Indian Railways (IR) is entering a new phase of transformation. The focus is no longer only on adding new railway lines and trains, but also on improving the capacity, speed, safety and efficiency of the existing network. Large investments in infrastructure are being accompanied by reforms in freight operations, construction and project execution, while modern rolling stock, high-speed rail and technology are changing the passenger experience. Union Budget 2026-27 has provided a capex outlay of around Rs 2.93 trillion for the railways, including a gross budgetary support of about Rs 2.81 trillion.
Freight is another major area of focus. IR aims to increase its share in the country’s overall freight movement to 45 per cent by 2030-31 from around 25-30 per cent currently. During 2025-26, freight loading reached a record 1,670 million tonnes, while freight revenue stood at around Rs 1.78 trillion. Dedicated freight corridors (DFCs), Gati Shakti Cargo Terminals (GCTs), additional freight wagons and simpler tariff structures are expected to support this shift. On the passenger side, Vande Bharat and Amrit Bharat trains, station redevelopment and new high-speed rail corridors are driving a parallel transformation.
Policy initiatives
A key initiative under way is the “52 Reforms in 52 weeks” programme, which aims to make railway operations simpler, faster and more efficient. Most reforms particularly focus on freight transportation to simplify the movement of commodities. Complex tariffs have been replaced with simpler rates for commodities such as fertilisers, foodgrains, flour and pulses. Containerised transportation has also been permitted for these commodities. For fly ash, specially designed ISO-standard containers will allow loading directly at power plants and unloading through side-discharge or pneumatic systems, reducing handling and dust pollution. The policy framework is also giving industries greater flexibility in rolling stock. Oil companies will be able to procure or lease specialised petroleum tank wagons, while manufacturers and industries can propose wagon designs suited to specific commodities.
Construction and tendering processes are being tightened. IR has strengthened contractor eligibility, increased the importance of relevant railway experience, fixed bid security at 2 per cent for specified projects and introduced mandatory work plans before construction. The permissible subcontracting limit has been reduced from 70 per cent to 40 per cent, requiring contractors to take greater responsibility for execution. Additional performance guarantees will apply to bids that are more than 5 per cent below the estimated project cost. The reforms also provide for contractors’ all-risk and professional indemnity insurance. Rail Bhoomi, a web-based platform developed by the Centre for Railway Information Systems, is being used for end-to-end land acquisition management.
Private participation is emerging as a key focus area. IR has proposed changes to its public-private partnership (PPP) policy, including longer concession periods and greater government responsibility for land acquisition. A broader pipeline of 54 PPP projects worth around Rs 1.8 trillion has been identified. At the same time, asset monetisation is being used to support future investment. Under National Monetisation Pipeline 2.0, the railways has been assigned a target of around Rs 2.6 trillion for 2026-30. A 5-10 per cent stake dilution in six railway PSUs is also planned for 2026-27.
Mega programmes gather pace
Dedicated freight corridors: The completion of the western DFC in March 2026 marks a major milestone in India’s rail freight ecosystem. DFCs provide dedicated capacity for freight trains, reducing pressure on existing mixed-traffic routes and allowing passenger services to operate more efficiently.
The next stage will require a corresponding expansion in freight rolling stock. IR plans to procure 100,000 freight wagons worth around Rs 400 billion by 2029-30, while targeting an increase in average freight train speeds to around 50 kmph.
Looking ahead, IR plans to expand the DFC network through three new corridors. The East Coast DFC will connect Kharagpur with Vijayawada, while the North-South DFC will link Itarsi with Vijayawada via Nagpur and the East-West DFC will connect Dankuni with Surat.
High-speed rail: India’s high-speed rail ambitions are expanding beyond the Mumbai-Ahmedabad corridor. Seven new high-speed rail corridors have been planned, covering around 4,000 km with an expected investment of about Rs 16 trillion. The corridors include Delhi-Varanasi, Delhi-Ahmedabad, Mumbai-Nagpur, Mumbai-Hyderabad, Chennai-Bengaluru-Mysuru, Chennai-Hyderabad and Varanasi-Howrah. Meanwhile, the Mumbai-Ahmedabad high-speed rail project continues to advance with expected project completion by December 2029.
In the longer term, IR plans to develop dedicated passenger corridors spanning around 7,000 km by 2047, with operating speeds of up to 320 kmph and modern signalling and operations control systems.
Station redevelopment: The Ministry of Railways launched the Amrit Bharat Station Scheme (ABSS) with a long-term approach to the continuous development and modernisation of railway stations. So far, 1,338 stations have been identified under the scheme. As of July 2026, redevelopment work had been completed at 261 stations, indicating steady progress from planning to execution. The programme is also giving greater attention to incorporating local architectural and cultural features while providing modern passenger amenities. With more than 1,300 stations targeted, ABSS is emerging as one of IR’s largest passenger infrastructure modernisation programmes.
Advancements in rolling stock
IR is steadily modernising its rolling stock, with a growing shift from conventional locomotive-hauled trains towards modern, self-propelled train sets. Vande Bharat remains at the centre of this transition, alongside the expansion of Amrit Bharat services aimed at providing improved long-distance travel at an affordable cost.
So far, IR has operationalised 162 Vande Bharat trains, 2 Vande Bharat Sleeper trains and 72 Amrit Bharat trains. The broader programme envisages 200 Vande Bharat trains, 100 Amrit Bharat trains and 50 Vande Metro trains by 2027-28. The next generation of these trains is also being planned, with Vande Bharat 4.0 expected to bring further improvements and potential export opportunities, and Amrit Bharat 4.0 being developed as a next-generation train set and locomotive platform.
The transition from conventional Integral Coach Factory coaches to safer and more modern Linke-Hofmann-Busch (LHB) coaches is also continuing. More than 23,000 conventional coaches have been replaced since 2015, taking the cumulative LHB production beyond 42,600 units by 2025. During 2026-27, about 1,107 LHB coaches had been produced up to June.
At the same time, the rolling stock manufacturing ecosystem is becoming more domestic and diversified. Greater private sector participation in wagons, locomotives, train sets and components is supporting the expansion of manufacturing capacity, while policy support for products such as wheels, brakes and transmission systems is expected to reduce import dependence and strengthen the domestic railway supply chain.
Strengthening safety through technology initiatives
Safety remains a key focus for IR, with increasing reliance on advanced signalling, inspection and maintenance technologies. At the centre of this effort is Kavach 4.0, India’s indigenous automatic train protection system, which is being deployed across high-density railway routes.
As of July 2026, Kavach 4.0 had been commissioned across 2,633 route km on the Delhi-Mumbai and Delhi-Howrah routes. Its wider deployment is supported by the installation of optical fibre cables, trackside equipment, telecom towers, station data centres and onboard equipment on locomotives. IR is also working towards Kavach 5.0 for Mumbai’s suburban network, extending automatic train protection to one of the country’s busiest rail systems.
Technology is also being brought into track inspection and maintenance. IR plans to deploy artificial intelligence (AI)-enabled ground penetration radars in inspection vehicles to assess the condition of the track base. Advanced composite sleepers are being considered for bridge approaches, points and crossings, while magnetic particle testing is being used to identify small defects in welded rail joints.
Together, these initiatives mark a shift towards technology-led and predictive maintenance, allowing potential safety issues to be identified earlier and reducing dependence on conventional inspection methods.
Electrification and green transition
IR is now close to completing the electrification of its broad gauge network. As of June 30, 2026, 70,084 route km had been electrified, representing 99.6 per cent of the broad gauge network. This provides a strong base for reducing diesel dependence and improving energy efficiency. The next stage is increasingly focused on renewable energy. As of June 2026, IR had commissioned 1,161 MW of solar capacity and around 103 MW of wind power capacity.
Hydrogen-powered trains are another emerging area. A hydrogen train using a 1,200 kW hydrogen fuel cell propulsion system has been launched on the Jind-Sonipat route in Haryana. IR has set a longer-term target of developing 50 hydrogen trains by 2047, although the technology remains at an early stage of deployment.
The green transition is also influencing station development, with sustainable and energy-efficient solutions increasingly being incorporated into redevelopment projects.
The way forward
IR is entering a phase where capacity creation will need to be matched by better asset utilisation, faster project execution and greater operational efficiency. The expansion of DFCs, GCTs, freight, rolling stock and passenger corridors will be important for increasing the role of rail in both freight and passenger mobility. At the same time, greater private sector participation, technology adoption and domestic manufacturing will shape the next phase of growth. Modern trains, Kavach, AI-based inspection and digital systems are gradually changing the way the network is built and operated. With broad gauge electrification nearing completion, increasing renewable energy use and cleaner technologies will further support the sector’s sustainability goals.
The larger objective is to build a railway that is faster, safer, more efficient and commercially competitive. Achieving this will depend on sustaining investment while ensuring that new infrastructure and assets translate into higher freight volumes, greater passenger capacity, improved safety and better service quality.
Simran Kaur
