INDIAN RAILWAYS CONTRIBUTION TO THE ECONOMY

INTRODUCTION

Initiatives by Indian Railways (IR) 

Initiatives by Indian Railways (IR) 1. IR has evolved a National Railway Plan 2030 to augment its line capacity in meeting traffic growth by 2030. The Plan addresses Network congestion by a rapid capacity augmentation of :- 

(a) 15,571 Km high (150%) density network (HDN) 

(b) 14,687 km highly (100% to 150%) utilized network (HUN). 

2. IR has conceptualized two Dedicated Freight Corridors (DFCs), East & West to be capable of handling heavy haul trains to run at a maximum of 100 kmph. This will enable giving a boost to both the Eastern Delhi – Howrah & Western Delhi – Mumbai/ Jawaharlal Nehru Port Trust (JNPT) DFC’s which have been sanctioned and are partially commissioned as on date. 

3. With diversion of freight from trunk routes and technical upgradation for high speed passenger operation at 160 kmph, this will help high speed parcel trains to operate as per a set time table as also facilitate movement of high value small consignments. Separation of goods and passenger traffic will lead to enhanced safety. 

4. In June 2022, IR conceptualised a well analysed plan - “MT 3000” for handling 3000 million tonne of commodity movements along with measures to increase share of Railway Freight in a Rail Road Mix from the existing level of 28% to 45% by 2030. This is part of a National initiative contributing towards Climate Change. The plan besides listing prioritization of line capacity projects, also highlights different marketing strategies, with issues & challenges which are required to be overcome, including strengthening door to door delivery of high value/ small items, increasing penetration of containerization, and attracting automobile and other bulk traffic.

Achievements of Indian Railways 

5. Aspect of Safety with no serious passenger fatalities due to Train Accidents in 2019-20 and 2020-21 is commendable. This is due to the thrust on replacement of obsolete over aged assets including track renewals, elimination of unmanned level crossings and expediting replacement of old Integral Coach Factory (ICF) coaches by introducing new and safer Linke Hofmann Busch (LHB) coaches. 

Railway’s Financial Performance and Concerns 

6. Overview of Budget 2022-23, highlights that: 

(c) Operating Ratio - (Expense over Revenue) - 96.98% 7. From the foregoing details, it will be seen that the Operational Internal Generation of Revenue is just Rs. 5,360 Cr. with Railways depending heavily on Gross Budgetary support from the Central Govt and costly Market Borrowings through Indian Railways Finance Corporation (IRFC) for its Capital works for its growth.

Freight Segment 

8. Commodity wise Freight traffic breakup (traffic volume in million Net Tonne Kilometers (NTKM); Earnings in Rs crores). 

9. The above figures indicate that the Railways are dependent on a few commodities vis Coal - 47%, Iron ore – 9%, Cement – 7%, Pig Iron & Steel - 6%, Foodgrains – 5%, i.e. 74%. In the context of Climate Change, with pressures on “phasing down coal utilization”, there is uncertainty on the Railways future demand for Coal.

Passenger Segment 

10. Passenger earnings (Cr). Suburban – Rs 2623, Non-Suburban – Rs 55877, Break up Losses (-) / Profits (+) Profit (+) / Loss (-) class-wise (in Rs Crore) 2018-19 / 2019-20

Note: It may be seen from above table that except for AC 3 Tier rest of the classes are showing losses.

Challenges in Raising Revenue: A Sluggish Growth in Traffic Volume: 

11. Between 2012-13 and 2018-19, Freight and Passenger revenue had grown at a Compound Annual Growth Rate (CAGR) of 6.9% and 8.5%, respectively. Between 2018-19 and 2022-23, revenue from Passenger traffic is estimated to grow at 3.5% while revenue from Freight traffic is estimated to grow at 6.7%. Covid 19 had depressed performance in FY21 and FY22. 

12. Losses in passenger services (Rs 55,000 to 60,000 Cr annually) are primarily due to passenger fares being lower than the costs, concessions to senior citizens which have now been withdrawn, National award winners etc. Railways classify these provisions as social service obligations.

13. The Committee on Restructuring Railways (2015) had observed that several decisions on the Indian Railways such as increase in fares, introduction of new trains, and provision of halts are not taken based on commercial considerations. The Standing Committee on Railways (2020) had recommended that both freight and passenger fares should be rationalised prudently. The Committee recommended that the social service obligations of Railways should be revisited. 

14.

Appropriation to Depreciation Reserve Fund (DRF): As per CAG (2021), at the end of 2019- 20, over-aged assets pending for replacement using DRF fund was estimated to be Rs 95,217 crore (Rs 58,887 crore on track renewal, Rs 26,547 crore on rolling stock). In 2020-23 contribution to DRF is Rs 2,000 Cr. CAG observed that in the backdrop of declining revenue surplus, replacement of over aged assets would become a burden for the Central Government. 

Overdependence on Budgetary Support and Extra- Budgetary Resources to fund Capital Expenditure 

15. Up until 2014-15, Budgetary support from the Central Government used to be the primary source for funding Capital expenditure. However, between 2015-16 and 2020-21, the increase in capital expenditure was sustained through an increased reliance on Extra Budgetary Resources (EBR). 

16. Observations and Recommendations of Standing Committee on Railways. “An examination of Demands for Grants (2020-21) of the Ministry of Railways has revealed that there has been consistently a fall in revenues, rising expenditures and a soaring Operating Ratio. Coupled with this is the continuous erosion of customer base in both freight and passenger traffic segments.” In its final recommendations, the Committee has highlighted the following:- 

(a) Regarding EBR, the principal component and payment of interest to Indian Railway Finance Corporation (IRFC) is estimated at Rs. 26,160 Cr (2020-21). Prudence demands that Railways should not have an over reliance on the market borrowings component of EBR. 

(b) Railway Ministry has attributed a decline in revenue due to passenger, freight and sundry earnings. There has been intense competition in passenger and freight business from low-cost airlines and the expanding Road sector. Impact of the 7th Pay Commission has also contributed significantly to this downturn. 

(c) Committee felt the need for Railways to diversify beyond its traditional Freight commodities. Regarding high support to pensionary payments, amounting to Rs 53,160 Cr in 2020-21, and which constituted a quarter of the total working expense, the Committee suggested that a part of this burden be taken over by Finance Ministry till 2035 when impact of the new pension system would be felt. It was also noted that merger with Finance budget has benefited the Railways in relief from payments for Dividends for Capital at charge and operation of strategic lines which can now be deployed for growth.

Passenger and Suburban Tariff 

17. Survey shows that bulk of passengers are in the economic category that can absorb justified price rises. In many cases, there is reimbursement of travel by employers. Regarding extremely vulnerable sections, the Union and State Govts must consider “Direct Income Transfer Schemes” for travel subsidy, with option to choose mode of urban transport. 

18. Mumbai Rail Vikas Corporation (MRVC) report 2015, states that Mumbai local trains are the cheapest mode of public transport at 50 paise per km (long distance) compared to Metro at Rs 5 per km, Monorail Rs 1.67 and BEST buses at Rs 4 per km. It may be seen that there is considerable scope to increase Suburban fares. 

19. Long Distance Passenger Segment. A sample comparison of fares between Railways and Roads for Delhi-Chandigarh (250Km) is as under:- 

(a) Bus Fare (Rs 1.2 / km) 

(b) Volvo AC Bus Fare (Rs 2.32 / km)

(c) Shatabdi Chair Car (Rs 2.46 / km) 

(d) Mail 3AC (Rs 2.02 / km) 

(e) Ordinary Sleeper (Rs 0.72 / km). 

20. In reply to a question in the Lok Sabha as to when the senior citizen concession will be restored, the Hon’ble Railway Minister said - “If the cost of ferrying a Passenger comes to Rs 1.16 per head, the Railway currently charges only 45 to 48 paise. The Railway Pension bill comes to 60,000Cr, with salary bill adds upto Rs 97,000Cr, the Energy Bill comes to Rs 40,000 Cr, still Rlys bear a subsidy burden Rs 57,000 Cr last year, higher than many state budgets.” 

21. In light of the analysis and facts stated above certain recommendations in this regard are as given in the succeeding paras.

RECOMMENDATIONS TO IMPROVE FINANCIAL PERFORMANCE 

22. There is an immediate need for Railways to progressively increase the mainline passenger & suburban fares in steps in course of next 3-4 years. This is particularly important as Finance Ministry’s ability to extend large General Budgetary Support is limited in view of pressures to contain Fiscal Deficit in the next 2-3 years, due to Global uncertainties. Railways should use additional passenger revenue generated for giving tariff incentives in freight sector to attract sensitive commodities from road to Rail as well as progress critical line capacity works. 

23. Govt should appoint a Committee of experts from Ministry of Finance, Railways, & Niti Aayog to arrive at suggesting the cost of different classes of services in Railways both on Passenger & Freight on a base year. Allowing for reasonable generation of revenue to cover capital investment for growth, base prices may be fixed for passenger class segment & for commodities in freight. In future years, the passenger tariff can be increased annually based on increase in the cost of defined base indices. It is understood that the Ministry of Finance has enacted a similar methodology for levying of tolls on National Highways. 

24. There is a case to consider setting up institutional arrangements, similar to “Bad Bank” concept for the Railways loss making segments e.g. Suburban services by an entity jointly managed by Centre & State Govts. The nominated entity can also decide measures to be adopted for reduction in losses, either by increasing the fares to cover cost & reasonable returns or bearing the losses in some shared formula. It may be pointed out that the metro system in different cities have a joint participation by Central Govt (Urban ministry) and the State. 

25. A decision by the Govt whether Railways procurement of Rolling stock for loss making suburban services as also loss-making passenger services should be borne by the Gross Budgetary Support (GBS) instead of market borrowing will have to be taken. 

26. Railways will have to focus on reduction in revenue expenditure by progressively eliminating redundant activities and critical review of consumption of high value materials. As staff wages including pension is around 68% (BE) of total expenditure, there is a need to prune staff strength, especially, keeping in view the heavy expenditure undertaken in modernisation of Rolling Stock, Track & Signaling, and mechanisation of track maintenance etc. Rlys should consider abolishing a large percentage of vacant posts (around 2.37 lakhs posts which are lying vacant against a total of 15 lakhs sanctioned strength in 2020). There is also a need to emulate the Defense Ministry Agnipath system of Recruitment by the Railways. There is also a need to examine outsourcing of activities to reduce costs. All technological upgradation/ modernisation projects be reviewed on a lifecycle costing also.

Asset Monetisation

27. Under the National Monetization Pipeline (NMP) of the Govt, between 2022-23 and 2024-25, value of Railways’ assets to be monetised is estimated at Rs 1,52,496 crore. This is about 26% of the value of all the assets of the Central Government covered under NMP which is approx six lakh crore rupees in value terms.

IR’s MT 3000 Document June 2022 

Railway’s Planning for 3000MT Movement by 2027 & Increasing its Freight share from 28 to 45% in Rail Road mix 2030" from national perspective : 

29. As per the document, India’s logistics industry generates about 4500-5000MT (3 trillion NTKM) of Cargo annually, with a cost of around Rs.9.5 lakh crores. There is an imperative need from the carbon emission reduction context/climate change context that maximum Freight traffic is shifted from road to rail to take advantage of Railways specific energy consumption per ton km which is only around 1/6th of road. 

    Further with 100% electrification on the broad gauge, there will be substantial savings in oil imports by switching from diesel traction. Though now 70% of electricity produced is from coal based generation, Govt is vigorously planning to reach 50% share of renewable energy mix in power generation by 2030. Therefore 50% of power drawn by electric traction by 2030 would be from renewable energy. Thus, the twin objective of oil import reduction and the pursuit of clean energy will be met by Indian Railways by shifting traffic from Road to Rail. 

30. With the “Business As Usual (BAU)” scenario of CAGR of 4.1% witnessed over past decade, IR is likely to end up achieving 1728 MT of freight loading by FY27 and 1862 MT by FY30, which is far short of the target of 3000 MT by FY 27 requiring a 16.2% growth rate (CAGR). 

31. According to a recent study by TERI by 2030 freight traffic on IR is likely to range between 2007 MT to 2113 MT in accordance with projected GDP growth in the country. The best decadal CAGR of 7.0% in freight transport was achieved in 2001-2010. Even if IR equals the best decadal growth again, the freight traffic will be 2321 MT.

Issues & Challenges in attracting Freight Traffic 

32. The freight segment of the IR is constrained further by line capacity limitations, customer service issues, rigid policy framework, restrictions on piecemeal traffic, low containerization, inadequate inter-modal integration etc. Besides, both passenger and freight trains run on a common network and with the IR prioritizing passenger trains over freight trains for obvious reasons, transit time and reliability of freight trains are seriously affected. While 60% of the capacity of the rail network is deployed for passenger transportation, this segment contributes only 30% to IR’s total revenues, reflecting the distortion which has crept into the system. 

33. Another major issue facing the freight segment of the IR is the price competitiveness of road transport over higher rail tariffs coupled with additional costs of first and last-mile connectivity. This is attributable to extensive crosssubsidization of passenger fares by high freight charges. These are issues cited by stakeholders as a key reason for the shift of freight traffic from rail to roads.

Strategies to Realise Mission-3000 MT by 2027 

34. Supply side Constraints. To ease constraints, there is an immediate need to commission identified Crucial Capacity Enhancement Works i.e. Augmentation & Upgradation of Network and Rolling stock Fleet with need for an outlay of Rs 8.5Lakh Cr in the next 5 years to enable IR to create adequate capacity to carry 3000MT Cargo plus 600MT consequent on transfer from road. 

35. Demand side Constraints. With improved capacity, some additional cargo from the presently unmet demand (400-500 MT) will automatically switch to Rail. However, garnering 3000MT by FY27 cargo necessitates proactive interventions for attracting incremental traffic and inducing modal shift through a well defined marketing strategy, dynamic pricing, assured transit time, higher efficiencies, diversification of commodity basket, enhanced containerization, enabling piecemeal loading, door to door service through intermodal integration and customer centric service delivery. 

36. Strategies for Intermodal Shift. Scenarios are based on two major variables- average transit speed and overall cost to customer. These are:- 

(a) Scenario 1. Business as Usual (BAU): IR infrastructure remains the same along with full implementation of Bharat Mala (road network) & both DFCs 

(b) Scenario 2. Enhancement of average Speed to 50 Kmph on IR network by implementation of capacity enhancement works including DFCs. 

(c) Scenario 3. Enhancement of average cargo Speed to 50 Kmph through capacity enhancement works coupled with 30% reduced cost to customers, except in the 4 commodities of Coal, Fertilizer, Iron ore & Raw materials for Steel, by 2026-27. 

(d) Scenario 4. Same infrastructure with reduction of cost to customers by 30%.

Note :*No tariff reduction is assumed for Coal, Fertilizer, Iron Ore and Raw Material for Steel, as the share of these commodities does not increase by more than 5% even with reduced tariff. Ideally, IR should strive for Scenario-3 for reaching modal share of 45% through a combination of capacity enhancement works and lowering of cost to customer.

37. Policy Initiatives for Inducing Modal Shift. Indian Railways needs re-orientation of Marketing Policies Strategy for inducing modal shift & attract incremental traffic from road, as under:- 

(a) Commissioning of New GATI Shakti Cargo Terminals (GCT): 100 identified GCT to be commissioned by 2025. 

(b) Door-to-Door Service: Customer logistics requirement can be is met fully by Container Train Operators (CTOs) by providing complete integrated service. Door-To-Door Service is an area which Railway needs to focus upon for widening customer base by providing end to end integrated services. 

(c) Improving Containerization: The volume of containerization in India is very low (5%) in the domestic sector compared to developed countries (30%). 

(d) Attracting Automobile Traffic: The rail share of Automobile traffic in India is very low (3.45%) due to a number of reasons concerning rolling stocks as well as pricing issues. 

(e) Proliferating Roll-on / Roll-off (RO-RO) service on DFC & Feeder routes: 

(f) Multipoint Rakes for high value bulk movement: Need for aggregation of smaller Rake composition in loading areas running of full Rakes on large percentage of DFC or IR network & disaggregating the center of demand cluster. 

(g) Strategy & Approach: Major thrust should be to reduce the overall cost of rail transportation to the customer and improve resources to be achieved through improved speed, customer service, tariff reductions/rebate as well as by rationalizing some of the charges for demurrage/wharfage, access, land license, staff cost, stabling, maintenance, road bridging etc. None of the above charges contribute in a big way in the overall kitty of railway freight earnings yet become a major cost burden and compliance on customers.

Note : MT3000 document highlights give details of existing policy framework for the above suggested marketing strategies in great depth. 

38. In case of multi point rakes schemes to attract bulk loads in smaller volume, the scheme though started with good intention has encountered problems due to railways inability to carry out the traffic offered during peak loading seasons due to IR’s capacity constraints.

 

39. Demand supply gap for wagons/containers in domestic sector is due to national priority for transportation of coal, fertilizer, food grains. This needs to be addressed, and be bridged.There is need for adequate wagon investment schemes for private players/aggregators for supply of wagons from the Railways. There should be diversified use of wagons for additional products such as Automobile Freight Train Operator rakes (AFTO) for non automobile products to make investments viable. 

40. Building Customer relationships. Some suggestions include considerable discount on empty container movement subject to guaranteed volume of loaded container traffic During 2020-21, Railway Board had issued a novel policy of debit/credit system of demurrage. By virtue of this, customers were getting incentives to handle cargo in less than prescribed time and use the saved time when there is some delay in handling. but this has been withdrawn by Railway Board in 2022-23. Freight may be charged on the basis of actual shorter bypass distance where usage of bypass line for freight traffic is permanent in nature. With regard to attracting imported coal/pet coke with less density, IR may restore earlier decision to accept traffic based on trial weighments. 

WAY FORWARD AND RECOMMENDATIONS 

41. With regard to the four scenarios indicated in MT 3000 plan, “Scenario 3”: Enhancement of Average Speed to 50 KMPH with 30% Reduced Cost to Customer should be adopted as this strategy will meet not only growth in its bulk commodity traffic but also progressively increase IR’s share in railroad mix from 28% to 45% by 2030 as proposed in Budget 2019. 

42. It may be seen from the table of estimation of Rail Share in various scenarios that under “Scenario 3” substantial traffic growth can take place in Bag of Goods (BoG) (4%-22%) with high value items, Cement (37%-51%), Container (24%-48%), Pig Iron (49%-70%), POL (18%-48%). Aggressive marketing strategies in a sustainable manner will be needed in above areas. 

43. To meet growth in the new areas as discussed above, IR will have to consider running of high speed timetabled parcel trains, focussing on Howrah Delhi, Delhi – Mumbai routes where diversion of Goods trains to DFCs are planned in a big way. IR could consider running of Vande Bharat Parcel trains. Regarding additional container traffic, start could be met immediately in the Eastern and Western Dedicated Freight Corridors. With MT3000 line capacity works getting completed the IR system should also be able to undertake additional parcel, container & bulk movement. 

44. Planning of 3000MT by 2030 is based on a CAGR traffic growth rate of 16.2%.With present global recessionary trends, financial constraints in India, need for tighter fiscal management & consequently general budgetary support to Railways coming down, it will be advisable to plan for around 8% growth rate. It will therefore be advisable to work for a smaller part plan within the framework of present MT3000 & reprioritize projects accordingly. 

45. Regarding Goods freight for increasing containerization, multipoint bulk movement etc, requirement of marshalling facilities for rakes will have to be planned at aggregation/disaggregation points. 

46. It will be advisable for Railways to outsource some of the marketing strategies to Specialist Private Consultant groups with experience in handling a particular class of Goods. There is a need for Railways to strengthen its IT cargo tracker backbone and harmonise IT networks of partners to give a seamless experience to the customer. 

47. It is desirable for Railways to enlist the services of consultants/ international cargo groups to setup strong systems to implement methodologies. Support for studies be approached through bilateral agreements with USA, France, Germany, Japan etc. 

48. Currently, terminal detention of wagons is roughly 65 percent of the total wagon turnaround. There is need for developing modern mechanised terminal infrastructure with support warehouse facilities for customers in PPP mode with priority to Gati Shakti intermodal concept. IR is also liberalizing it’s approach in this regard. Even if IR is to make more investment, it is worthwhile in attracting and sustaining more intermodal traffic. 

49. In addition to large line capacity projects, IR will have to simultaneously focus on small low cost line capacity projects for incremental traffic growth. This will be especially important in IR’s congested routes. There is also an immediate need to carry out survey of line capacity bottlenecks in critical junctions where multiple routes converge like Itarsi, Katni, etc. and where grade separation projects will be required. 

50. Railways share in transport has come down from 37% in 2015 to 28% as of date. Railways traffic / GDP ratio has come down from 0.9 two decades earlier to 0.7 now. This is a matter of concern.The desired shift of Railway share from 28% to 45% by 2030 cannot be brought out only by Market dynamics - IR lowering tariff for sensitive goods with speedier assured delivery. There will be a need for Govt to intervene and arrange for some compulsory shift of Road to Rail by levy of some carbon tax on petroleum and diesel. It is understood European Union (EU) is considering increasing road levy for heavy freight. Govt can consider a study by Niti Aayog in this regard. Mandating Discoms for compulsory purchase of renewable energy as a percentage of total energy mix is an example. 

51. IR will have to reconsider its age old policies of uniform freight structure etc. and opt for dynamic pricing route wise. IR will need to build long term strategic relationships with its customers in bringing flexibility in its rigid tariff/marketing approach. 

52. Govt needs to consider urgently, a Regulating Authority to dwell into customer grievances, predatory pricing, unfair trade practices etc. It is recommended that a Transport Regulatory Authority, instead of a Railway Regulatory Authority, be setup as the Govts focus is now on multi modal transport. 

53. It is important that operation of Freight Dedicated corridors are now merged with IR’s operation to avoid problems in sub-optimal sharing of freight traffic as it happened in the case of Konkan Railway. With progressive diversion of IRs cash generating freight to DFC, the balance portion of IR may start running into heavy losses loaded with loss making passenger operations. 

Dedicated Freight Corridors (DFC) 

54. Ministry of Railways be complimented for developing the concept of Dedicated Freight Corridor following the global practice of separating heavy freight running on higher speed passenger operations. While Eastern & Western DFCs (EDFC & WDFC) are expected to be commissioned by 2023-24, there is need to hasten the sanction of the steel belt corridor Tata Nagar-Rourkela-Rajgangpur/ Bhillai areas and East Coast corridor from Kharagpur to Vijaywada serving several ports, steel & aluminium projects, as also the Vijaywada-Nagpur-Itarsi routes immediately considering the heavy growth in steel & other metal and minerals sectors. Preparation of DPR for completing a quadrilateral/ diagonal network of DFCs on lines of NHAI, should also be undertaken at priority. Balance part of EDFC from Sonenagar to Dhankuni under PPP route be expedited as this is a key part of IR Asset Monetization program.

55. While EDFC & WDFC had been aligned almost along the IR trunk routes, it is recommended that in case of new DFC routes, these be progressed as new alignment as Green Field projects in less populated areas adopting the shortest route principle for the majority traffic. This will help reducing land acquisition cost as well as processing time. This will also help in boosting economy of the rural hinterland & avoid problems of expansion of IR networks if aligned along the same route. Similarly, all loading points and feeder routes should adopt a Green Field approach. 

56. Since operations has already commenced on DFC routes, Railways may consider monitoring whether the operational targets vis maximum speed, throughout etc. which have been planned are being achieved & more importantly whether freight costs are showing a downward trend.This exercise has to continue till full diversion of good trains from trunk routes take place. EDFC & WDFC must plan to introduce time tabled parcel services and consider attracting RoRo services and automobile movements. There is a need to focus on attracting new heavy bulk traffic growth, instead of depending only on diverted goods traffic from IR. 

57. New DFCs must be planned for 32.5 ton axle load & select DFCs e.g. steel belt areas provided for new 32.5 ton axle load wagons as well which will require strengthening of Track Over Head Equipment (OHE) & Signaling including CTC mobile train radio communication etc. Freight terminals/ Multi modal logistic parks be planned right from the beginning and land be acquired for eventual PPP execution. Focus should be on Gati Shakti interconnections.

58. To expedite project execution, planning should be on two phases, firstly upto land acquisition & right of way stage and the secondly actual infrastructure building. Some routes can be tried with Engineering, Procurement and Construction (EPC) contracts combining track OHE & power supply and signaling works together. This approach can help subsequently in project developments coming up in greater numbers for the full PPP model of the project. 

Technological Signaling and Safety Upgradation Thrust 

59. IR has done well to sanction Train Collision Avoidance System (TCAS) for 35,000 Kms with indigenously developed technology for commissioning on Delhi- Mumbai & Delhi – Howrah routes by 2024. 

60. Provision of Automatic Block Signaling (ABS) over 12,000 RKM and Centralized Traffic Control (CTC) System for 14,000 RKM have been sanctioned.These works must be completed at priority. ABS and CTC should be adopted as a matter of policy for all new single lines; existing double line and above sections. DFCCI’s existing sections of Western and Eastern Corridors are provided with Automatic Block Signalling and Train Management System, and will need to be supplemented with CTC immediately to derive significant operational benefits. ASB and CTC will immensely benefit line capacity in Konkan and Srinagar- Baramulla single lines sections without need for doubling immediately. 

61. With 5 MHz spectrum in 700 MHz band having being allotted by DOT in June 2021 for IR’s mission critical train control and communication requirements, there is need to progress Long Term Evolution (LTE) based (4G) Mobile Train Radio Communication (MTRC) & TCAS on HDN and HUN

routes. With enhanced data capability, IR should consider introduction of real time remote monitoring of critical safety items in Fixed & Rolling assets.

Rolling Stock

62. IR has done well in its recent bid for 200 Vande Bharat trains including provision for maintenance support from suppliers over an extended period of 10 years. This will help manufacturers taking extra efforts to build reliability in equipment manufacture. In future orders of Vande Bharat trains for enhancing speeds, reducing energy consumption, use of aluminium body coaches etc, it would be worthwhile to include in the bids and full maintenance support by the supplier bringing his own maintenance machinery, tools & plants, testing equipment and full complement of staff and managers. IR will provide sheds with heavy cranage and only a small compliment of staff for monitoring satisfactory maintenance and undertake safety checks while taking

over trains for operation. This will enable full outsourcing of maintenance activity. This approach could apply in future projects of high speed bullet trains and High Horse powered locomotives etc.

63. IR will need to progress Design & Procurement for 32.5 ton axle load wagons in heavy mineral movement DFC section of Tata, Raurkela as also the East Coast Railway at priority. Development of some multi utility wagons should also be considered to meet variations in demand. Development of

mini containers in assorted sizes should also be considered to help high speed high value parcel traffic and also for fitting into ISO containers.

Speedy Execution of Projects

64. Considering high time overruns within cost overruns in projects, there is need for IR to study some of the good contract models/ practices and financial models developed by NHAI in recent years and plan adoption of the same in Railway project execution.

65. To hasten the tender process and derive competitive rates, clubbing of tendering of different IR agencies by centralised units be considered e.g. Electrification and S&T projects being handled by Central Organisation for Railway Electrification (CORE) and Track projects by Rail Vikas Nigam Limited

(RVNL).

IR’s Commitment to Zero Emission by 2030

66. Against consumption of 21 Billion Units (BU), 2.4 billion Litres of Diesel and 23.2 million tons of carbon emission in 2019-20, with complete electrification, the corresponding figures for 2030 will be 72 BUs electricity, Diesel – 0.2 billion litres, carbon emission approx 60 MT, with an enormous

saving on oil imports.

67. Measures to reduce carbon emissions include Head on Generation (HOG) technology to deliver electric power from locomotives to coaches instead of Diesel powered cars and greater use of Regenerative Braking feeding power back into the system, provision of LED lights in coaches, railway stations and staff colonies, provision of carbon sink by plantation of 6.6 crore tree saplings since 2014-15.

Renewable Energy additions

68. During 2022, Solar capacity of 143 MW, Wind capacity of 103MW has

been installed. IR has undertaken 3 pilot projects:-

(a) 1.7 Mega Watt (MW) at Bina

(b) 2 MW at Diwana,

(c) 50 MW at Bhilai.

69. With IR projected energy demand of around 8,200 MW by 2030, around 30,000 MW renewable capacity will have to be arranged. Renewable energy purchase contracts are in progress for around 4,000 MWs for delivery by

2024-25.

70. Major challenges in procurement of renewable power are:

(a) Deemed licensee status awaited in the States of West Bengal, Chhattisgarh, Odisha, Telangana, Andhra Pradesh, Kerala, Tamil Nadu, Uttarakhand.

(b) Unrestricted net metering provisions in all States.

71. It is recommended this issue be taken up with MNRE and Climate change group of Govt of India.

Corporatization of Railway Production Units:

72. There is considerable unlocked potential in Railway production units with accumulated experience/ expertise & Aatma Nirbhar capabilities in design and manufacture of heavy sophisticated equipment which should be utilised for other National needs also. E.g. Tank, Heavy Gun, Manufacture etc for Defence purposes.

73. It is recommended that on the lines of Corporatizing Indian Ordinance factories, Railway production units be progressively corporatized with the Railway Production Board directly reporting to Railways Ministry.

Organisational Restructuring and Indian Railways Management Service (IRMS):

74. Regarding criticism that functional departments in Rlys are working in silos hampering a systematic approach, decision has been taken to combine all functions through recruitment to a combined IRMS cadre. Railways, over decades have had a proper blend of professionalism and system approach by synergising all functions under neutral control of Divisional Railway Managers (DRM) and General Managers (GM), at higher levels, and bringing in integrating roles like Additional Divisional Railway Managers (ADRM) to give officers a systematic perspective. This has worked very well. Ministry of Railways had done well to recently reconstitute the Railway Board at Member level to oversee system needs by allotting infrastructure, rolling stock & traction, transportation & business development and finance to specific members instead of on a functional basis.

75. Interventions have resulted in benefits of specialisation and need for system judgement has been well achieved. The present decision to do way with emphasis on professional attainment at entry stage and continuing to acquire professional experience and expertise till being assigned for coordinating roles at higher level will have impact on safety, quality and reliability of Railway operations in later years for the impact of this momentous change. Problems of Railways are being catered for in all professional and specialised organisations. Akin to this exercise, it will not be possible to remove all specialities in Medical institutions merely because different disciplines may be asking more funds for their expansion. The large number of successful candidates to IAS - Civil services exams are Medical Graduates. As per Railways analogy, it will not be correct for Central Medical services to draw their base recruitment from the Medical Graduates from the Civil Services exam. Govt is requested to reconsider the issue considering the adverse impact on the Railways.

Need for majority Govt stake in RailTel even with progressive disinvestment from Rail operational security consideration

76. RailTel was formed in 2000 by taking over operational Optic Fibre Cable (OFC) assets of IR with a monopoly of way leaves for laying future OFC, toprovide a secure, fully reliable communication network between stations, Train Control Communication, VPN, etc. for expanding IR.

77. It is now a Mini Ratna company with a market capital of Rs 3,000Cr with 61,000 Route Kilometers (RKM) of OFC along IR network and 21,000 kms in city access system. It is now providing support communication system for TCAS (Train Collision Avoidance System- Kavach). Provision of Automatic Block Signaling (ABS) over 12,000 RKM and Centralized Traffic Control (CTC) System for 14,000 RKM have been sanctioned in the High Density Routes of IR and will be supported by RailTel OFC network. With recent grant of spectrum, there is a need for large scale deployment of Train Radio Communication system to be supported on OFC.

78. Surplus Bandwidth, dark fibers, Multiprotocol Label Switching (MPLS), Virtual Private Network (VPN), HD Video conferencing, and Tower utilization has been fully exploited by RailTel, as a neutral player for private mobile/ network companies. It is earning 90% of its revenue from 700 Private companies / PSUs / Institutions.

79. RailTel is now a preferred system by Defence, Air Force and Coast Guard, and National Security Council Secretariat because of its reliability and high security. It does not use any Chinese equipment. It is best suited for extending Broad Band to the villages around the Railway stations as per PM’s directions. Recently through competitive bidding, RailTel has secured a Rs 174 Crores project for making Puducherry a smart city.

80. RailTel equity has been divested for 27.16% in Stock Exchange. Considering the security issues involved in RailTel operations in the IR system, it is strongly recommended that the Govt may continue to hold a 51% majority stake in RailTel even with progressive disinvestment. This is especially important in the recent context of hacking of Maharashtra Power Systems, All India Institutes of Medical Sciences operations etc.

81. There have also been suggestions for merger of RailTel with IRCTC, with no commonality. In the context of above, RailTel has to be kept as a separate entity under Ministry of Railways.