Indian Railways has revised its fare structure with effect from December 26. Under the new fares, passengers travelling up to 500 km in non-AC coaches will have to pay Rs 10 more. However, this fare hike will not apply to suburban or local train services and Monthly Season Tickets (MSTs). There is also no increase in fares for ordinary class journeys covering distances of up to 215 km, according to the Ministry of Railways.
For Mail and Express trains, fares in non-AC coaches have been increased by two paise per kilometre, while AC class fares have also gone up by two paise per kilometre. According to Indian Railways, this rationalisation of fares is expected to help generate around Rs 600 crore in additional revenue during the current year.
Rising operational and manpower costs
The railways said that over the past ten years, its network and operations have expanded significantly, connecting even remote parts of the country. To manage this growing scale of operations and to further strengthen safety measures, Indian Railways has increased its workforce.
“Consequently, manpower cost has increased to Rs 1,15,000 crore. Pension cost has increased to Rs 60,000 crore. Total cost of operations has increased to Rs 2,63,000 crore in 2024–25,” it said in a statement.
To manage these rising expenses, Indian Railways said it is focusing on boosting freight or cargo loading, along with making a limited adjustment in passenger fares.
Strategic focus on freight and safety
It added that sustained investments in safety and operational improvements have led to better outcomes, with India now becoming the second-largest cargo-carrying railway system in the world.
“Due to these efforts on safety and improved operations, railways have been able to substantially improve safety. India has become the second-largest cargo-carrying railway in the world,” it said.
The railways also highlighted its improved efficiency, citing the successful operation of over 12,000 additional trains during the recent festival season as an example of better planning and execution.