Economy

Railways streamline FY26 investment plans for slow-moving, end-of-life JVs & SPVs

Indian Railways is bringing down investments across its PSUs, SPVs and JVs, by 20 per cent for FY26, according to Budget documents, bringing the total to ₹22,445 crore. Major reductions were seen in the Dedicated Freight Corridor Corporation of India Ltd, while a flattening of investments are expected in the Bengaluru Suburban Transport (K Ride) project, Bullet Train project and Kolkata Metro Rail Corporation.

Revised estimates for FY25 across the category stood at ₹27,571 crore.

The reduction amounts to around 32 per cent when compared to the BE FY25, where investments were pegged at ₹32,761 crore.

Railways Minister, Ashwini Vaishnaw told businessline, “Some of the projects are nearing the end-of-investment cycle or have made slow progress, prompting a streamlining.“

Budgetary support for Railways has been flat for FY26 at ₹252,000 crore, while internal and extra Budgetary resources — for PPPs — are fixed at ₹13,000 crore.

There is, however, no additional fundraising plan from the markets including through the IRFC (Indian Railway Finance Corporation). In FY25, additional provisions of ₹317.20 crore and ₹60 crore were made for the issue of bonus shares of RITES and CONCOR, respectively.

Big Cuts

Investment cuts came for the Dedicated Freight Corridor project, down by 90 per cent to ₹500 crore. It was ₹5,500 crore in FY25-RE. Actual investment in FY24 stood at ₹12,241 crore.

“The investment phase of the project is nearing its end. It’s almost complete and therefore, our investments in it have been adjusted accordingly,” Vaishnaw said. Nearly 96 per cent of the project is complete. The project has two arms, Eastern and Western, with around 100 km of the western end are expected to be completed over the next couple of years.

According to the Minister, the focus is on “network improvements,” with the entity acting as both a track and cargo operator – responsible for the operation and maintenance of the tracks. The corridor’s network will be integrated with the existing rail networks.”

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In the case of ‘K Ride,’ the investment is around ₹350 crore, a decrease of 22 per cent compared to FY24 actuals, but unchanged at FY25 RE level.

“There are some issues with the project which are currently being worked out,” Vaishnaw said.

For Kolkata Metro Rail Corporation and Bullet Train projects (National High-Speed Rail Corp), investments are flat (REFY25 to BEFY26) at ₹500 crore and ₹19,000 crore, respectively.

Two other Kolkata metro projects present contrasting pictures. For instance, the Dum-Dum airport-New Garia segment (connecting northern fringes to southeastern areas) saw capex from the Sovereign Green Fund being halved to ₹720 crore (from ₹1550 crore as per BE FY25). But, for the Joka-BBD Bagh-Majerhat segment (connecting southern fringes via the central business district), the allotment was up 8-10 per cent to ₹915 crore.

Cargo Push

While the national transporter is anticipating a flat growth rate in cargo, at 4 per cent for the second consecutive year, passenger traffic is expected to grow substantially by 16 per cent. Cargo volumes are expected to surpass 1.6 billion tonnes next fiscal – a record, and revenues are being pegged at ₹188,000 crore (higher than RE FY25 of ₹180,000 crore).

“We saw substantial cargo growth over the last few years; and because of the high base effect, growth rates are seen moderating,” Vaishnaw explained.

Pasenger revenue are expected at ₹92,800 crore (vs ₹80,000 crore).



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