India Railway Development

Railway development is a key focus of the Union Budget of India (Union Budget), with a total allocation of US$16.5 billion, mostly on capital expenditure, including the development of railway freight corridors.  The National Rail Plan 2030 was introduced to create a future-ready railways system and to bolster investment into the railways sector.  The development of railway freight corridors aims to reduce costs for the logistics industry and is designed to promote the “Make in India” initiative.

Policy measures to expedite private sector participation in passenger train operations were also announced in the Union Budget.  The Ministry of Railways is in the process of selecting private parties to operate 109 trains across 12 clusters, comprising of 140 origin-destination pair of routes along the railway network.  This plan entails an investment of approximately US$4.1 billion and is projected to be operational starting in 2023.

The Government of India has outlined specific projects, which may provide commercial opportunities for U.S. exporters:

•    The Sonnagar – Gomoh Section (263.7 km) of the Eastern Railway, including a dedicated freight corridor, will be developed under a Public-Private Partnership (PPP) model in 2021-2022.  The Gomoh-Dankuni section, constituting 274.3 km, will follow the Sonnagar-Gomoh section. 

•    Future dedicated freight corridor projects are the East Coast Corridor from Kharagpur to Vijayawada, the East-West Corridor from Bhusaval to Kharagpur to Dankuni, and the North-South Corridor from Itarsi to Vijayawada.  The Government of India has announced plans to commission the Eastern and Western Dedicated Freight Corridors by June 2022 to reduce the logistics cost for the railway industry.

•    An electrified Broad-Gauge Route Kilometers (RKM) section is expected to reach 46,000 RKM by the end of 2021 from 41,548 RKM in Oct 2020.  This constitutes 72 percent of the total project. 100 percent electrification of Broad-Gauge Routes will be completed by December 2023.  Railway Electrification, improving energy efficiency of locomotives & trains and fixed installations, green certification for installations/stations, fitting bio toilets in coaches and switching to renewable sources of energy are parts of its strategy of achieving net zero carbon emission.

For more information on opportunities in the above sectors, please contact your nearest local U.S. Export Assistance Center or e-mail: Geoffrey Parish or Ritu Arora