Union Budget 2025: Indian Railways Gets ₹2.52 Lakh Crore to Boost Infrastructure and Safety
Indian Railways: The Indian government has allocated ₹2.52 lakh crore for the Indian Railways in the Union Budget 2025-26, keeping the budgetary support unchanged from the previous year. This significant funding aims to drive the modernization and expansion of the railway network, focusing on enhancing revenue from passenger and freight services while prioritizing safety improvements. Finance Minister Nirmala Sitharaman, in her budget speech on Saturday, highlighted key reforms and investments targeted at improving operational efficiency, safety measures, and infrastructure development.
Capital Expenditure and Revenue Targets for 2025-26
For the upcoming fiscal year, Indian Railways has set a total capital expenditure of ₹2.65 lakh crore, which includes:
- ₹2.52 lakh crore from general government revenues
- ₹200 crore from the Nirbhaya Fund (for women’s safety)
- ₹3,000 crore from internal resources
- ₹10,000 crore from extra-budgetary resources
These funds will play a crucial role in upgrading railway infrastructure, increasing passenger comfort, and ensuring safety measures are in place.
The budget has set an ambitious revenue target of ₹3.02 lakh crore for 2025-26, an increase from ₹2.79 lakh crore in 2024-25. The breakdown of projected earnings includes:
- Passenger revenue: ₹80,000 crore (a growth of 13.2%)
- Freight revenue: ₹1.8 lakh crore (a 7% increase)
This increase in revenue projections reflects the government’s optimism about improving services, efficiency, and attracting more passengers and freight operators.
Growth in Passenger and Freight Revenue
The Indian Railways continues to see a rise in earnings from both passenger and freight services:
- Passenger revenue grew from ₹70,693 crore in 2023-24 to ₹80,000 crore in 2024-25.
- Freight earnings increased from ₹1.68 lakh crore to ₹1.8 lakh crore during the same period.
While the passenger segment has seen a healthy boost, concerns remain about the slower growth in freight revenue despite significant investments in railway modernization and dedicated freight corridors. Experts believe that more aggressive policy measures are needed to make freight services competitive with road transport.
Investment in Safety and Infrastructure Expansion
One of the key priorities of this budget is railway safety. The government has earmarked ₹1.16 lakh crore for safety-related initiatives, which is slightly higher than the ₹1.14 lakh crore allocated in 2024-25.
Additionally, the railway network continues to expand at a rapid pace, with nearly 4,000 km of new tracks being laid annually. Over the past decade, Indian Railways has added 31,180 km of new track, strengthening connectivity across the country.
A major safety initiative under scrutiny is the ‘Kavach’ automatic train protection system, which aims to cover 44,000 route kilometers with advanced signaling technology. However, railway experts, including Shailendra Kumar Goel, former DG of the Indian Railways Institute of Signal Engineering & Telecommunications, argue that the ₹6,800 crore allocated for signaling and telecom work is insufficient to achieve this goal in a timely manner.
Concerns Raised by Railway Unions and Experts
While the government has maintained a strong focus on infrastructure, railway unions and industry experts have raised concerns about staffing shortages and safety.
- Railway unions criticize the lack of new safety-related job posts, citing that a hiring freeze has left critical positions unfilled, affecting railway maintenance and operations.
- The National Federation of Indian Railwaymen (NFIR), led by General Secretary M. Raghavaiah, has demanded urgent recruitment to ensure safer railway operations.
- Experts also point out that despite high investments, train accidents have remained a challenge, emphasizing the need for better maintenance, signaling upgrades, and workforce expansion.
Financial Ratios of Indian Railways (2025-26)
| Financial Metric | 2024-25 (RE) | 2025-26 (BE) | Growth (%) |
|---|---|---|---|
| Total Revenue (₹ Crore) | 2,79,000 | 3,02,000 | 8.2% |
| Passenger Revenue (₹ Crore) | 70,693 | 80,000 | 13.2% |
| Freight Revenue (₹ Crore) | 1,68,000 | 1,80,000 | 7.0% |
| Capital Expenditure (₹ Crore) | 2,60,200 | 2,65,000 | 1.8% |
| Safety Allocation (₹ Crore) | 1,14,000 | 1,16,000 | 1.7% |
| Track Expansion (km) | 4,000 | 4,000 | – |
(RE: Revised Estimates, BE: Budget Estimates)
Conclusion
The Union Budget 2025-26 reaffirms the government’s commitment to strengthening Indian Railways, with a focus on revenue growth, safety measures, and infrastructure development. However, challenges remain in ensuring adequate funding for key safety projects, recruiting personnel for critical roles, and increasing freight competitiveness.
As Indian Railways continues to expand and modernize, the success of these budgetary allocations will depend on their effective implementation. The upcoming year will be crucial in determining how well these initiatives translate into better services, higher safety standards, and a stronger financial position for the national transporter.
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