Union Budget 2019: Indian Railways has been opened up to private partnerships for faster development

• In the Union Budget 2019, Finance Minister Nirmala Sitharaman said Indian railways will see public private partnerships for faster development and completion of projects.
• The capital expenditure for Indian railways stands at ₹1.5 lakh- ₹1.6 lakh per annum.
• Indian Railways earned ₹2,01,090 crore in 2018-19 which is a 7% increase from the revised estimates of 2017-18.

In the Union Budget 2019, Finance Minister Nirmala Sitharaman has said that railways in India will be open for public private partnerships for faster development and completion of projects.The FM further mentioned that Indian railways have been given a ₹50 lakh crore allocation between 2018-2030. The capital expenditure on the other hand stands at ₹1.5 lakh- ₹1.6 lakh per annum.

It was expected that the Narendra Modi government would maintain its focus on aggressive development of transportation infrastructure by infusing in major programmes it introduced last year — that includes railway station redevelopment programme, inland waterways development, the Namami Gange project, the Swachh Bharat Mission, UDAN (Airports), metro rail and Smart Cities (Urban Infra).

In the previous budget, the government promised to introduce bullet trains, revamp of signalling systems, CCTVs, Wi-Fi, escalators and other such services at stations, in the massive budget boost where in they allocated Rs 1.48 lakh crore for the Indian railways.

The total allocated capital expenditure for 2018-19 is Rs 1,48,528 crore which is a 24% increase from the 2017-18 revised estimates Rs 1,20,000 crore.

Analysts are expecting to improve the ordinary passenger service rather than the much awaited bullet train that can cost ₹60,000 crore per train.

How much does Railways earn

Indian Railways earned ₹2,01,090 crore in 2018-19 which is a 7% increase from the revised estimates of 2017-18.

The government invests capital expenditure in form of Gross Budgetary Support (GBS) to expand government’s network in India. In 2018-19, the gross budgetary support from central government is proposed at Rs 55,088 crore. This is a 38% increase from the revised estimates of 2017-18 (Rs 41,813 crore).

However, in 2017-18 (revised estimates) GBS decreased by 12%. That is, the central government gave Railways Rs 5,231 crore less than what it had allocated in 2016-17.

Internal revenue from passenger and freight traffic

“In 2016-17, freight traffic contributed to about 63% of the internal revenue. In comparison, passenger traffic contributed to about 28% of the internal revenue. In 2018-19, Railways expects to earn 61% of its internal revenue from freight and 26% from passenger traffic. The remaining 10% is earned through other miscellaneous sources such as parcel service, coaching receipts, and platform tickets.” according to PRS India.