Indian Railways surpasses its FY22 revenue in nine months of FY23

Expects to end the year with earnings of Rs 2.35 trillion

With three months remaining in the current fiscal year, Indian Railways has already surpassed its total earnings of financial year 2021-22 (FY22), the railway ministry said on Friday. The national transporter has earned Rs 1.91 trillion so far in this fiscal year.

Union Railways Minister Ashwini Vaishnaw said on social media that revenue was “Rs 42,370 crore more” thus far this fiscal year with “71 days more to go”. The development comes less than two weeks ahead of the Union Budget, in which the Railways is expected to see a boost in allocation.

Though a break-up of the earnings was not available, it is estimated that about Rs 1.3 trillion was earned from the freight business, with approximately Rs 52,000-53,000 crore coming through passenger fare, and the rest through coaching, parcel services, and sundry receipts.

As of January 19, the Railways had ferried 1,185 million tonnes (mt) of raw materials and goods, which was 8 per cent higher than the whole of the previous fiscal year. However, owing to increased distance of transportation and using newly-built specialised wagons, the ministry has been able to raise its revenue by nearly 17 per cent year-on-year (YoY) in the same time, despite modest freight growth.

Official data shows, net tonne kilometres (NTKM), a metric used to show the distance travelled by freight trains, grew 12 per cent in the last 12 months. Concurrently, revenue per mt by the national transporter has also grown from Rs 101 crore to Rs 108 crore.

Coal continues to dominate the transporter’s freight basket even as it attempts to diversify to other commodities and become the preferred transporter for finished goods. Latest data shows coal loading is 62 mt higher than last year, while the total increase in overall freight is 80 mt. Meanwhile, both iron ore and steel have seen a decrease in traffic compared to the previous year, while other commodities witnessed modest growth.

In the FY23 Budget, the national transporter had set a target of 1,475 mt of freight loading and gross freight revenue of Rs 1.65 trillion, while passenger revenue was pegged at Rs 58,500 crore.

According to officials, the Railways will surpass both these numbers by March, ending the fiscal year with freight loading between 1,500-1,550 mt and total revenue of about Rs 2.35 trillion.

Experts pointed out that the national transporter needs to maintain a compound annual growth rate (CAGR) of 10 per cent to meet the freight targets envisioned in the National Rail Plan (NRP). The Centre wants to significantly increase the national transporter’s freight numbers, along with its modal freight share to 45 per cent by 2030.

The national transporter would need to account for over 3,600 mt in 2031 to meet its NRP targets. In the near term, it is targeting over 2,000 mt by 2024.