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Asian Tribune is published by E-LANKA MEDIA(PVT)Ltd. Vol. 20 No. 80

Indian Railways need to bring Innovation in operations to fund Infrastructural Inadequacies

By Narsimhan Kasthuri
Bangalore, 05 June, (

The Indian industries have urged the Government of India to bring in innovation in Indian Railways to fund the infrastructural inadequacies.

Vijay Kalantri, President, All India Association of Industries, said, Railway is the lifeline of the Indian peninsula connecting not only business but hearts in bollywood parlance!

Though Indian railways are weakly making two ends meet and have to run pillar to post to maintain the operating ratio of about .90, much can be done to squeeze the same and make up for the inadequacies.

Presently, this ratio allows Railways to be able to meet its working needs. That includes the staff costs, fuel, depreciation etc. It is however in dire needs of funds for infrastructural development. That is not feasible to meet with the present level of operating ratio.

India's rail network is currently facing capacity constraints and network has already reached saturation. In the last few years, railways' transportation business has been declining, and consequently, its ability to generate its own revenue has been on a decline.

A decline in the growth of internal revenue generation has meant that Railways has been funding its capital expenditure through budgetary support from the central government and borrowings. An increased reliance on borrowings could further exacerbate the financial situation of Railways.

Budgetary allocations though aide the Indian Railway as a whole but that conflicts the new principle of “Atma Nirbhar” in context to Indian Railways.

For Indian Railways to be, “Atma Nirbhar or Self Reliant”, it needs to innovate its Business Plan .

No doubt decentralization instead of centralization can favor to wash out the scams in procurement and operations. At the same time technological innovations in the same will bring about higher efficiency in making smooth flow of operations.

Though , most of the government departments are now technologically driven , however technology back end services still fail to play effectively in wide range of operations of Indian Railway.

Innovation means funding and funding is what the Railways are struggling to procure.

It is true that in comparison to roads door to door connectivity in case of railways is just 50% . And door to door connectivity delivery service segment of roads is what inches up against railways since it has an edge in the same.

However, the railways need not lose their spirit as an enthusiastic and strategic vision can still make it possible to achieve not only profits but at the same time help it to become self reliant without budgetary allocations .

Further Mr. Kalantri said, the Indian Railway caters heavily to the lowest segments of the society and need to be resilient to their paying capacity. However, in medieval times the Indian Railway did hike ticket cost for the luxury segment however the same was contradicted in terms of time of travel.

In such a situation , the Indian Railways need to adopt business models prevailing in many other countries where railways are serving logistics interests of large manufacturing hubs in form of private railway.

In India where crude oil prices rule the roost and eat up huge profits in the logistics chain the private Railways running on solar batteries could serve as a better choice.


1. Private railway networks can be laid from warehouses to ports or industrial hubs to warehouses depending on preference. And can be operated privately offering annual subscription to the railway departments.

2. Skilled and diligent man power will operate such a network which will avoid reckless driving of trucks and frequent accidents on the highways with more space for the normal traffic on the already congested roads and highways.

3. Such private railway network can be worked out on PPP basis with the Railway Ministry liable for land procurement while the entire work of construction and operation to be outsourced to private players.

This will dampen the ongoing corruption in case of e-tenders floated for procurement in new projects due to technological inadequacies .With the private player totally liable for the operations of such private networks.

4. Boost ancillary supplier industry at free will without suppression of Government tenders thus boost employment by way of private railway network sector.

5. Although, RVNL is there in place. However, it needs to be proper allocation of funds and support and they need to be more proactive and forthcoming with PPP projects.

6. Delhi freight corridor project needs to be expedited to complete and fortify value chains in the logistics sector. Industrial hubs /SEZs can be built on the either side which will boost rural employment and there will be less migration to the cities. As jobs will be available in the rural background itself as this alone was the original ides behind the DMIC project backed by Japanese investment.

Price competitiveness, quality technology and Efficient design of business plan is what will make Indian Railway a profit center than a cost center.

This will also decrease the dependence on road infrastructure to a large extent.

Stay Safe, Stay at Home, Stay Informed, But Don't Forget to Wash Your Hands.

- Asian Tribune -

Indian Railways need to bring Innovation in operations to fund Infrastructural Inadequacies
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