Railway Privatization
Railway Privatization
Overview
Railway Privatization in India refers to the gradual opening of rail infrastructure, operations and passenger services to private sector participation while Indian Railways (IR) retains ownership of the national rail network. The policy aims to bring investment, technology and managerial efficiency without privatising the entire system.
Key Facts & Figures
| Fact | Detail |
|---|---|
| First private train under PPP | Tejas Express (Delhi-Lucknow) flagged off on 4 Oct 2019 |
| Operating agency of Tejas | IRCTC (Indian Railway Catering & Tourism Corporation) |
| Second Tejas route | Mumbai–Ahmedabad, launched 17 Jan 2020 |
| 100% private train project name | “Bharat Gaurav” scheme launched Nov 2021 |
| Private trains announced in 1st batch | 12 routes (109 origin-destination pairs) – May 2020 bid |
| Investment target from private trains | ₹30,000 crore (~US $4 bn) |
| Concession period for private trains | 35 years |
| Revenue-sharing model | Gross Revenue Share (GRS) – lowest bid wins |
| First private freight terminal | ICD Whitefield (Bengaluru) – 2005 |
| First private container train operator | Box’N’Rail (2007) after Container Policy 2005 |
| Dedicated Freight Corridor (DFC) O&M concession | 30-year O&M contract awarded to DFFCPL (2021) |
| Station redevelopment flag-ship | Habibganj (Bhopal) – first PPP station (awarded 2017) |
| National Monetisation Pipeline (NMP) stations target | 400 railway stations (2022-25) |
| PPP policy for track, signalling & rolling stock | “Make-in-India” + 75% domestic procurement mandatory |
| Highest bidder for 12 trains | RK Associates – quoted 0.54% revenue share |
| Current status of 12-train bid | Annulled by Railways in July 2022; fresh bid under drafting |
Important Points
- Indian Railways never privatised; only selected services opened to PPP.
- Ownership of tracks, land and signalling stays with Ministry of Railways.
- Private trains pay haulage charges (track usage fee) + energy charges + share of gross revenue.
- IRCTC-run Tejas trains follow dynamic fare pricing; no subsidy, no concession.
- Private passenger trains must adhere to 130 km/h max speed, LHB coaches & Kavach safety features.
- 90% of train crew (loco-pilots, guards) still Railway employees even on private trains.
- Private operators free to procure rolling stock globally but must maintain in Indian facilities.
- “Bharat Gaurav” trains can be themed (religious, cultural) and need not follow regular mail/express fare.
- No privatisation of existing mail/express trains; only new “premium” services offered.
- Freight privatisation started earlier: container, tank & automobile trains allowed since 2005.
- National Rail Plan (NRP) 2030 targets 1600 km green-field lines through PPP.
- Private sidings and freight terminals now exceed 300, reducing Railways’ capital burden.
- Vande Bharat sleeper & Vande Metro next in line for PPP manufacturing, not operation.
- Land lease for private stations max 45 years; redevelopment must preserve heritage façade where applicable.
- Safety certification by RDSO & Commissioner of Railway Safety mandatory for all private rolling stock.
Frequently Asked in Exams
- Which was India’s first private semi-high speed train and who operates it?
- Difference between Tejas Express and the proposed 12 PPP trains.
- Revenue-share vs cost-share model in Railway privatisation.
- Name the two corridors on which private freight trains are most active.
- Constitutional status of Indian Railways – why full privatisation is not pursued.
BETA
