The railway sector has witnessed remarkable progress over the past one year. With record freight loading, electrification and locomotive production, and the integration of technology for ensuring safety, the national transporter has had various achievements. Despite the pandemic, there has been a consistent increase in freight traffic and passenger traffic is recovering with the introduction of more trains. New and innovative ways to improve operational efficiency and the passenger experience are also being focused on. Indian Infrastructure presents the views of leading experts on the railway sector’s progress, the impact of key initiatives, the challenges associated with the sector, and the future outlook…
What has been the progress in the railway sector over the past one year?
I will limit my comments for the present to station redevelopment alone. Station redevelopment, in itself, is a complex subject. The work has to be carried out in a brownfield set-up wherein the station is fully operational, train services are in full swing and safety is to be maintained. In addition, the redevelopment and upgradation of stations is a first-of-its-kind infrastructural activity being taken up by the Indian Railways. Despite this, the Gandhinagar and Rani Kamlapati stations have been successfully redeveloped in the past year. While the former was completed under the engineering procurement and construction (EPC) model, the latter was a public-private partnership (PPP) project. Now that there are two successful examples of station redevelopment, upcoming projects can be executed more efficiently. It is essential that a project is well planned for it to have higher chances of success. Station development is not mere building or real estate development. It is transit-oriented development, which in itself is a new subject in the country, even for development authorities. Till now, Indian Railways (IR) has focused on operations, tracks and bridges, but the redevelopment of railway stations is a completely new subject for IR. This segment will see increased progress in the coming years. There is scope for a lot of capacity building in the segment.
Considering the challenge of private funding, the government is now taking up a lot of station redevelopment work in EPC mode. Tenders have been floated for nearly 50 stations now. The land associated with these projects will also be developed and monetisation of the land will happen later. Nearly 75 stations are being targeted for redevelopment under EPC mode including iconic stations such as New Delhi, Chhatrapati Shivaji Maharaj Terminus, Ahmedabad and Surat.
The performance of IR was spectacular in 2021-22. Gross receipts went up by 36 per cent as compared to 2020-21, while working expenses went up by half of the growth in revenues at 15 per cent. A total of around 1.4 billion tonnes (bt) was carried during the year as compared to 1.2 bt a year earlier. Passenger volumes and revenues went up by 175 per cent and 156 per cent respectively. Passenger revenues are now at around 80 per cent of the pre-pandemic level, while passenger volumes are at 44 per cent. This indicates that IR has chosen the trains and product mix to resume, post the pandemic, in a manner that maximises revenues while meeting the traffic demand. While there is a general perception that the base was low in 2020-21 due to Covid-induced disruption, this was not actually the case for freight traffic. The railways has been seeing a consistent increase in freight volumes, even after the pandemic began. Moreover, revenues from parcel traffic have increased to Rs 17.4 billion, which is quite significant even on an absolute basis and indicates the focus of IR on attracting non-conventional cargo to the railways. During the second wave of the pandemic, IR ran “Oxygen Express” trains across the length and breadth of the country and played a crucial role in meeting the peak demand for oxygen when there was a sudden surge in Covid-19 cases.
Professor G. Raghuram
The past one year was primarily a recovery year following the outbreak of Covid-19. More and more passenger trains were introduced in a considered manner and consequently, passenger movement increased from a low of 230 billion passenger km (bpkm) in 2020-21, compared to an annual traffic of over 1,100 bpkms over the previous seven years. The average freight train speed, which had shot up to over 40 km per hour during 2020-21 (from earlier figures of about 25 km per hour) due to minimal running of passenger trains, stayed the same in 2021-22. Freight loading crossed 1,400 mt, an all-time high, due to post-Covid-19 recovery. Asset modernisation activities such as electrification and electric locomotive production, doubling, and gauge conversion have all exceeded targets.
There has been substantial progress in new project allocations and launching of new trains with higher speeds and electrification of tracks. Some of the key projects under development are the Rishikesh-Karnaprayag rail line project, station redevelopment projects at Ayodhya, Safdarjung, Bijwasan and Gomti Nagar, and various electrification projects. IR achieved record electrification of 6,366 rkm during 2021-22. Meanwhile, 100 per cent electrification of Konkan Railway has been achieved.
IR is also converting its entire network to 1,676 km broad gauge to enhance viability. New and converted broad gauge tracks are being introduced at the rate of 7.7 km per day. In new line/doubling/gauge conversion, 2,904 km was achieved against the target of 2,400 km in 2021-22. Another important development has been in the area of railway safety wherein Safety Integrity Level-4 Certified Technologies have been successfully trialled between Gullaguda and Chitgidda railway stations in South Central Railway.
What has been the impact of the key initiatives taken by the government?
Increased freight traffic and better passenger traffic economics are two obvious impacts of the initiatives taken. While the freight traffic is above pre-pandemic levels and passenger traffic is close to half the pre-pandemic volumes, the number of safety incidents is at around 60 per cent of the pre-pandemic levels. One explanation for this could be the ability of Indian Railways to speed up capital expenditure in the two years following the outbreak of the pandemic, to make improvements in fixed infrastructure. Another major initiative was the change in the model used for railway station redevelopment. Earlier, this was being done under PPP mode, whereby the station building was to be constructed by the private sector for free while exploiting the real estate around the station area. This was, however, not progressing at the desired pace, and the pandemic adversely impacted the real estate market. Currently, station redevelopment is being done under the EPC model and will be funded by the government itself. This might lead to a faster pace of development and improved station infrastructure.
Professor G. Raghuram
There have been many initiatives that are resulting in positive outcomes. The idea of multi modal logistics parks has received a boost and with appropriate penetration, should be a facilitator in enabling aggregation and disaggregation for and from rail-based movement. This should be able to bring long-haul intermediate and manufactured goods traffic from road to rail. The construction of the dedicated freight corridors (DFCs), which is now going at a faster pace, has resulted in significant stretches being opened. In a year or two, the full stretch should be operational. Modernisation of railway stations is beginning to happen after years of discussion. Two stations, at Rani Kamlapati and Gandhinagar, have already been redeveloped. Manufacturing of the Vande Bharat train set had come to a halt due to certain issues with procurement. These were resolved and now 75 train sets are being developed, to be eventually increased to over 400. This will improve the quality and speed of the passenger train service.
The initiative of privatising passenger train operations did not yield anything, since the absence of a regulator was sharply felt. The failure will hopefully become a lesson in taking the initiative forward and making it a success. Zero-based timetabling, and hub- and-spoke operations in passenger trains have not really taken off.
IR is working steadily towards becoming a net zero carbon emitter. In line with this, it is focusing on sustainable and environment-friendly development. Around 71 water recycling plants (WRPs) were set up on IR’s premises up to the year 2018-19. WRPs were commissioned at another 14 locations in 2019-20. Besides this, work is in progress for 27 more WRPs. During 2019-20, rooftop rainwater harvesting systems were installed at 805 locations/on buildings with a rooftop area of more than 200 square metres. Further, 23 railway stations have become net zero carbon emission stations and are meeting their energy needs entirely through either solar or wind power. IR is making concerted efforts to make more stations 100 per cent green powered. During 2019-20, 19.65 MW of solar power and 50.4 MW of wind power was commissioned by IR. Environment-friendly bio-toilets for passenger coaches have also been provided and solid waste management plants have been set up at major railway stations and other locations.
What are the emerging digitalisation and other technology trends?
Various digital initiatives have been deployed in the station redevelopment programme. Right from the design stage, digital tools such as building information modelling have been used.
Tools such as supervisory control and data acquisition have also been deployed for execution and management. The entire building management system is internet based and can be executed and archived with the click of a mouse.
To ensure proper facility and asset management, an application titled Mobile Office was developed and the management was walked through it. It enables functions such as lodging complaints and inspection. Complaints can be registered on the app through scanned QR codes. The status of a complaint is updated once it is addressed. Integrated facility management of five stations was being carried out using the Mobile Office app by the Indian Railway Stations Development Corporation. There are plans to upgrade the system from periodic maintenance to predictive maintenance in the coming years with the help of artificial intelligence. Subsequently, predictions will be made regarding which station area requires more maintenance and when, owing to factors such as passenger footfall.
A positive side effect of the pandemic has been an increase in the digitalised way of working. The e-office model has now been adopted across railway offices, and this is a welcome change in an organisation with an erstwhile prevalence of physical files. This has led to transparency and fewer delays in decision-making. Manufacturing of the old Integral Coach Factory-designed passenger coaches was completely stopped in 2018. All passenger coaches currently manufactured at IR production units are of Linke Hofmann Busch design. They have higher speed potential and are safer. Further, in 2021, the government announced that 75 Vande Bharat trains will be inducted.
Professor G. Raghuram
Digitalisation is a continuous activity in the railways. Signalling improvements, End of Train Telemetry and the anti-collision device called Kavach are important applications in this domain. Improvements in throughput and safety are positive outcomes. Long-length trains such as the Pythons and Vasukis are being run, though they would pose their own challenges in train operations. On the technology front, special purpose wagons, especially if opened up to private party designs, can yield results. Results are visible in automobiles and perishable product movement. High horsepower locomotives (12000 hp) are being manufactured, providing scope to increase trailing loads and freight train speeds, especially on the DFCs. Encouraging start-ups with a railway focus is a welcome new initiative. This should yield results for smart technology-based solutions.
IR is continuously working towards enhancing the passenger experience and freight operations through digital technologies. Constant efforts are being made to increase capacity and enhance the reliability, efficiency and performance of the railways. Transport data is being used to boost rail competitiveness. By consolidating volumes of maintenance data with business processes and IT systems and using cloud computing, manufacturers of rolling stock are now able to offer a number of new digital services such as fault detection, predictive maintenance and simulation-as-a-service. IR is also planning to modernise its signalling system by implementing the modern train control system with the long term evolution-based mobile train radio communication system. Drones are being adopted to monitor railway projects, aid in crowd management and oversee maintenance work. Building information modelling is also being extensively used for designing, planning and construction, and geospatial mapping of railway assets is being carried out.
What are the key challenges that remain unaddressed?
With no precedence for such a model in India, everything has to be done from first principles. The foremost challenge faced during the redevelopment of stations is carrying out construction work in operational railway stations, where routine work requires power/traffic blocks, that is, trains have to be stopped for the duration of the work to avoid disruption of normal train services. Meanwhile, garnering the interest of funders is challenging as no successful model can be showcased. Other challenges include approvals for real estate development, and creating a robust revenue stream as depending merely on real estate is not enough for operations and maintenance.
In order to attract private investments, it is essential that proper concession contracts are formulated with defined revenue stream(s), proper allocation of risks and incentives for timely completion along with penalties for delay. A compensation mechanism should also be in place for not being able to arrange traffic blocks,
which might cause delays in work. Further, for a private model to work, scope for renegotiations after a period of 25 years should be considered.
The freight carried by IR is predominantly “bulk”. These are commodities such as coal, iron ore and petroleum products. As per the National Rail Plan, which was released by the Ministry of Railways in 2021-22, the growth in non-bulk cargo is forecasted to be much higher than that in bulk cargo. Increasing the modal share of railways in the overall freight movement within India will require greater penetration in the non-bulk cargo categories. This is a challenge, as railway policies such as fixed tariffs for a given distance, the minimal size of rakes, lack of rail-based container trains for domestic cargo and inability to ensure timings for freight trains are hindrances. While there is a conscious push to enhance infrastructure through higher capital allocation, changes in soft infrastructure are essential to move to the next level of growth and innovation in the railways.
Professor G. Raghuram
From a supply chain perspective, coordination of train movement between loading and unloading points should become the order of the day. Unloading and destinations do not get as much attention as loading and origins. Further, external coordination with first-mile and last-mile transporters, and then with producers and consumers, is essential. Cadre-based officer-level recruitment has had a two-year holiday. Since the single-cadre Indian Railways Management Service is to be operationalised soon, integration of this cadre into the railway management is a key challenge. And finally, a mindset of continuous improvement is required for technological upgradation, and changes in systems and processes based on market research.
IR needs to work more towards improving passenger comfort and connectivity. If operators want to attract customers back to trains in competition with air travel, it is imperative to adopt 5G. Growing urbanisation and congestion are other issues that need resolution. Increasing the capacity of mass transport is a viable solution to deal with this. One way to augment capacity on existing or new railway lines is to increase the frequency of trains with the help of digital technologies.
What is the sector outlook for the next one to two years?
IR has played and will continue to play a vital role in the country’s progress. As per the targets set by the central government, if India is to become a developed country by 2047, the modal share of railways has to be increased drastically. This increase will require huge investments, to the tune of approximately Rs 8 trillion, in capacity augmentation (tracks, doubling, gauge conversion, first- and last-mile connectivity), rolling stock and infrastructure upgradation.
This investment needs to be drawn not only from taxpayers and rate payers but also from different types of funding and investment models. The sector requires a sustainable financing model for infrastructure development. The sector also requires restructuring of organisations.
The DFCs linking Delhi to Kolkata and Delhi to Mumbai will be fully commissioned in the next two years. This will lead to enhanced capacity for these two critical routes and will also free up the existing railway lines between these cities. New models of private participation in train operations, both passenger and freight, can be experimented with over the next two years. The travelling public can expect to see
sleeker and faster trains as well as modern airport-like stations in the coming years. The freight mix carried by the railways is not expected to change too much in the next two years. There could be possible reforms in the parcel business, helping the railways play a greater role in the e-commerce sector.
Professor G. Raghuram
The outlook for the sector is very positive, with the idea of it being a sunrise sector (espoused even around two decades back) finally coming into reality. The DFCs and Vande Bharat are two key services to look forward to in the freight (with implications for passenger) and passenger sectors respectively. Freight market share should go up marginally, both with increased capacity and a focus on supply chain facilitation.
The National Rail Plan outlines the roadmap for capacity expansion of the railway network by 2030, to cater to growth up to 2050. It envisages the creation of a future-ready railway system that is able to not only meet passenger demand but also increase the modal share of railways in freight to 40-45 per cent from the present level of 26-27 per cent. Going forward, the achievement of this target is necessary to reduce emission levels and enable sustainable development. The NRP also includes an assessment of the rolling stock requirements to meet the twin objectives of 100 per cent electrification and increasing the freight modal share.