Indian Railways (IR) has made notable progress over the past year, driven by its sustained focus on infrastructure expansion, electrification, safety enhancement, and passenger-centric services. Over 3,400 km of new tracks have been operationalised, more than 3,000 route km have been electrified, and advanced safety systems like Kavach 4.0 have been rolled out. Record levels of capital expenditure have supported flagship projects such as the Amrit Bharat Station Scheme (ABSS), Vande Bharat trains, and dedicated freight corridors (DFCs). That said, challenges persist. These relate to timely completion of projects, last-mile connectivity and deployment of safety technologies. Industry experts share their views on the sector’s progress, key bottlenecks and the way forward…
What has been the progress in the railway sector over the past one year? What have been some of the notable developments?
Jay Bardhan
Over the past year, IR has witnessed significant progress and modernisation on multiple fronts. Over 6,000 km of track renewal was completed, while more than 3,000 route km (rkm) was electrified. Over 95 per cent of the IR network is now electrified. Train speeds have also been increased to 130 kmph on key routes, enhancing both efficiency and passenger convenience.
In terms of new services, more than 100 Vande Bharat trains were introduced, along with the launch of the first Namo Bharat Rapid Rail. Further, to meet seasonal travel demands, IR operated over 21,000 special train trips during the year.
Notable upgrades have been made to passenger amenities under the ABSS, which aims to modernise and enhance station infrastructure and services. Urban transit has also expanded, with significant growth in metro networks across cities such as Delhi, Mumbai, Gurugram, Pune, Bhopal, Indore and Bengaluru. In addition, detailed project reports for proposed metro networks in cities such as Coimbatore and Madurai in Tamil Nadu, and Rajkot and Vadodara in Gujarat, were submitted to the centre for approval.
“A crucial gap is the need for greater private investment and more robust PPP models, where participation has so far been minimal.” Jay Bardhan
Aniruddha Kumar
In the past one year, the IR sector has seen significant infrastructure expansion and operational improvements. Key achievements include the commissioning of 3,433 km of new tracks (1,158 km of new lines, 259 km of gauge conversions and 2,016 km of multi-tracking), 6,450 km of complete track renewals, 8,550 turnout renewals, and speed upgrades to 130 kmph over 2,000 km. Freight loading grew by 5.2 per cent and passenger traffic by 8 per cent, supported by a record capital expenditure of Rs 2.62 trillion, with over 85 per cent utilisation in the previous fiscal.
IR electrified 2,701 rkm of broad-gauge track during FY 2025, bringing the total electrified length to 68,701 rkm by the end of March 2025. By March–July 2025, around 98–99 per cent of the broad gauge (BG) network was electrified; taking the cumulative electrification to around 69,102 rkm (including DFCs), with around 6,150 rkm pending.
- Safety technology – Kavach 4.0 moves from trials to service: After independent safety approval in May 2025, Kavach 4.0 was commissioned on the busy Mathura–Kota (324 rkm) section (Delhi–Mumbai corridor). Further, tenders are already awarded/underway for around 3,000 rkm on the Delhi–Mumbai and Delhi–Howrah routes, with further expansion planned.
- Freight growth continues despite coal softness: In FY 2025, freight loading crossed the previous year’s level. By March 2, 2025, IR had loaded around 1,465 million tonnes. During Q1 FY 2026, freight volumes were up by 2 per cent year on year to 413 million tonnes. Moreover, the records of South East Central Railway (SECR) and South Eastern Railway (SER) demonstrated sustained productivity.
- Rolling stock and Make in India: Alstom delivered the 500th WAG-12B (12,000 HP) locomotive in March 2025. Following this, Siemens delivered the first 9,000 HP freight loco under the 1,200-unit Dahod contract in May 2025.
- Stations and passenger experience: The ABSS gathered pace. Around 103 redeveloped “Amrit Stations” were inaugurated on May 22, 2025 in one tranche. Rail Madad adoption and response service level agreements improved across zones.
“The sector outlook is optimistic, with India poised to become the third-largest railway market globally in the next five years.” Aniruddha Kumar
Karun Raj Singh Sareen
Over the past year, Indian Railways (IR) has seen significant progress, driven by strong government investment. Capital expenditure in the railways sector has increased substantially, almost doubling from Rs 1.48 trillion in 2019-20 to Rs 2.65 trillion (revised estimate) in 2024-25. Revenues have also reached record levels. In 2024-25, IR posted its highest-ever revenue of around Rs 2.7 trillion, with Rs 1.75 trillion coming from freight operations. However, the railways share in total freight transport is at a modest 26 per cent, prompting efforts under the National Rail Plan to raise this to around 40-45 per cent.
Manufacturing has seen notable growth as well. To meet rising demand, significant investments have been made in rolling stock, including the deployment of Vande Bharat trains. Between 2023 and 2025, around 150 indigenously manufactured Vande Bharat trains have been launched.
Infrastructure development has also advanced, especially in freight. The DFC has seen 100 per cent completion of the Eastern DFC and about 94 per cent of the Western DFC (WDFC), bringing the overall DFC progress to around 96 per cent.
“Freight transport demand is expected to grow six-fold, and IR is aiming to substantially increase its modal share. This presents a massive investment opportunity across infrastructure, rolling stock and logistics.” Karun Raj Singh Sareen
How would you assess the progress of government programmes and initiatives for railway modernisation? What more needs to be done?
Jay Bardhan
The government’s programmes and initiatives, aimed at modernising the railway sector, have made notable progress in recent years. Key schemes such as the ABSS and the Kavach safety system are advancing well, with steady improvements in electrification and rolling stock modernisation. The indigenous Kavach train protection system is being deployed across various routes, but its adoption is not yet widespread.
Meanwhile, the implementation of safety technologies and the development of DFCs have been slow, impacting the efficiency and safety of both passenger and freight services. Funding gaps continue to hinder the execution of many initiatives. Metro projects such as the Noida metro, Gurugram metro and the Delhi-Gurugram-Shahjahanpur-Neemrana-Behror regional rapid transit system have faced delays, slowing down the expected improvements in urban mobility.
Aniruddha Kumar
The key initiatives that have benefitted the sector include:
- Electrification and interlocking: Momentum in electrification, coupled with electronic interlocking at over 6,600 stations, reduces diesel dependence and human-factor risks.
- Safety capex and ATP: The accelerated roll-out of Kavach 4.0 on trunk corridors, backed by budgets and tenders, represents a structural upgrade in safety.
- High, steady capex: The Union Budget 2025-26 has retained a large capital outlay for railways, supporting DFC last-mile works, rolling stock, station upgrades and signalling.
Despite ongoing efforts, focus in the following areas in the near term will further sector progress: - Completing the remaining 6,000 rkm of electrification and ensuring overhead equipment (OHE) reliability in humid/coastal and heavy-haul territories.
- Rolling out Kavach in a time-bound manner to all Golden Quadrilateral/diagonals and fog-prone sections; aligning original equipment manufacturers (OEM) capacity, spectrum/LTE backbone and certification pipelines.
- Addressing throughput concerns through accelerated yard remodelling, automatic block signalling, longer loops (1.5–2 km), and terminal capacity augmentation via the Gati Shakti Cargo Terminal (GCT) model.
Karun Raj Singh Sareen
The government’s initiatives for railway modernisation have made commendable progress across several key areas, but certain challenges remain that need to be addressed.
- Station infrastructure: Under the ABSS, about 1,300 out of the total 7,000 railway stations have been identified for modernisation, with six major stations already inaugurated across Madhya Pradesh, Gujarat, Karnataka and Uttar Pradesh. While the original plan aimed to use the public-private partnership (PPP) model, most projects are now being executed through the engineering, procurement and construction (EPC) route.
- Sustainability and indigenisation: Nearly 99 per cent of the rail network is now electrified, a major milestone towards achieving net-zero emissions. Diesel locomotives are being phased out in favour of electric alternatives. All Vande Bharat trains are being manufactured indigenously, supporting the “Make in India” initiative and enhancing operational capacity with higher speeds and advanced technology.
- Safety: Kavach, an indigenous automatic train protection system, is being deployed across the network. So far, it has been installed on approximately 2,500 km of track, with plans to extend it to 10,000 locomotives and 15,000 km, with active private sector participation.
What has been the private sector’s experience?
Jay Bardhan
The private sector’s involvement in the railway sector has grown significantly, particularly in areas such as freight terminals, locomotive and other rolling stock manufacturing, and passenger services such as the Tejas Express. These developments signal a positive shift toward privatisation and improved efficiency. However, challenges remain for private players, particularly in ensuring route profitability, navigating regulatory complexities and balancing public service obligations and commercial objectives.
Despite this progress, private participation in public-private partnership (PPP) schemes for infrastructure development, such as new lines, doubling or third lines, has been minimal. A key reason is the lack of a clear, robust policy from IR, which has discouraged private investment in such ventures. On a positive note, captive sidings have been performing well. However, there has been no participation from the private sector in metro train operations as of now.
Aniruddha Kumar
- Strong in freight and manufacturing: Private players are active in Gati Shakti cargo terminals, container train operations, wagon procurement/leasing and locomotive manufacturing (Alstom WAG-12B; Siemens 9,000 HP at Dahod), with long-horizon maintenance contracts that ensure technology transfer and uptime.
- Station PPPs are selective: Brownfield complexity and footfall-mix economics mean that only the most bankable stations progress to public-private partnerships (PPPs); others proceed via EPC under ABSS. While the policy thrust remains, risk-sharing and real-estate monetisation are key to scaling up.
Karun Raj Singh Sareen
The experience of the private sector in the IR ecosystem has been mixed, although there is cautious optimism for the future. Private participation has grown notably in areas such as logistics, with several Gati Shakti cargo terminals being developed under the PPP model. Additionally, around 75 out of the planned 100 private container terminals are already operational. Rail connectivity projects have also seen PPP engagement, and in manufacturing, private players are significantly involved in producing wagons, Vande Bharat trains and locomotives. A draft PPP policy is also under discussion to provide greater support and confidence to investors, especially for last-mile connectivity projects under the Gati Shakti Master Plan.
In terms of train operations, efforts to privatise services, such as through the Tejas trains, have seen partial success. While broader private train operations have not materialised due to failed tenders, Indian Railway Catering and Tourism Corporation’s (IRCTC) operation of Tejas represents a positive step towards private involvement.
How is digitalisation transforming operations and asset management?
Jay Bardhan
Digitalisation is gradually transforming operations and asset management within the sector, although progress has been slow. Digital tools have an immense potential to revolutionise asset tracking, predictive maintenance and passenger services, but their implementation has not yet reached full scale. Advanced technologies such as artificial intelligence, internet of things and 3D modelling are enhancing fleet management, signalling systems and infrastructure planning, enabling greater precision and efficiency. Additionally, the introduction of automated ticketing systems has streamlined passenger services, improving convenience and reducing human error. Digital platforms for freight logistics have significantly improved the efficiency of cargo handling, while digital systems for passenger feedback are now well-established, helping authorities assess service quality and make improvements.
Aniruddha Kumar
Digitalisation is revolutionising Indian Railways with the integration of internet of things, artificial intelligence (AI), digital twins and centralised traffic control systems for predictive maintenance, real-time asset management and reduced operational hazards. This has enhanced efficiency in signalling, passenger information and freight tracking, while enabling new revenue streams through data-driven insights.
- Real-time fleet visibility: IR’s real-time train information system, developed with ISRO, now covers thousands of locomotives; GPS feeds into the Control Office Application/National Train Enquiry System, enabling accurate public running information and effective control-room decision-making.
- Safety and headways: Kavach 4.0 introduces automatic train protection (ATP), signal passed at danger (SPAD) protection and auto-braking. Once scaled across the quadrilateral corridors, it is expected to significantly reduce collision risk and improve headways.
- Customer service digital rails: Rail Madad grievance analytics indicate shorter pendency periods and higher satisfaction across zones, supporting targeted station/coach upkeep.
Karun Raj Singh Sareen
Digitalisation is expected to play a transformative role in enhancing both operations and asset management. On the operational front, real-time tracking of trains and wagons has improved significantly. Global positioning system (GPS) and asset-tracking devices enable precise monitoring of the location and status of locomotives and freight, which enhances punctuality and transparency. Currently, around 70 per cent of locomotives are GPS enabled. Customer experience has also improved with digital tools such as IRCTC and Unreserved Ticketing System mobile applications.
In asset management, digitalisation offers the potential for cost optimisation through predictive maintenance. IR is gradually adopting internet-of-things devices and data analytics to enable smarter maintenance strategies, though this remains work in progress. Another critical area is project execution. Technologies such as light detection and ranging (LiDAR) surveys and integrated project management systems are being introduced to monitor progress, manage contractors and identify bottlenecks. In future, technologies like artificial intelligence and machine learning could further streamline resource allocation, financial tracking and execution, as seen in other infrastructure sectors.
What are the key challenges that remain unaddressed?
Jay Bardhan
Several key challenges remain largely unaddressed. Safety upgrades, ageing infrastructure and land acquisition delays are major concerns. Such delays hamper project timelines and efficiency, further compounding the sector’s challenges. Additionally, the financial strain caused by cross-subsidisation and the absence of independent regulatory frameworks limits operational efficiency.
A crucial gap is the need for greater private investment and more robust PPP models, where participation has so far been minimal. Only Pune (currently under construction) and Hyderabad have seen private investment in metro projects, indicating a lack of widespread adoption of PPPs across the country.
Another pressing issue is the inadequate focus on last-mile connectivity for urban infrastructure projects. Feeder routes for metro systems have not received sufficient attention, leaving many urban areas poorly connected to metro lines. Similarly, personal rapid transit, which have been discussed for years, are still far from becoming a reality, further delaying the implementation of a comprehensive urban transport network.
Aniruddha Kumar
- Safety gap until Kavach is ubiquitous: While Kavach 4.0 has gone live on the Mathura–Kota route, nationwide coverage will take time. In the interim, risks persists on high-density, mixed-traffic sections.
- O&M and skills: Rapid technology infusion including ATP, electronic interlocking, train management system/control office application, head-on generation (HOG), requires accelerated staff training, spare-parts ecosystems and cybersecure communications backbones to avoid downtime.
- Execution variability: Electrification is near-complete, but the “last mile” of around 6,000 rkm lies in challenging geographies. Maintaining pace and quality while managing block availability remains difficult.
- Other key challenges: Persistent issues include land acquisition delays that hinder bidding and project timelines, cash flow constraints and payment delays for contractors. Additionally, price variation terms aligned with market trends should be allowed in bids to reduce risks at both bidding and execution stages. Furthermore, competitive bidding pressures leading to unbalanced price bids due to the entry of non-railway bidders need to be addressed.
Karun Raj Singh Sareen
Several key challenges in the sector continue to remain unaddressed. These challenges can be grouped under three broad themes:
- Cultural barriers to change: One of the most significant, yet difficult-to-solve challenges is fostering cultural adaptability, given its legacy character, well established structures and long-standing ways of functioning. To improve efficiency, the sector must quickly adopt modern practices and a nimbler approach of functioning.
- Delays in project execution: While large-scale investments are being made, execution remains a bottleneck. Regulatory complexities, land acquisition issues and long project approval timelines continue to hamper progress. Unlike sectors such as roads, PPPs in railways remain less attractive due to limited operational control, bureaucratic hurdles and sustainability challenges. For example, the WDFC has been delayed by four to five years. Similarly, the high-speed rail (HSR) project, initially targeted for 2026, is likely to face delays.
- Financial instability: IR remains heavily dependent on government budgetary support, with limited internal revenue generation. A major reason is cross-subsidisation, where freight revenues support passenger services. This distorts pricing, increases the operating ratio, and limits competitiveness.
What is the sector outlook? Which areas hold the potential for higher growth and investments?
Jay Bardhan
The outlook for IR remains strong, driven by a focused agenda on electrification, high-speed rail and station modernisation. These initiatives are expected to significantly transform the sector in the coming years, improving efficiency, sustainability and passenger experience. High-growth areas, with substantial potential for investments, include rolling stock manufacturing, DFCs and the expansion of urban metro networks. The growing emphasis on digital platforms presents more opportunities for innovation and investment.
Logistics and multimodal integration of transportation systems will be key growth areas, as the need for seamless and efficient movement of goods and passengers becomes increasingly important. The Make in India initiative is expected to attract significant investment in domestic manufacturing, especially in rolling stock and related infrastructure.
Aniruddha Kumar
The sector outlook is optimistic, with India poised to become the third-largest railway market globally in the next five years, backed by investments of Rs 5.4 trillion by 2030.
- Safety and signalling: Large-scale investments in Kavach 4.0, LTE-R/optical backbones, interlocking upgrades and automatic signalling represent the single biggest structural lever for enhancing capacity and safety.
- Freight corridors and connectors: Completion of DFC interfaces, along with the development of high-throughput port/industry spurs and private GCTs will unlock sustained freight growth and improve asset turnover.
- Rolling stock: Expansion of 9,000–12,000 HP electric freight locos, high-payload wagons and maintenance depots under long-term performance contracts will be critical.
- Stations and passenger product: Continued ABSS roll-outs, with a focus on multi-modal access, retail integration, universal accessibility, and premium/sleeper semi-high-speed services on key corridors.
- Green railways: Net-zero emissions through HOG expansion, rooftop/trackside solar, energy storage at traction substations, and regenerative braking analytics, which will enable bankable decarbonisation projects.
Karun Raj Singh Sareen
The overall outlook for the sector remains positive, driven by strong government focus and sustained investment. Several factors contribute to this optimistic outlook.
First, passenger demand is set to grow, driven by increasing urbanisation. As the share of the urban population is projected to rise from the current 34 per cent to 50 per cent by 2047, demand for efficient and affordable public transport will increase significantly.
Second, freight transport demand is expected to grow six-fold, and IR is aiming to substantially increase its modal share. This presents a massive investment opportunity across infrastructure, rolling stock and logistics.
Third, railways hold a clear advantage in environmental sustainability. Compared to air and road transport, rail is far more eco-friendly. With growing global focus on climate change, rail will become a preferred mode for both passenger and freight movement.
To meet this rising demand, the rail network is expected to double from 109,000 km to 200,000 km. Furthermore, detailed project reports have been submitted for three new DFCs, while the HSR network is targeted to be scaled to 7,000 km by 2047. This opens up significant opportunities for PPPs, as the government alone cannot meet the massive investment requirements.
