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“In GOD WE TRUST”

A Project Report on
‘SWOT ANALYSIS of Indian Railways’

Submitted By Submitted To
Manoj Prof. Harmesh Lal
B.Com Final Head.of Comm.Dept.
Roll No. 1106
I Manoj Kumar , Student of

B.Com Final Submitting this Presentation on

‘Swot Analysis of Indian Railways’

To Our Indain Economy Prof. Harmesh Lal.

I am Heartly Thankful to my Subject Teacher

Prof. Harmesh Lal And Our Respected

Principal Mirs. Amrit Varsha who provide

Us Such a helpul Enviorenment to creat this

Presentation .

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<C o n c e p t > <P a g e n o .>

1. Introduction 4

2. Important Facts 5

3. SWOT Analysis 7

4. Strenth 8

5. Weakness 10

6. Opportunities 12

7. Threats 15

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An Introduction

Indian Railways , abbreviated as IR, is the state-


owned railway company of India, which owns and operates most
of the country's rail transport. It is overseen by the Ministry of
Railwaysof the Government of India.

Indian Railways has one of the largest and busiest


rail networks in the world, transporting over 18 million
passengers and more than 2 million tonnes of freight daily. It is
one of the world's largest commercial or utility employers, with
more than 1.4 million employees. The railways traverse the length
and breadth of the country, covering 6,909 stations over a total
route length of more than 63,327 kilometres (39,350 mi). As
to rolling stock, IR owns over 200,000 (freight) wagons,
50,000 coaches and 8,000 locomotives.

Railways were first introduced to India in 1853. By


1947, the year of India's independence, there were forty-two rail
systems. In 1951 the systems were nationalised as one unit,
becoming one of the largest networks in the world. IR operates
both long distance and suburban rail systems on a multi-
gauge network of broad, metre and narrow gauges. It also
owns locomotive and coach production facilities.

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SOME MISCELLANEOUS FACTS ABOUT INDIAN RAILWAYS.
SOME FACTS:

 The total route length of Indian railway is approximately


63,000 kms.

 The first electric train was opened in February 1925 on


Mumbai suburbanrailway on Mumbai Victoria Terminus (VT) –
Kurla branch line.

 As on 31st march, 2004 the electrified route was 17,503


kms.

 The Indian railway largest in the Asia and second largest in


the world afterthe USSR.

 The total number of railway station in India is more then


7,000.

 The Indian railway operates approximately 7,525 trains’ daily


covering7,031 railway stations.

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 The largest platform in India is at Kharagpur. The length is
2,733 feet. It is
situated in west Bengal.

 The longest railway tunnel is Konkan railway tunnel i.e. 65


kms.

 The longest rail bridge is across Godavari River. The length


is 10,052 feet.

 The largest marshalling yard is at Mughalsarai.

 The third class in the Indian railway was abolished in 1974.


Now there are seven classes- AC-1st, AC-2T, AC-3T, Sleeper,
AC chair car, first class and second class.

 Railway set up a fund in 1974 to give financial assistance to


victims of railway accidents.

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On Indian Railways

As far as we will go to SWOT Analysis on


Indian Railways we must clear the meaning of SWOT. Though at
the first look the word ‘SWOT’ seems too simple, but it is a
wide term used as S.W.O.T which contains all the necessary data
or information of a Business Organization, Firm, Others
Institutions etc.

S.W.O.T contains four different aspects in it, in


which ‘S’ stands for ‘STRENTH’ of the concern object, ‘W’ stands
for ‘WEAKNESS’ , ‘O’ stands for ‘OPPORTUNITY’ and ‘T’ stands
for ‘THREATS’ for that concern object.

As we apply this ‘SWOT’ concept on Indian


Railways we see that there is a solid strength of Indian Railways
in itself as well as weaknesses of it. It has great opportunities in
its circle as well as threats from other private sector efforts. In
other words we can say that Indian Railways is a widely used
term in Indian Economy. It alone covers more than 25% of
Indian Economy Structure.

All the four aspects of SWOT in the manner


of Indian Railways are explained and described further.

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 A LARGE NETWORK OF 7000 STATIONS EXISTS IN THE
COUNTRY.

 A SUBSTANTIAL MARKET SHARE EXISTS, IN PASSENGER


SEGMENT. FOR A COUNTRY OF 1000 MILLION PEOPLE WITH
LOW PURCHASING POWER RAILWAY SYSTEM IS MORE
SUITABLE.

 FOR LONG DISTANCE AND BULK SECTOR RAILWAYS IS THE


MOST ECONOMICAL COMPARATIVELY SAFER MODE OF
TRANSPORT.

 PETROLEUM PRODUCTS PROCURED THROUGH IMPORTS ARE


VERY EXPENSIVE AND THUS ELECTRICITY BASED RAILWAY
SYSTEM WILL ALWAYS HAVE AN EDGE ON PARAMERTERS OF
POLLUTION, ENERGY COST, ENVIRONMENTAL FACTORS.

 AVERAGE LENGTH OF HAUL BEING LARGE BREAK EVEN


DISTANCE FEASIBLE FOR RAILWAY SYSTEM IS AVAILABLE.

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The budget outlay for financial year
2006-2007 was Rs. 23,500 Crore (~ USD 5.1
billion) and is expected to be higher in 2007-
2008, with the IR planning substantial investments
in fixed infrastructure and rolling stock to achieve
efficiency and productivity gains in freight
operations that could in turn generate significant
multiple benefits for the economy as a whole.

The 2007-08 Railway Budget is likely


to focus on improving passenger services
extensively. Indian Railways is looking at
significantly improving passenger amenities, including
refurbishment of the design and look of stations.
Work to convert 16 major railway stations into
world-class ones is expected to be set into
motion in the this fiscal, including separating
passenger handling areas from commercial areas,
like in airports.

Greenfield passenger terminals on


similar lines are also being contemplated and could
offer more opportunities for development through
the PPP route.

The Railways is also actively


considering a proposal to re-design the air-
conditioned three-tier coaches for general trains
and increase its passenger carrying capacity.
Changes in the design could increase the capacity
of an AC 3-tier coach in general trains to 81 from
the existing 64.

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THE ORGANISATION IS PRODUCTION ORIENTED.

THERE IS OVER EMPHASIS ON MAXIMISING PKMS,


NTKMS.

 MARKETING IS PERIPHERAL ACTIVITY


AND COMMERCIAL DEPARTMENT IS
BASICALLY ENGAGED IN SELLING
BUSINESS ONLY

 CUSTOMER FOCUS IS MISSING AND


CUSTOMER SATISFACTION IS NOT AN
ORGANISATIONAL MISSION.

 INDIAN RAILWAYS IS LOOSING ITS


MARKET SHARE IN PASSENGER AND
FREIGHT BUSINESS.

THERE IS CAPACITY CONSTRAINT - HOW


TO BALANCE DEMAND AGAINST AVAILABLE
CAPACITY.

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In spite of all various advantage and
specialties, we can not ignore that there are many
serious drawback of Indian railways. They are as
follows:

 Outdated technology of
locomotive :
The rail engines used to run the trains are very
old and outdated technology. So they require much
maintains and they do not give proper return, as
they do not performefficiently. There is immediate
need to change the engines by new and updated
ones.

 Small and inadequate rail


networks :
As India is world’s second largest rail networks
country but if we look by considering
requirements of economy and size of country then
it is not enough. Further India’s
population which is increasing leads pressure on
such facility. So there must be extension
in the rail networks as per the demand and
requirements.

 Problem of financial crunch :


The railway is facing the problem of financial
crunch. The conventional methods of
increasing the net revenue, like rising of tariffs and
expenditure control are inadequate for
generating the levels of investment required.

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MEASURES TO IMPROVE FREIGHT BUSINESS:

 Reduction in unit cost of


freight traffic due to increase
in loading capacity of
wagons and some other measures.

 Additional loading of 4 to 8
tonnes per Wagons per adds
100 Million Tonnes to
loading capacity with resultant Revenue generation of
Rs 5000 Cr.

 Validity of brake power


certificate for CC rakes
increased from 6000 to
7500
km.

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 Wagon manufacture to increase
by about 25%

 Production of electric
locomotive to increase by 17%
and diesel locomotive by
5%.

REDUCTION OF LOSSES IN PASSENGER BUSINESS:

 Increase Volumes reduced unit costs


strategy to be adopted in the passenger
business also.

 Cut down losses in the coaching services


by about Rs 1000 Cr in the coming
year and by 50% in the next three years by
increasing the number of coaches
and occupancy of trains , reducing travel time and
reducing losses in the
catering and parcel segments.

 Over 200 mail/express trains to be made


super fast.

 Journey time of a majority of the


Shatabdis, Rajdhanis and of certain
mail/express trains likely to reduce.
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 The number of coaches in about 190 popular
passenger carrying trains to be
increased up to 23-24 coaches enabling railway to
earn Rs 200Cr additionally
every year.

 Platform length at 200 stations to be


increased at a cost of Rs 60 Cr

 Up gradation of lower class passengers to


higher class without any additional
payment introduced on all Rajdhanis and
mail/express train.

OPPORTUNITIES FOR INDIAN RAILWAY IN


INCREASING THEIR PROFIT FROM MARKET.

Year Freight Passenger


Rail Road Rail Road
1950-51 89% 11% 80% 20%

1996-97 40% 60% 20% 80%

Shift of Traffic from Rail to Road


Freight
100% Rail
80%
Freight
60% Road

40% Passenger
Rail
20%
Passenger
0% Road
1950-51 1996-97

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THE ORGANISATION IS PRODUCTION ORIENTED.

THERE IS OVER EMPHASIS ON MAXIMISING PKMS,


NTKMS.

 MARKETING IS PERIPHERAL ACTIVITY AND


COMMERCIAL DEPARTMENT IS BASICALLY
ENGAGED IN SELLING BUSINESS ONLY

 CUSTOMER FOCUS IS MISSING AND


CUSTOMER SATISFACTION IS NOT AN
ORGANISATIONAL MISSION.

 INDIAN RAILWAYS IS LOOSING ITS MARKET


SHARE IN PASSENGER AND FREIGHT
BUSINESS.

 THERE IS CAPACITY CONSTRAINT - HOW


TO BALANCE DEMAND AGAINST AVAILABLE
CAPACITY.

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