The Union Budget 2025 has left rail sector analysts, industry experts, and markets underwhelmed as it failed to deliver the expected capital expenditure (capex) push for Indian Railways (IR). Despite expectations of a significant boost, the government maintained last year’s allocation of ₹2.62 lakh crore, signaling a pause in its aggressive expansion strategy.
Railways No Longer a Budget Highlight
Once a grand event with a separate Railway Budget, Indian Railways has now been reduced to a footnote in the general Budget since their merger in 2017. This year, IR was barely mentioned in the Budget speech, reinforcing concerns about its declining priority in national economic planning.
Massive Investments, Minimal Returns
Over the past decade, ₹13 lakh crore has been pumped into railway infrastructure, leading to 95% electrification, expanded track length, and record additions to rolling stock. However, the financial returns remain underwhelming. Freight traffic is growing at just over 2% annually, despite India’s booming economy, and passenger numbers have yet to return to pre-pandemic levels. The Budget also failed to address past promises or discuss new measures to boost revenue and efficiency.
Railways Minister’s Post-Budget Assurances
In a post-Budget press conference, the Railways Minister highlighted the government’s focus on infrastructure development, station modernization, safety measures, and new railway lines. He announced that safety-related initiatives would receive ₹1.16 lakh crore, but there was no mention of expanding Kavach, the country’s indigenous train collision avoidance system. Since its initial rollout over 1,465 km, no further expansion has taken place.
Delayed Station Redevelopment and High-Speed Rail Projects
The much-publicized Amrit Bharat Station redevelopment plan is progressing slowly, with only a handful of stations—Gandhinagar, Habibganj, and Ayodhya—showing tangible improvements. The long-delayed modernization of New Delhi Railway Station remains stuck in bureaucratic hurdles, raising concerns about project execution efficiency. Similarly, major infrastructure projects like the Mumbai-Ahmedabad High-Speed Rail and the Western Dedicated Freight Corridor received no fresh updates.
Electrification vs. Efficiency: Is the Strategy Misplaced?
The government touted its achievement of electrifying 294 route kilometers per year since 2014, aiming to make IR the world’s first fully electrified railway network. However, this aggressive push has rendered nearly 5,000 diesel locomotives worth ₹30,000 crore idle or underutilized. Additionally, most of IR’s electricity supply still comes from fossil fuel-based power plants, raising doubts about the actual environmental benefits.
Grand Announcements Without a Roadmap
While the government announced plans to introduce 200 more Vande Bharat trains, no timeline was provided. Similarly, an ambitious vision to build a 7,000-km high-speed rail network by 2047 was presented, but with no clear funding or execution strategy, making it appear more aspirational than realistic.
Freight Targets: A Numbers Game Without a Concrete Plan
A major claim in the Budget was that IR would become the world’s second-largest freight carrier, reaching 1.6 billion tonnes of cargo. However, with declining freight share and slow train speeds, the government has yet to outline how it plans to achieve this goal.
Conclusion: No Transformational Reforms, Just Status Quo
For another year, the Budget suggests that Indian Railways is merely maintaining operations rather than undergoing meaningful transformation. Without structural reforms, enhanced efficiency, and improved financial health, IR risks becoming a lagging sector despite its massive infrastructure investments.
Author: This news is edited by: Abhishek Verma, (Editor, CANON TIMES)
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