Indian Railways’ capex on the slow track

By: |
New Delhi | September 24, 2015 12:35 AM

While the overall railways-controlled capex is flat year-on-year, there are signs of re-allocation towards focus areas such as doubling and electrification; however, doubling remains well below the budgeted level run rate

Although it is not short of funds, the pace of capital expenditure at Indian Railways doesn’t seem to have gathered speed, reports fe Bureau in New Delhi. In the five months to August, capex on key areas such as electrification, new lines, doubling and renewal of tracks, conversion of gauges and rolling stock has been virtually flat at Rs 14,700 crore. Numbers crunched by Ambit Capital show that spends on rolling stock are down 60% year-on-year while those on track renewals are down 24% y-o-y. Some of this has been offset by higher spends on other areas — for instance, more new lines are being built and more of them electrified.

The total spends at Rs 21,300 crore are up 12% y-o-y with funds having been channelled into joint ventures and SPVs of Northern Railways. Meanwhile, revenues have risen 10% y-o-y and are around 8% below target. That appears to have pressured the operating ratio which at 92.6% is above the targeted 88.5% for the first five months.


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