Budget 2024: Railway Budget To Surge By 25% To Reach Record Heights

In the fiscal year 2024-25, record levels of budgetary allocation are anticipated for Indian Railways, as the government prepares to support a significant overhaul of the national transporter, incorporating additional modern and faster trains along with enhanced safety features.

The capital expenditure (capex) for railways is expected to see a 25% increase from the 2023-24 budget estimate, resulting in a budgetary allocation exceeding ₹3 lakh crore in 2024-25.

An increase in planned capex has been sought by the railway ministry for long-term infrastructure projects, including freight corridors, faster trains, and the modernization of the fleet with new-age trains, wagons, and locomotives.

The elevated capex is earmarked for the rollout of 300-400 Vande Bharat trains in various formats, including those with sleeper coaches, and for overhauling signaling systems.

To expedite the achievement of Mission Zero Accidents, the safety budget of the railways is expected to nearly double. This marks a shift from the stagnant safety budget observed over the past two years at around ₹11,000 crore. The finance and railway ministries did not respond to queries by press time.

Former Railway Board member Subodh Jain emphasized the necessity of a higher plan capex allocation for Indian Railways as it enters a critical phase of implementing key infrastructure projects. He noted the government's substantial support, with over a 50% increase in gross budgetary support in 2023-24, and the expectation that absolute support will reach new levels in the coming year.

Out of the total capital allocation of approximately ₹2.45 lakh crore for Indian Railways in the 2022-23 budget, the Centre's gross budgetary support stood at around ₹1.6 lakh crore. The gross budgetary support increased to ₹2.4 lakh crore in 2023-24 when the total capital allocation for railways reached ₹2.6 trillion.

The expectation is that over 90% of the capital allocation will flow through the government's gross budgetary support in 2024-25. The people with insights into the government's plans mentioned that a significant portion of the higher gross budgetary support may be allocated for the Ahmedabad-Mumbai bullet train project, progressing at full pace for both Gujarat and Maharashtra tracks.