Indian Railways: Making significant strides towards sustainable and efficient rail mobility

India has the fourth largest railway network with over 22,593 operating trains (9141 freight and 13,452 passenger) with a daily passenger count of 24 million passengers and 203.88 million tonnes of freight.

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Sustainable Infrastructure: An Introduction

Sustainable infrastructure involves developing roads, railroads, buildings, energy and water infrastructure with due consideration to economic, social and environmental implications. The International Institute for Sustainable Development (IISD) defines sustainable infrastructure assets as those which:

  • Lower carbon and environmental footprints
  • Protect natural ecosystems
  • Prove resilient to changing climates
  • Optimize the use of natural ecosystems and their “infrastructure services”
  • Move beyond compliance on core labour standards and human rights
  • Trigger technological and industrial innovation
  • Increase investment in education and research and development (R&D)
  • Increase employment
  • Demonstrate financial viability 
  • Crowd-in domestic investors and businesses
  • Increase foreign direct investment
  • Bring value for money for taxpayers and investors

Indian Railways : A viable and sustainable transport system

India has the fourth largest railway network with over 22,593 operating trains (9141 freight and 13,452 passenger) with a daily passenger count of 24 million passengers and 203.88 million tonnes of freight. India’s railway network is recognised as one of the largest railway systems in the world under single management.

The railway network is also ideal for long-distance travel and movement of bulk commodities, apart from being an energy efficient and economic mode of conveyance and transport. Indian Railways is the preferred carrier of automobiles in the country. Government of India has focused on investing in railway infrastructure by making investor-friendly policies. It has moved quickly to enable Foreign Direct Investment (FDI) in railways to improve infrastructure for freight and high-speed trains. At present, several domestic and foreign companies are also looking to invest in Indian rail projects. Indian Railway network is growing at a healthy rate. In the next five years, Indian railway market will be the third largest, accounting for 10% of the global market. Indian Railways, which is one of the country’s biggest employers generates nearly one million jobs.

The government has announced two key initiatives for seeking private investments-running passenger trains by private operators across the railways network and redevelopment of railway stations across the country. According to Indian Railways, these projects have the potential of bringing an investment of over US$ 7.5 billion in the next five years. ‘Adarsh’ Station Scheme has been started since 2009-10 and presently, railway stations are upgraded/modernised based on identified need of providing better enhanced passenger amenities at stations. Under the scheme, 1253 stations have been identified for development, out of which 1201 stations so far have been developed. The remaining 52 stations are planned to be developed by 2021- 22. Indian Railways is also looking at other areas of revenue generation as under: 

(a) Change in composition of coaches so that it can push the more profitable AC coach travel; 

b) Additional revenue streams by monetising traffic on its digital booking IRCTC; and 

c) Disinvesting IRCTC.

The Indian Railway launched the National Rail Plan, Vision 2024, to accelerate implementation of critical projects, such as multitrack congested routes, achieve 100% electrification, upgrade the speed to 160 kmph on Delhi-Howrah and Delhi-Mumbai routes, upgrade the speed to 130 kmph on all other golden quadrilateral-golden diagonal (GQ/GD) routes and eliminate all level crossings on the GQ/GD route, by 2024.

Efforts for raising Revenue

  • Revenue growth has been strong over the years. Indian Railways’ revenue reached US$ 23.30 billion in FY22 (Until March 10, 2022). The gross revenue stood at US$ 16.89 billion in FY21 (until March 10, 2021). In case of freight earnings, it experienced a year on year growth of 21.81% It stood at US$ 17.68 billion in FY22 (until March 2022) as compared to FY21 which was at 16.04 billion. Passenger earnings for Indian Railways was at Rs. 50,669.09 crore (US$ 7.25 billion) in FY20. The total passenger revenue stood at US$ 4.66 billion until March 10, 2022 as compared to FY21 which was at US$ 2.03 billion. This was a 162.46% growth. The gross revenue stood at Rs. 85,588.96 crore (US$ 11.44 billion) in FY22 (until September 2021).
  • In FY22 (until September 2021), passenger earnings stood at Rs. 15,434.18 crore (US$ 2.05 billion) and freight earnings (until October 2021) stood at Rs. 78,921.86 crore (US$ 10.5 billion). Freight earnings stood at US$ 16.04 billion in FY21. In October 2021, freight earnings stood at Rs. 12,312.76 crore (US$ 1.63 billion) and freight loading reached 117.35 million tonnes. Freight remains the key revenue earning segment for the Indian Railways, accounting for 79.1% of the total revenue in FY22 (until August 2021), followed by the passenger segment.
  • Freight remains the major revenue earning segment for Railways, accounting for 65% of its total revenue in FY20, followed by the passenger segment. In FY20-21, Indian Railways recorded the highest loading in freight transportation. Freight traffic carried by Indian Railways stood at 1,232.64 million tonnes in FY21. With this, the freight revenue of Indian Railways also increased to Rs. 1,17,386 crore (approx.) (US$ 16.04 billion) for the year 2020-21, as against Rs. 113,488 crore (US$ 16.10 billion) during fiscal 2019-20. 
  • During FY20, passenger traffic in the country reached 8,086 million and is estimated to reach 12 million by 2031. In FY22 (until March 2022), passenger traffic stood at 3.23 billion. In August 2021, freight earnings stood at US$ 1.43 billion and freight loading reached 110.43 million tonnes. Since August 2020, the Indian Railways has run 450 Kisan Rail services and was able to transport over 1.45 lakh tonnes of agricultural produce & perishables.
  • RailTel, a PSU under the Railway Ministry, which provides fast and free Wi-Fi across the Indian Railways network, announced its highest ever consolidated income of Rs. 11,660.05 million (US$ 158.48 million) for FY19-20. This income figure is a growth of 12.3% over the consolidated income of the financial year FY18-19. 
  • In June 2021, freight earnings stood at US$ 1.50 billion, which is 26.0% higher than last year’s earnings of US$ 1.19 billion, and freight loading reached 112.65 million tonnes, which is 11.19% higher than last year’s loading of 101.31 million tonnes. In November 2020, India Railways announced that 40% of dedicated freight corridor (DFC) will be opened for traffic by end-FY21, while the entire 2,800 km route will be completed by June 2022.
  • India was among the top 20 exporters of railways globally as of 2017. India’s export of railways has grown at a CAGR of 31.51% during 2010-2018 to US$ 507.90 million. Exports of railways in 2019E stood at US$ 635 million. Indian Railways is developing and creating technology in areas such as signalling and telecommunication with 15,000 kms being converted into automatic signalling and 37,000 kms to be fitted with ‘KAVACH’, the domestically developed Train Collision Avoidance System.

Push in Investments: Infra Development, Sustainability

Foreign Direct Investment (FDI) Inflows in railway-related components stood at US$ 1.23 billion from April 2000- June 2021.

Following are some of the major investments and developments in India’s railways sector:

  1. In November 2021, Indian Railways announced that ~102 semi-high-speed Vande Bharat Expresses are expected to commence operations by 2024, with at least 10 new trains scheduled to launch by August 2022 that will connect 40 cities. In October 2021, Indian Railways announced a plan to establish ~500 multi-modal cargo terminals under the ‘PM GatiShakti’ programme, with an estimated outlay of Rs. 50,000 crore (US$ 6.68 billion) in four-five years. Through this plan, the government plans to integrate various modes of transportation for seamless movement of parcel and bulk cargo (e.g., coal and steel).
  2. In July 2021, the South Central Railway zone announced infrastructure development by doubling the maximum permissible speed to 100 km per hour on the Godavari Bridge. The initiative gave a major boost to the Indian Railways on infrastructure modernisation. In July 2021, Indian Railways executed remodeling of Gangapur City Yard to boost the speed of railways between Delhi and Mumbai route. Since the launch of first ‘Kisan Rail’ service on August 7, 2020, the Indian Railways have operated a total of 1,040 Kisan Rail services by transporting ~3.38 lakh tonnes of consignment across 72 routes in the country until July 30, 2021.
  3. The Indian Railways is likely to deliver 58 super critical as well as 68 critical projects worth more than Rs.1,15,000 crore (US$ 15.44 billion) in the next few years. 27 super critical projects will be completed by December 2021, while two projects will be handed over by March 2022. 29 super critical projects—spanning 1,044 kms and costing Rs. 11,588 crore (US$ 1.5 billion)—have been commissioned. Four projects worth Rs. 1,408 crore (US$ 189.05 million) have been completed and the remaining projects are targeted for completion by March 2024.
  4. In July 2021, the Ministry of Railways received bids from the private and public sectors to operate 29 pairs of trains with about 40 modern rakes, entailing an investment of ~Rs. 7,200 crore (US$ 966.74 million). On July 25, 2021, the Indian Railways Station Development Corporation (IRSDC), a nodal agency of the Ministry of Railways spearheading the re-development of railway stations across the country, claimed that the two railway stations will be redeveloped at an indicative cost of Rs. 1,285 crore (US$ 172.54 million) in four years.
  5. The Indian Railways has decided to undertake electrification of Broad Gauge (BG) rail lines in a mission mode and is likely to complete the process by 2023-24. Of the 64,689 kms of broad gauge route, 45,881 kms has been electrified and the remaining 18,808 kms route is yet to be electrified. About Rs. 21,000 crore (US$ 2.8 billion) is estimated to be spent on electrification of the remaining BG routes.
  6. As of May 2021, the Indian Railways loading stood at 73.45 million tonnes (MT) including 35.62 MT (coal), 9.77 MT (iron ore), 3.38 MT (food grains), 2.22 MT (fertilisers) and 3.15 MT (cement, excluding clinker). As of May 5, 2021, Indian Railways commissioned Wi-Fi at 6,000 railway stations. In May 2021, the Government of India and European Investment Bank (EIB) signed a finance contract for the second tranche of US$ 182.30 million for the Pune Metro Rail project.
  7. In January 2021, Prime Minister Mr. Narendra Modi flagged off the world’s first double-stack, long-haul container train from New Ateli in Haryana to New Kishanganj in Rajasthan. In January 2021, Hyundai Motor India Ltd. (HMIL) has announced that it has exported 125 cars to Nepal via the Indian Railways. The export is claimed to be eco-friendly and the first-ever by the company. With this step, the company is aiming to reduce carbon footprint by 20,260 tonnes.
  8. On November 26, 2020, National High-Speed Rail Corporation Limited (NHSRCL) signed an agreement with L&T to design and construct 47% alignment works for Mumbai-Ahmedabad bullet train project. The Indian Railways completed eight major capacity enhancement projects by taking advantage of the coronavirus lockdown. These projects included three super critical projects with a combined length of 68km, three critical projects with a combined length of 45km, upgradation of the entire 389km railway line from Jhajha in Bihar to Pandit Deen Dayal Upadhyaya Junction in Uttar Pradesh and a new 82km port connectivity line to Paradip.
  9. As a part of the Railways’ plans to upgrade its network, the Ministry announced that all non-AC sleeper coaches will be replaced by AC coaches for trains running >130 kmph. This move has been taken as a technical necessity for high-speed trains with the bonus of improving passenger experience.

Few recent initiatives taken up by the Government are:

  1. India is rolling out 400 Vande Bharat trains that is expected to bring Rs. 40,000 crore (US$ 5.24 billion) of business opportunity for the country. Under the Union Budget 2022-23, the government allocated Rs. 1,40,367.13 crore (US$ 18.40 billion) to the Ministry of Railways.
  2. In October 2021, India and Nepal signed an MoU (Memorandum of Understanding), for a proposed US$ 3.15 billion railway line project, to connect Kathmandu and the Indian border town, Raxaul. In June 2021, the Central Government approved the implementation of a 235 km semi high-speed rail corridor between Pune and Nashik in Maharashtra. The cost of building this project will be Rs. 16,039 crore (US$ 2.20 billion). In June 2021, the Central Government approved a Rs. 25,000 crore (US$ 3.43 billion) five-year plan to use 4G technology to modernise communication networks in railway stations and improve the safety and security of train journeys.
  3. Indian Railways has logged the highest ever electrification of sections covering 6,015 Route Kilometer (RKM) in a single year during 2020-21. More than 5 times electrification was achieved during (2014-21) last seven years as compared to during 2007-14.
  4. In April 2021, Indian Railways completed the arch closure of the under-construction Chenab Bridge which is the world’s highest railway bridge. Chenab Bridge is 1315 m long and will be 35 meters higher than Eiffel Tower in Paris. The total cost of the bridge is estimated to be Rs. 1,486 crore (US$ 200.46 million) and the design life of the bridge is said to be 120 years.

In FY21-22, the Indian Railways announced to complete several projects. The Railway Ministry has identified 56 projects in various railway zones that is proposed  to be completed by end of the fiscal year.

  • Under the Union Budget 2021-22, the government allocated Rs. 110,054.64 crore (US$ 15.19 billion) to the Ministry of Railways. In February 2021, Minister of Railways Mr. Piyush Goyal dedicated 88 Railway projects to the country worth Rs. 1000 crore (US$ 138.14 million) in the states of Kerala, Tamil Nadu, Madhya Pradesh, West Bengal and Karnataka.
  • In February 2021, Indian Railways called for ‘Request for Qualification (RFQ)’ for redeveloping New Delhi railway station under a public-private partnership, with an estimated project cost of Rs. 5,000 crore (US$ 690.75 million).
  • To boost rail infrastructure and make the Indian Railways network future ready, Indian Railways has identified 56 projects across the country in various zones to be completed by Feb-Mar 2021 and FY22.
  • In July 2020, the Ministry of Railways has invited Request for Qualifications (RFQ) for private participation in operating passenger train services across 109 Origin Destination (OD) routes. As part of the plan, the railways will introduce 12 trains in FY23, 45 in FY24, 50 in FY26 and 44 more in the next fiscal, taking the total number of trains to 151 by the FY27. The project would entail private sector investments of about Rs. 30,000 crore (US$ 4.09 billion).
  • The Government is going to come up with a ‘National Rail Plan’ to enable the country to integrate its rail network with other modes of transport and develop a multi-modal transportation network. A ‘New Online Vendor Registration System’ has been launched by Research Designs & Standards Organisation (RDSO), the research arm of Indian Railways, to have digital and transparent systems and procedures.
  • The Ministry of Railways plans to monetise assets including Eastern and Western Dedicated Freight Corridors after commissioning, induction of 150 modern rakes through PPP, station redevelopment through PPP, railway land parcels, multifunctional complexes (MFC), railway colonies, hill railways and stadiums.

Sustainable Development for the future

Indian Railways is one of the largest integrated railway networks in the world. With an enormous route length of more than 126,511km, operating many thousands of regular trains over 7,325 stations, with an employee strength of nearly 1.1 million, the operations of IR certainly are one of the bigger, more varied and highly complex of any across the world. Owning 76,608 passenger coaches, 2,93,077 freight wagons and more than 12,000 locomotives, as the eighth largest employer in the world, IR plays a very critical and significant role in the economic life and operations of India. 

No wonder IR requires itself to remain vigilant to the evolving situation and requirements of its society, economy and nation. The coronavirus pandemic has affected our operations and activities too. However, we have come up with a long-term National Rail Plan (NRP) with the objective of developing infrastructure, and capacity, with a special emphasis on enhancing our share of freight logistics in the overall share of IR revenue. 

A long-term vision for Indian rail

Unlike previous IR plans, the new vision plan has envisaged preparing India’s national transport for the coming decades of 2041 and 2051. Plans are afoot to study the physical, material and human resource limitations of the organisation, assessment of contemporary and future modal share of IR, future requirements of fixed and rolling stocks, funding and financing strategies.

One significant feature of the plan relates to preparing for capacity requirement, both in terms of passengers and freight, ahead of demand by targeting the peak and not merely the averages, as has been the case previously. Secondly, based on financing strategies, existing and future railways projects are to be identified based on options, evaluation and prioritisation. 

Major Accomplishments

Between 2008-2014, eight studies were undertaken by IR including the Total Transport Study (RITES) and the India Transport Report, but, importantly, no comprehensive studies or work has been carried out, particularly in the last five years. Some of IR’s major, more recent, achievements can be summarised as follows:

  1. Dedicated Freight Corridors (DFCs)

The story of Dedicated Freight Corridors (DFCs) has been a spectacular one. Two of them, the Eastern Dedicated Freight Corridor (EDFC) and the Western Dedicated Freight Corridor (WDFC), are already functional, while four more DFCs have been planned where freight trains will run at an average of 90-100km/hr, as against the existing 25-30km/hr.

  1. Connectivity

IR has connected almost the whole of India through the railways. States like Manipur, Tripura, Arunachal Pradesh, Jammu and Kashmir have all have been connected for the first time in the country’s history, while more parts are being added to the IR network. Beyond the country’s frontiers, IR is also working on initiating and enhancing connectivity with Bhutan, Bangladesh, Nepal, Myanmar and Pakistan.

  1. Carbon Neutral

Sustainable development is being achieved through the greater use of solar energy, biogas, bio-toilets in passenger trains, LED lights, rainwater harvesting, and reforestation. Substantial electrification is also being implemented to ensure IR becomes a carbon neutral transporter by 2030.

  1. Stations

Passenger services and amenities have been improved substantially. Stations are much cleaner and, as part of a station redevelopment plan worth $13 billion, 400 stations have been taken up in a Public-Private Partnership (PPP) model.

  1. Safety

To address safety aspects, long considered to be one of IR’s vulnerabilities, an Automated Fire Alarm System, an Automated Fog Assistance System, CCTV cameras for stations and trains, Wi-Fi enabled stations, complete elimination of unmanned railway crossings and faster modernisation and digitisation on doubling of railway tracks, as well as signalling systems, as part of the $13 billion National Rail Safety Fund, are being developed and/or implemented.

  1. High-speed trains

High-speed trains and semi-high-speed trains that may have seemed impossible in Indian conditions, are already functioning with some about to start. Gatiman Express, Vande Bharat Express, Tejas Express, and vista dome coaches have all been introduced within a short time, while the metro rail network is already running in 11 Indian cities. The bullet train on Ahmedabad-Mumbai is also being advanced, while five more high-speed bullet train routes are being finalised.

  1. Tourism

A very significant, though less talked about aspect of IR, is its huge tourism potential. It has recently introduced specialised tourist trains such as the Punj Takht, Mahapariniravan Express, Ayodhya Circuit which are certain to add value and revenue to the ambitious expansion plans of the Indian railways.

  1. Eyeing future challenges

With plans to invest a massive $320 billion in enhancing connectivity and profitability, IR is currently standing at the threshold of a great future. With more functional autonomy, professional management and effective utilisation of scarce resources and strategies, what was widely perceived as a ‘white elephant’ in Indian bureaucratic circles until recently could well emerge as one of the major public corporates donning the global economic landscape in the not-so-distant future.

  1. Going Digital

The focus on digitalisation has received a further boost in this year’s Union Budget. Investments in predictive maintenance through advanced digitalisation systems like Vehicle Equipment Monitoring Systems and modernisation of Rolling Stock depots are foreseen to reduce the lifecycle cost, yielding significant dividends. The faster, accurate and advanced digitalisation solutions will not only address conventional challenges, but also improve operational efficiency and enhance safety.

The digital solutions for rolling stock propulsion for locomotives, hotel load converters and signalling solutions will enable the railways to scale up capacity and improve throughput, in addition to bringing in green technology. Besides digitalisation and technology, there should also be increased investments for research, design and manufacturing, which would be key drivers in the transformation of the railways.

With the vision and investments firmly in place, the need of the hour is to double down on execution and implement the initiatives in a time-bound manner. For instance, carrying out accelerated implementation of end-of-train telemetry, automated signalling and various other measures will ensure timely modernisation of rail infrastructure. Indian Railways is already speaking a market savvy language. Also, the focus on safety is visible with emphasised action towards proliferating the Kavach technology for 2,000-km tracks. Various steps are also being taken to meet the railways’ plan to be net zero in emissions by 2030. The development of a modern railway system at the national as well as metropolitan level will not only yield notable economic dividends, but also contribute to India’s sustainability and climate-change goals.

Conclusion

With a network of around 68,000 route km, rail transport is the backbone of the Indian economy. Even as the process of electrification and signalling automation is underway on key railway corridors, the government has now given a green signal for digitisation initiatives to usher in a new era of safe and smooth transportation of people and goods. With the Centre aligning the injection of cutting-edge technologies in the railways with its flagship initiative of Make in India and Atmanirbhar Bharat, the measures will go a long way in accelerating asset addition, enhancing efficiency, building capacities, and creating new infrastructure.

The railway leadership has brought the medium-term objective of raising its modal share from 28% to 40% and increasing originating cargo from 1,400 MT to 2,000 MT by 2024 at the centre of all action. For this, it is adopting a progressive stance while earnestly addressing the needs of its customers as well as eliminating the obstacles faced by its suppliers and service agencies.

The railways have also taken up sizable measures to accelerate the pace of electrification. Its EPC model for awarding large-size contracts with balanced conditions not only lessens the burden on the contractor’s cash flow, but also ensures smooth execution of the work within a defined timeframe. On its part, the industry is ready with 100% localised products for execution of the automatic signalling mandate, with electronic interlocking and axle counters ready to be rolled out for automatic signalling throughout high density networks.

Indian Railways surely is working hard to be an all class future centric transport system with world-class facilities at an affordable cost. Days are not far when travel by IR would be synonymous to comfort and ease.

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