Financial Position of

Indian Railways
 Financial Position of IR at a glance

Sources of Receipts of IR
2022-23

Gross Budgetary Internal Extra Budgetary

Support
Rs.1,37,300 Cr.
Resources
Rs.2,40,000 Cr.
Resources
Rs1,01,500 Cr.

Gross
Traffic
Receipts
Rs.2,39,600 Cr.
 Financial Position of IR at a glance

IR Summary of receipt and expenditure from 2018-19

Summary of Capital and Revenue expenditure
Revised Budget
S. Actual Actual Actual
Details Estimates Estimates
No. 2018-19 2019-20 2020-21
2021-22 2022-23
1. CapitalExpenditure2 1,33,376.66 1,48,064.48 155181.00 215000.00 245800.00
Revenue Expenditure
2. 1,86,733.51 1,73,105.07 138236.07 201125.00 234640.00
Summary of Revenue Receipts and Revenue Expenditure in Cr of Rs
1 Passenger Earnings 51,066.65 50,669.09 15248.49 44375.00 58500.00
Other Coaching 4,474.46 4,640.79 2096.75 5000.00 6000.00
2 Earnings3

3 Freight Earnings 1,27,432.72 1,13,487.89 117231.82 145275.00 165000.00

4 Sundry Earnings4 6,996.23 5,862.75 5938.61 7000.00 10000.00

5 Total Traffic Earnings 1,89,970.06 1,74,660.52 140515.66 201650.00 239500.00
Clearance from Traffic
6 Outstanding (Suspense) (-)63.48 (-)303.92 54.86 100.00 100.00
7 Gross Traffic Receipts 1,89,906.58 1,74,356.60 140570.52 201750.00 239600.00
 Financial Position of IR at a glance

IR Summary of receipt and expenditure from 2018-19

Summary of Capital and Revenue expenditure
Revised Budget
S. Actual Actual Actual
Details Estimates Estimates 2022-
No. 2018-19 2019-20 2020-21
2021-22 23
8 Miscellaneous Receipts6 600.79 338.09 213.03 250.00 400.00
Total Receipts
9 1,90,507.37 1,74,694.69 140783.55 202000.00 240000.00
(ItemNo.7+8)
Net Ordinary Working 1,40,200.30 1,50,211.21
10 135844.51 149800.00 170000.00
Expenses7

Appropriation to
Pension Fund 44,280.00 20,708.00
11 523.00 49000.00 60000.00
300.00 400.00
Depreciation Reserve Fund(DRF) 200.00 500.00 2000.00

Total Working Expenses 1,84,780.30 1,71,319.21

12 136567.51 19300.00 232000.00
(ItemNo.10+11)

13 Miscellaneous Expenditure 1,953.21 1,785.86 1668.56 1825.00 2640.00

Total Expenditure 1,86,733.51 1,73,105.07
14 138236.07 201125.00 234640.00
(ItemNo.12+13)
Net Surplus 3,773.86 1,589.62
15 2547.48 875.00 5360.00
(ItemNo.9(-)14)
 Share of Various Resources of IR during
last 7 years

478800
414500
320162 326538
264936 277985 293906
245687

Total Resources
Rupees in Crores..

240000
202000
190508
178930

174695
168380

165382

140784

137300
123196

117300

101500
95200
84001
76816

67842
55638
54322

52838
45232

43417
39789
37518

29926
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 RE 2022-23 BE

Internal Resources Extra Budgetary Resources Gross Budgetary Support

 Total Revenue Receipts
239600
190508 201750
168380 165382 178930 174695
140570

Total Receipts
Rupees in Crores..

165000
180000

145275
127433
160000

117232
117055

113488
109208

140000
104339

120000

100000

58500
80000
51067

50669
48643
46280

44375
44283

60000

16100
15248
14889

14763

13232

40000

12100
12008

10538

8090
20000

0
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 RE 2022-23 BE
Freight Earnings Passenger Earnings Other Earnings
 Major Components of
Revenue Expenditure

120000

99840
92993

90619
100000

86220
77004
71803
80000
65779

60000
56115

53300
53260
49188
46718
60000
45275
40463

32435

31854
30700

30332

28938
27715

40000
26119

26085
25730

20013
15648
14224
10391
9977

20000
9003
8598
7723

0
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 RE 2022-23 BE

Staff Pension Outgo Fuel Lease Charges

 Expenditure on Pension Payments on IR

Rupees in Crores..
60000
53260 53300
46718 49188
45275
40463
30701

2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 RE 2022-23 BE

Pension Payments
 OPERATING RATIO

100
98.93
98.44 98.36
98 97.29 97.45
96.98
96.5
96

94

92
90.49
90

88

86
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
RE BE
 Net Revenue

12000
10506
10000

8000

6000 5360

3774
4000
2547
1913 1666 1590
2000
875
0
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23
RE BE
Revenue Surplus
Performance of
Previous year
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
Railway Budget 2021-22 at a glance
A glimpse on IR Capital Expenditure

Figures in
Crores
A glimpse on IR Capital Expenditure
A glimpse on IR Capital Expenditure

Figures in
Crores
A glimpse on IR Capital Expenditure
A glimpse on IR Freight Traffic
 Financial Health of Railways
C&AG Reports

Net Surplus: (Report No.13 of 2021 of C&AG of India)

The total expenditure of Indian Railways grew from Rs. 3,20,110.17 crore in 2018-19
to Rs. 3,21,169.55 crore in 2019-20, registering a marginal increase of 0.33 per cent.
The capital expenditure increased by 11 per cent, whereas the revenue expenditure
decreased by 7.30 per cent during the year. The committed expenditure of staff cost,
pension payments and lease hire charges on rolling stock, was 73 per cent of the total
working expenditure in 2019-20.

 During 2019-20, the Total Receipts decreased by 8.30 per cent as compared to 6.47
per cent increase in 2018-19. The decrease in 2019-20 was mainly on account of
decline in Freight Earnings (by 10.94 per cent) and Sundry Earnings (by 16.20 per
cent) as compared to 2018-19.

There was heavy dependence on transportation of Coal, which constituted 48.82 per
cent of Freight Earnings. Any shift in bulk commodities transport pattern could affect
the freight earnings significantly.

 Net surplus was Rs. 1,589.62 crore in 2019-20, as compared to Rs. 3,773.86 crore
in 2018-19. Railways would in fact, have ended up with a negative balance of Rs.
26,328.39 crore instead of surplus of Rs.1,589.62 crore, had the actual amount (Rs.
48,626 crore) required to meet the expenditure on pension payments of Zonal Railways
been appropriated to the Pension Fund (instead of Rs. 20,708 crore).
 Financial Health of Railways
C&AG Reports

Showing OR in better light: (Report No.13 of 2021 of C&AG of India)

The Operating Ratio which was 97.29 per cent in 2018-19 increased to
98.36 per cent in 2019-20. The OR of the Railways would have been
114.35 per cent instead of 98.36 per cent if the actual expenditure on
pension payments is taken into account. Thus the OR of 98.36 per cent
shown by the Railways does not reflect the true financial performance of
the Railways.

During the year 2019-20, Railways appropriated an amount of Rs.

200.76 crore from its internal resources to RRSK.

Further, Rs.10,000 crore was transferred from RSF and Rs. 5,000 crore
from GBS to RRSK.

There was an expenditure of Rs.15,023.88 crore from the fund. By

funding replacement and renewal of assets through this Fund instead of
DRF, railways have reduced the appropriation to DRF, thereby. Presenting
the working expenses and operating ratio in a better light.
 Financial Health of Railways
C&AG Reports

IRFC lease charges from GBS: (Report No.13 of 2021 of C&AG of India)

During the year 2019-20, IR spent Rs.10,462 crore towards capital

component of IRFC lease charges from GBS.

 Audit observed that for the last three years, the entire lease charges
(Principal component) were being paid from the Budgetary Support.

Ideally the repayment of lease charges to IRFC should have been made
from Capital Fund (which is sourced from revenue surplus).

This arrangement of repayment to IRFC from GBS is not a healthy

trend and would deprive the railways of additional investments that
could have been made on capital works.
 Financial Health of Railways
C&AG Reports -1/2
Inadequate resources for debt servicing:
IR to pay lease charges to IRFC towards principal and interest
component. The principal component is capital expenditure of Railways.

 In 2022-23, allocation towards payment of principal component of

lease charges is estimated at Rs 22,188 crore, an increase of 51% over
2021-22 (Rs 14,702 crore as per Revised Estimates).

CAG (2020) had observed that ideally, the principal component of lease
charges should be paid from the Capital Fund which is a dedicated fund
to repay the principal component of market borrowing and financing
works of capital nature. However, no allocation has been made to this
fund between 2015-16 and 2021-22.

 In 2022-23, apportionment to capital fund is estimated to be Rs 2,360

crore. It is noted that appropriation to the Capital Fund is made from net
revenue after meeting obligatory revenue expenditure.
 Financial Health of Railways
C&AG Reports -2/2
Inadequate resources for debt servicing:

It is further observed that no appropriation is being made to the

Capital Fund due to inadequate internal resources. Hence, gross
budgetary support provided by the central government has been
used to pay the principal component of lease charges.

 CAG (2020) observed that utilization of gross budgetary

support for repayment of lease charges is not a healthy trend as
it deprives Railways of additional investments in capital works.

CAG (2019) earlier had observed that if obligations towards

IRFC have to be met from budgetary support, the government
might as well borrow directly from the market, as the cost of
borrowings would be lower.
 Financial Health of Railways
C&AG Reports
Freight advance received from National Thermal Power Corporation
(NTPC) (Report No.10 of 2019 of C&AG of India F.Y 2017-18)
Audit observed that IR had received freight advance of Rs. 5,000 crore
(inclusive of GST of Rs. 238.10 crore) in March 2018 from NTPC. This
was towards transport of coal during the financial year 2018-19. IR
treated it as goods earning for the year 2017-18.
The inclusion of the advance freight in the goods earning for the
financial year 2017-18 was justified on the ground that Government
Accounts are prepared on cash basis.
Indian Railways had received this freight advance for the services to be
provided in the next financial year (2018-19),the Net Surplus after
meeting all revenue liabilities dipped to Rs. 1,665.61 crore in 2017-18 as
against Rs. 4,913 crore in 2016-17.
This was despite the Railways being exempted from the payment of
dividend from 2016-17 onwards. In fact, the Railways would have ended
up with a negative balance instead of surplus but for this arrangement of
advance freight of Rs. 4,761.90 crore13 taken after signing of MoU with
NTPC in March 2018.
 Financial Health of Railways
C&AG Reports
Operating Ratio – Window Dressing :(Report No.8 of 2020 of
C&AG of India F.Y 2018-19)

Against the target of 92.8 per cent in the BE, the OR of Railways
was 97.29 per cent in 2018-19. This meant that railways spent
Rs. 97.29 to earn Rs.100. As compared to the OR of 98.44 per
cent during the previous year, there was marginal improvement
in 2018-19. This was primarily due to the reason that working
expenses grew at lower rate (5.09 per cent) as compared to
previous year (10.57 per cent).

The OR of Indian Railways reached an all-time high of 98.4 in

2017-18, which marginally came down to 97.29 per cent in 2018-
19. Further, if advance freight of ` 8,351 crore (pertaining to
2019-20) from NTPC and CONCOR was not included in the
earnings of 2018-19, the OR would have been 101.77 per cent
instead of 97.29 per cent. IR resorted to window dressing in order
to project better operating ratio.
 Financial Health of Railways
Initiatives in - IR Budget: 2022-23

Indian Railways to develop new services and other logistic services for
small farmers, and small and medium enterprises.
IR also take steps towards integration of postal and railway networks
to provide seamless solutions for movement of parcels.

 PM-Gati Shakti Cargo Terminals(100 Terminals) for multimodal

logistics facilities to be developed over next three years.
 Multimodal connectivity between mass urban transport and railway
stations to be facilitated on priority.

400 new-generation ‘Vande Bharat’ trains to be manufactured over

next three years.
 2,000 km of network to be brought under Kavach, the indigenous
technology for safety and capacity augmentation.

 ‘One Station-One Product’ concept will be popularized to help local

businesses and supply chains.
 Financial Health of Railways
Status of initiatives of IR Budget: 2021-22
Proposal Status

Land Monetization: RLDA has

identified Railway assets of:
A National Monetization Pipeline of 111 Railway land parcels, (ii) 84
potential brown field infrastructure Railway colonies, (iii) four Hill
assets taken up. A new option for Railways in Darjeeling, Kalka-
infrastructure construction Shimla, Matheran and Nilgiri, (iv)
Karnail Singh Stadium & 15 other
stadiums, and (v) 84 Multi-
Functional Complexes (MFCs). 13
MFCs have been completed and
balance are in different stages.
Monetization of DFC is planned to be
taken up after the Western DFC and
Railways will monetise Dedicated Eastern DFC become fully operational.
Freight Corridor (DFC) assets for Private Train Operators: Bids were
operations and maintenance, after invited in July 2021 for private sector
commissioning. participation in operating trains in 12
clusters. In all, five bids were received
for three clusters. No bids were received
for the remaining nine clusters
 Financial Health of Railways
Status of initiatives of IR Budget: 2021-22
Proposal Status

The strategic divestment of 30.8% equity

in CONCOR. Department of Investment
and Public Asset Management has
CONCOR Divestment appointed Advisors for this purpose.
Issuance of Expression of Interest is the
next step, will be issued after
finalization of Railway's proposed Land
License Policy.

The NRP is prioritizing projects as super

National Rail Plan (NRP): Indian critical/critical and fixing the timelines.
Railways has prepared a National Rail Vision 2024 has been developed as part
Plan for India – 2030. The Plan is to of NRP for execution of super
create a ‘future ready’ Railway system critical/critical projects. The NRP has
by 2030. also emphasized the justification for
new DFC corridors for which surveys
are underway. In addition, the NRP lays
a pipeline of projects to be completed by
2030, which are in process for inclusion
in future budgets as per timeframe
provided in the NRP.
 Financial Health of Railways
Status of initiatives of IR Budget: 2021-22
Proposal Status

Capital Expenditure: A record sum of In 2021-22, gross budgetary support

Rs 1,10,055 crore for Railways, of for capital expenditure is estimated to
which Rs 1,07,100 crore is provided be Rs 1,17,300 crore (revised
for capital expenditure. estimates).

Commissioning of DFCs: It is As of March 2021, total 1,110 Km has

expected that Western Dedicated been commissioned out of total 2,843
Freight Corridor (DFC) and Eastern Route km. Balance to be
DFC will be commissioned by June commissioned section-wise in phases
2022. The Sonnagar – Gomoh Section by June 2022. Approval of Public
(263.7 km) of Eastern DFC will be Private Partnership Appraisal
taken up in PPP mode in 2021-22. Committee received for Sonnagar-
Gomoh-Dankuni section of 274.3 km Gomoh section on December 27,
will also be taken up in short 2021.
succession. Preliminary reports are targeted by
New DFCs: (i) East Coast corridor January 2022 including FIRR and
from Kharagpur to Vijayawada, (ii) EIRR, and Final Reports by October
East-West Corridor from Bhusaval to 2022.
Kharagpur to Dankuni, and (iii)
North-South corridor from Itarsi to
Vijayawada.
 Financial Health of Railways
Status of initiatives of IR Budget: 2021-22
Proposal Status
Electrification: Broad Gauge Route
Kilometers (RKM) electrified is expected
to reach 46,000 RKM by the end of Total 47,807 RKMs (74%) have
2021 from 41,548 RKM on October 1, been electrified up to December
2021. 100% electrification of Broad- 31, 2021.
Gauge routes will be completed by
December 2023.
Introduction of Vista Dome LHB
coaches: To introduce the aesthetically 20 LHB VISTADOME coaches
designed Vista Dome LHB coach on have been manufactured till
tourist routes to give a better travel December 31, 2021. (7 in
experience to passengers. 2020-21 and 13 in 2021-22)
Safety: High density network and highly
utilized network routes of Indian 23,215 RKM work has been
railways will be provided with an approved by competent
indigenously developed automatic train authority.
protection system that eliminates train
collision due to human error. (Kavach)
 National Monetization Plan -1/2

In August 2021, the central government launched the National

Monetization Pipeline (NMP). This Plan will be implemented over four years
(between 2022-23 and 2024- 25).

Under National Infrastructure Pipeline, about 15%-17% of the aggregate

outlay is expected to be met through innovative mechanisms such as asset
recycling and monetization.

NMP aims to monetize assets which are central to business objectives of a

government body and are being utilized for delivering infrastructure
services.

Monetization under NMP will not involve disinvestment and monetization of

non-core assets such as land, building, and pure play real estate assets.

Under NMP, value of Railways’ assets to be monetized is estimated to be Rs

1,52,496 crore. This is about 26% of the value of all the assets of the central
government covered under NMP (six lakh crore rupees in value terms).
 National Monetization Plan -2/2

Asset Class Details

Railway Stations 400 (5.5% of total stations)
Passenger Trains 90 (5% of total trains)
Railway Track 1 route of 1,400 km, (2% of
network)
Konkan Railways 741 km
four in number
Hill Railways (a total of 244 km route)

Railway owned Goods sheds 265 : 21% of total goods sheds

Dedicated Freight Corridor 673 km :20% of total DFC

network
(DFC) track and allied infra
Railway colonies and stadia
(Source: NITI Aayog) 15
 Network expansion and Modernization

General Observations:

Railways has not been able to meet some key physical targets for
expansion and modernization in recent years. It has missed its budget
targets in all three years between 2017-18 and 2020-21 for:(i)
construction of new lines, and (ii) gauge conversion.

While examining the progress of construction of new lines, the

Standing Committee on Railways (2020) had observed that revision in
allocation towards capital expenditure requires reworking of priorities
and rescheduling of activities, which leads to tardy progress in the
construction of new lines.

 In 2018-19 and 2019-20, Railways also missed targets for

electrification of railway lines. Target that was Railways aims to achieve
100% electrification of all broad-gauge routes by 2023.

As per revised estimates for 2021- 22, achievement will be less than
the initial target in case of wagons and track renewals.
Performance Review of IR
Performance of Earnings & Expenses
High Lights of Performance
Network expansion – Capital Expenditure
Network expansion – Source Funds
Network expansion – Gross Budgetary Support
 Initiatives in Budget 2022-23

•Vande Bharat
Trains
•Kavach

•One Station
One Product
•NMP
 Initiatives in Budget 2022-23

•logistic services for

•Integration of Postal
small farmers, and
& Railway Network
MSMEs

•PM Gati Shakti •Multimodal connectivity

between Urban
Cargo terminal transport & Rly Stations
NMP – National Monetization Pipeline -1

> Launched in August, 2021

> Period – 4 Years (From 2021-22 to 2024-25)

> Monetization literally means to convert something into money.

> In a monetisation transaction, the government is basically transferring

revenue rights to private parties for a specified transaction period in
return for upfront money, a revenue share, and commitment of
investments in the assets

> Talking about Brownfield Assets.

NMP – National Monetization Pipeline -2

> Monetisation of "Rights", not Ownership. That means

primary ownership of the Assets continues to be with
the Govt.

> Railway’s share in NMP - 26 % i.e., Rs. 1.53 Lakh

Crores out of Target of Rs. 6 Lakh Crores.
 NMP – National Monetization Pipeline -3

Area Covered under NMP

Railway stations 400 Nos. (5.5% of stations)
Passenger trains 90 Nos. (5% of total trains)
Railway track 1 route of ~1,400 km (2% of
network)
Konkan Railways 741 km (Entire network)
Hill Railways 4 Nos. , 244 km route
Railway owned Good 265 Nos. (21% of total good sheds)
sheds
DFC track and llied 673 km (20% of total DFC
infrastructure
network)
Others–Railway colonies 15 Railway stadiums &
and stadiums
selected Railway Colonies
 PM’s Gati Shakti
> Gati Shakti – A Digital Platform
>100 PM Gati Shakti Cargo Terminals
during the next 3 Years
> To bring 16 Ministries including
Railways & Roadways together
>Integrated planning & coordinated
implementation of Infrastructure
connectivity Projects.
>Contracts for multi-modal parks at four
locations will be awarded during the next
fiscal
 Kavach

 The Kavach is an ATP – Automatic Train Protection - Part of

PM’s Atma Nirbhar Bharat
 Developed by RDSO in partnership with the Indian Industry
 Cutting edge electronic system that meets Safety Integrity
Level – 4 criteria
 Planned for 2000 KMs of Network under Kavach
 Advantages: 1. Preventing trains from passing the Danger /
Red Signal. 2. Prevents collision between two locomotives
equipped with a functional KAVACH system by applying
automatic brakes.
Vande Bharat Trains – Train 18

> 400 Trains – Next 3 Years (2022-25) Fully AC Train with a speed of 160
kmph
> Semi High speed Intercity Train. Engine less train. Driven by a self-
propulsion module sans/without a separate locomotive.
> Rather than being pulled by a locomotive, 'Train 18' sets are powered by
traction motors fitted underneath each coach to render them self-
propelled, just like metro trains.
> Compact set/ pack of 18 coaches. Coaches cannot be separated like in
regular trains.
> Developed by ICF, Chennai.
> Estimated cost - Rs. 100 Crores
> Footstep in a coach's doorway slides outward only when the train stops
at a station.
> First train18 set is named as "Vande Bharat Express" and plying between
New Delhi and Varanasi.
> Regenerative braking system - 30% savings in Electricity.
Network expansion & Modernization

> Railways – Not able to meet key physical targets

for Network expansion in last 3 years. (Details in
Next slide)
> 100 % Electrification of all BG routes by 2023.
 Physical Targets : 2022-23

2020-21 2021-22 2022-23

Key Physical
Targets Target Achievement Target Achievement
Target
New Lines (RKM) 500 286 300 300 300

GC(RKMs) 600 470 500 500 500

Double 1,900 1,614 1,600 1,600 1,700

Lines(RKM)
Diesel Locos --- 10 0 0 0

Electric Locos 725 754 905 981 685

Coaches 6,534 4,903 6,695 8,115 7,551
Wagons(Vehicles) 12,000 10,062 12,000 9,600 13,000

Track Renewals 4,000 4,363 4,000 3,600 3,700

(RKMs)
Electrification 6,000 6,015 6,000 6,000 6,500
(RKMs)
Thanks