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Indian Railways: The Economics of a Giant

Indian Railways at a Glance

The scale of Indian Railways - its network, passengers, freight and workforce - and why it is both a business and a public service.

Indian Railways is one of the largest railway systems in the world.

Scale

  • A route network of roughly 68,000 kilometres.
  • Carries over 2 crore (20 million) passengers on a typical day in recent years.
  • Moves over 1,500 million tonnes of freight a year.
  • Employs around 12 lakh people, one of the world’s largest employers.

Who runs it

Indian Railways is a government department under the Ministry of Railways, not a company. Since 2017, its budget has been merged with the Union Budget.

Business or public service?

Indian Railways plays two roles:

  • Business: it earns revenue from fares and freight.
  • Public service: it keeps fares low, connects remote regions and runs loss-making routes.

These goals often conflict.

Why it matters

  • Cheap mobility for millions of workers and students.
  • Freight for coal, cement, steel and grain.
  • National integration, linking regions.
A day on the rails

Every day, more people ride Indian Railways than live in many entire countries, from office commuters in Mumbai to families travelling across the country for festivals.

Thinking Indian Railways is a private company

It is a government department under the Ministry of Railways.

Key takeaways
  • Indian Railways has a route network of about 68,000 km.
  • It carries crores of passengers daily and huge freight volumes.
  • It employs around 12 lakh people.
  • It balances business goals with public service.
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