The upcoming Union Budget for 2025-26 is expected to prioritise the railways sector over highways, marking a strategic shift in infrastructure focus. According to a report by Nuvama, railways are likely to receive increased allocations, bringing them closer to the funding levels of the highways sector.
In the previous financial year (FY24), the highways sector was allocated Rs 2.70 lakh crore. However, the upcoming budget is anticipated to lean in favour of railways, reflecting the government’s changing infrastructure priorities.
Record-High Railway Budget in Recent Years
In the last budget for FY25, railways were allocated a record-high budget of Rs 2.5 lakh crore, a significant increase compared to Rs 2.4 lakh crore in FY24. This allocation is nine times higher than the budget allotted in 2013-14. Meanwhile, the highways sector received Rs 2.78 lakh crore for FY25.
The report underscores the environmental and logistical benefits of rail transport over roadways. It highlights that a single freight train can replace hundreds of trucks, significantly reducing greenhouse gas emissions by up to 75 per cent.
Despite being the world’s fourth-largest railway network, India’s rail share in freight transportation has seen a steady decline. Between 1950-51 and 2021-22, the running track length of Indian Railways expanded from 51,000 km to over 102,000 km. However, its share in freight transportation has plummeted from 85 per cent in 1951 to 60 per cent in 1991, and further down to 27-28 per cent in 2022.
Challenges Faced by Rail Freight Transport
Currently, about 70 per cent of freight movement in India depends on roadways, with trucks consuming more than half of the country’s petrol and diesel. Over the past decade, the road network has doubled to 150,000 km of national highways, further shifting freight reliance towards roads.
Additionally, the absence of dedicated freight corridors and robust rail connectivity to non-major ports has added to the growing dependence on trucks, impacting the efficiency and cost-effectiveness of logistics.
Government Initiatives to Boost Rail Infrastructure
The government is addressing these challenges by focusing on enhancing rail infrastructure to reduce logistics costs and improve freight transport efficiency. Efforts are underway to develop dedicated freight corridors, enhance connectivity to ports, and modernise railway infrastructure.
The anticipated shift in budget allocation aims to revitalise railways’ role in freight transport, fostering a more sustainable and cost-effective logistics ecosystem. With improved infrastructure and increased investment, railways are set to play a crucial role in shaping India’s transportation landscape in the years to come.
(With ANI inputs)