1.56 trillion in 2019-20 to a proposed capex of Rs 1.61 trillion in 2020-21. In 2019-20, the new line, doubling and gauge conversion projects commissioned by IR stood at 2,226 km, which is about 50 per cent more than the average annual commissioning achieved during 2009-14. Besides, during 2019-20, the expenditure incurred by IR on new line, gauge conversion and doubling projects was the highest ever. Further, the electrified network length stands at 39,866 route km (rkm) or 58.49 per cent of the total network as on April 1, 2020. Of this, IR commissioned the electrification of about 4,378 rkm during 2019-20 and aims to achieve 100 per cent electrification by 2023.
IR has accorded the highest priority to safety in train operations through the renewal of tracks, elimination of unmanned level crossings, adoption of new technologies, and undertaking of regular safety audits. In 2020-21, it allocated Rs 50 billion to the Rashtriya Rail Sanraksha Kosh, its safety fund, from its internal revenue. The central government too has allocated Rs 150 billion for this fund. IR has also undertaken the deployment of advanced technologies for enhancing safety such as provision of automatic block signalling, replacement of mechanical interlocking signalling with electronic interlocking, track circuiting, and provision of block proving axle counters, LED colour light signals, train protection and warning systems, online monitoring of rolling stock systems, mobile train radio communication systems, vigilance control devices and global positioning system-based fog pass devices in locomotives.
In addition, IR has introduced several new trains and taken measures for modernisation of its rolling stock. Coach manufacturing activity has picked up across all its production units. The production of old Integral Coach Factory design coaches has been discontinued and IR’s production units have been manufacturing only Linke Hofmann Busch coaches since 2018-19. Several premium trains such as Vande Bharat, Humsafar, Tejas and Antyodaya as well as coaches such as Deen Dayalu and Anubhuti, with improved passenger amenities, have been introduced. India’s first private train – the Lucknow-Delhi Tejas Express – commenced operations in October 2019. The second such train was launched on the Mumbai-Ahmedabad route and began services in January 2020. However, due to the pandemic, the Indian Railway Catering and Tourism Corporation has decided to suspend the operations of these Tejas trains due to low occupancy levels. It will review its decision after observing the occupancy level of other trains operated by IR on these routes.
The scope of public-private partnerships (PPPs) in the railway sector has increased beyond operations and maintenance services. It is now being adopted in areas such as station redevelopment, building of private freight terminals and private train operations. As the investment requirements cannot be met by public sector expenditure alone, the Ministry of Railways (MoR) is looking at PPPs to ensure faster development and completion of tracks, rolling stock manufacturing and delivery of passenger and freight services. As per the National Infrastructure Pipeline, there are plans to privatise 500 trains by 2025. In November 2020, the MoR shortlisted 102 applications eligible for private participation in passenger train services in 12 clusters comprising more than 150 origin-destination pair of trains through the introduction of 151 modern trains. This is expected to entail private investments of Rs 300 billion. Further, the redevelopment of 50 stations on a PPP basis is being taken up on a priority basis. IR is also undertaking the development of the Sonnagar-Gomoh section (263.705 km) of the eastern DFC on a PPP basis.
Recent developments in the light of Covid-19
IR’s focus on digitalisation of operations to improve efficiency and enhance passenger convenience has increased substantially in the past few years. Digital solutions have been deployed in all spheres of its operations, be it passenger information systems, coach factory automation, land management systems, procurement or unreserved ticketing systems. The pandemic has further highlighted the need to adopt digital solutions for smooth day-to-day functioning. Consequently, the use of the railways’ e-office has grown manyfold since the outbreak of Covid-19 in the country. The number of e-receipts increased from 0.45 million during 2019-20 to 1.65 million during April-July 2020. With the aim of reducing human-to-human contact amidst the pandemic, IR is implementing an innovative QR code-based contactless ticket checking system on a pan-India basis. The innovative ticket checking solution has been developed by the Prayagraj division of North Central Railway.
In another development, IR has procured unmanned aerial vehicles for monitoring its assets and ensuring passenger safety. The Railway Protection Force has planned extensive use of drones for the purpose of railway security. IR plans to install artificial intelligence-based surveillance cameras that detect body temperatures and whether a person is wearing a mask or not. It has signed an MoU with RailTel for the installation of an IP-based video surveillance system at 6,049 railway stations across the country. The scope of work includes integration of the existing standalone CCTV network of the railways with the video surveillance system and the setting up of a command and control centre for centralised monitoring.
In addition, in July 2020, IR halted all new infrastructure works included in the Pink Book, 2020-21, till March 2021 due to the financial crunch resulting from the pandemic. Only those works that impact the safe running of trains and are essential and unavoidable are being considered for execution. However, the order does not impact any of IR’s vital infrastructure projects such as 100 per cent electrification of routes; track doubling, HSR, DFC and signalling projects; launch of new modern trains/locomotives, passenger amenities or any project to enhance safety. Besides, there has been no reduction in the capital expenditure for infrastructure works.
Despite the prolonged lockdown and the ongoing pandemic, IR has achieved around 31 per cent of its planned capex during the first five months of the current financial year – April-August 2020. It is committed to meeting the massive network expansion and decongestion targets set for the next few years. The railway sector is gearing up for undertaking huge infrastructure development with the introduction of PPP-based investments. Private train operations are set to begin by April 2023, and will result in a quantum jump in technology induction and coaches that run at higher speeds. Further, big-ticket projects such as the DFC, HSR and RRTS are expected to increase capacity, reduce congestion and reduce unit costs for rail transport. Going forward, there are abundant business opportunities in the sector, particularly in light of the government’s plan to invest about Rs 50 trillion on network expansion and decongestion works till 2030 and the Make in India mandate.