Although revenues in 2020-21 were badly impacted by the pandemic, the railways continued to push ahead with a series of important projects, which will build capacity and improve efficiencies across the network. In 2021-22, freight and passenger traffic also recovered to a large extent, despite the second wave in April-May 2021.
The dedicated freight corridors (DFCs) high speed rail (HSR), and regional rapid transit systems (RRTSs) would vastly improve the load-carrying capacity in the future. Technology and digitisation across all spheres of operations such as passenger information systems, coach factory automation, land management system, procurement and unreserved ticketing have helped impart more efficiency. The gathering of better intelligence will also enable more effective strategising.
The Vision 2024 document outlines 58 “supercritical” projects with a total length of 3,750 km worth Rs 396.63 billion and 68 “critical” projects with a total length of 6,913 km, costing Rs 757.36 billion, for completion by 2024. It targets freight of over 3 billion tonnes by 2030 and over 2,000 mt by 2024.
Apart from the ongoing eastern and western DFC, the ministry is looking at three more DFCs, where DPRs are being prepared. HSRs on Delhi-Varanasi, Delhi-Ahmedabad, Mumbai-Nagpur, Mumbai-Hyderabad, Chennai-Mysore, Delhi-Amritsar and Varanasi-Howrah routes will make travel more competitive vis-à-vis air. More destinations are also likely to be connected to the HSR networks. The RRTS in the National Capital Region could not only service the sprawling four-state metropolitan area, it could serve as a model for other metropolises. New suburban systems in Mumbai, Bengaluru, etc., will ease commuter logistics.
All these projects will provide vast investment opportunities for engineering, procurement and construction players, rolling stock providers, signalling and telecom players, electrification equipment manufacturers and consultants. There will also be demand for technology and equipment providers. The private sector could also find opportunities in the development of private freight terminals, rail-based logistics parks, etc., apart from commercial development around stations, real estate development, multimodal logistics hubs, etc.
The railways is mulling a monetisation plan where IR plans to monetise Rs 1.8 trillion worth of assets. It has planned PPP-based initiatives such as network expansion and the induction of modern rakes to run passenger trains on select routes.
Apart from all the investment opportunities, the railways and ancillary activities could create employment for an additional 1 million individuals. However, IR has to ensure that contracts are clearly drafted and legally enforceable with quantified compensations and speedy dispute resolution systems since this would encourage private sector investment.
The key transporter’s health is directly linked to economic activity and given its steady capacity expansion, it would be well placed to handle the increasing future demand. Innovative policymaking could enable it to become an engine for accelerating growth.