Budget 2022: What's in store for Indian Railways?   

Indian Railways. Representative image.

Expanding Vande Bharat train sets, innovating new wagons, including one specifically targeted at carrying lightweight cargo from small businesses and promotion of new technologies like Hypeloop are among the expectations of Indian Railways from the budget for the next financial year, said two government officials aware of the matter.

There may be a broad statement around the transporter’s plans to reduce its carbon footprint on the roadmap to the goal of achieving net-zero emissions, said a third official with knowledge of the matter. The final form of the Railways-related announcements in the upcoming budget is still taking shape, he added.

One of the officials quoted above said on condition of anonymity that although passenger revenue has been hit by the COVID-19 pandemic, an increase in capital expenditure is expected so that Railways could serve both passengers and freight customers better.

He declined to comment on the size of the increase. Some media reports have claimed that the year-on-year increase in the budgetary allocation to Indian Railways could be to the tune of 20 percent to touch Rs 2.5 lakh crore in the financial year 2022-23.

Small business 

“We can expect some announcements in the budget around ways to attract small cargo and medium- and small-scale businesses. Railways wants to become of greater value to smaller businesses in the country,” one of the officials cited above said.

One of the early thoughts in the Railways is to design freight wagons with distributed power on the lines of the Vande Bharat Express, a second official said.

It will not need a separate, heavy-haul locomotive to pull lightweight cargo, thus saving energy. It can accelerate and decelerate faster, which means it can stop at shorter distances, and drop off small-size boxes at more locations.

As a part of its strategy to attract more cargo, Indian Railways will also promote ways to introduce high-capacity wagons, the first official said. One such idea is to target parcel cargo – for which Railways aims to refurbish coaches that are being phased out.

Another option is trying out innovations around smaller containers that can fit into trains as well as trucks. Such innovations have been termed Gati Shakti by the minister of railways, Ashwini Vaishnaw.

Seeking higher share of freight traffic

Indian Railways has traditionally been a bulk, heavy cargo transporter, carrying coal, petroleum, minerals and cement, among other commodities. Now it aims to increase its share in total cargo moved across the country to 40 percent from the current level of about 28 percent.

It is targeting other types of cargo including lighter weight goods that are largely transported by road at present.

Moneycontrol recently reported how keen the railway minister is about container innovations that he estimated could bring extra freight to the tune of hundreds of million tonnes, mainly lightweight goods from small businesses,  valued at tens of thousands of crore rupees.

Subsequently, Railways also introduced a Gati Shakti terminal policy, allowing large customers who have developed their own goods terminals to open up the space to others.

Vande Bharat 

For passengers, the budget may provide a push to more trains on the lines of the Vande Bharat Express, a semi-high-speed train that looks like a Bullet Train, one of the officials cited above said.

At present, two Vande Bharat Express trains are in operation on the Delhi-Varanasi and Delhi-Katra routes. Vande Bharat has been one of the pet projects of Prime Minister Narendra Modi.

A tender to bring out 44 more such train sets was awarded last year. Subsequently, on August 15, as India celebrated Independence Day, Modi announced plans to roll out Vande Bharat trains that will connect 75 destinations in the country in the 75th year of independence. After taking charge in July, the railway minister reviewed the project in detail.

Subsequently, Indian Railways floated 10 tenders for 58 such train sets in 2021 that have not been finalised yet.

“Meanwhile, at its factory, ICF has readied a set of bodies (coach shells), but it is waiting for the propulsion systems (which are the electrical portions that are fitted under the floor of the coach and are the heart of the train set) from the vendor who won the project, Hyderabad-based engineering firm Medha Servo Drives. As a result, the first such train that ICF will roll out is getting delayed,” the third official cited above said.

Eye on Hyperloop, net-zero emissions 

A futuristic technology that Railways may push in the upcoming budget is Hyperloop – an ultra-high-speed passenger and goods transportation technology still in its nascent stage.

“This will be more on the lines of a pilot project to assess the technology feasibility given the overall push for greener options within Railways,” the third official said.

Hyperloop is a term coined by Elon Musk, CEO of Tesla Inc., for technology using a big vacuum-sealed tube or a system of interlinked vacuum-sealed tubes with very low air pressure through which a coach, or pod as it is popularly called, can travel largely free of air resistance or friction.

Port operator DP World, which owns a stake in Virgin Hyperloop, said in October 2021 that the technology may be introduced in India before it debuts in Dubai. The Maharashtra government has been pursuing a hyperloop system as well.

As India considers its options, Sudhanshu Mani, former general manager of the Chennai-based Integral Coach Factory, who spearheaded the Vande Bharat or Train 18 project, batted for a special contract that helps India adopt the technology while seeking the best deal for itself.

In addition, steps including full electrification of railways and other technologies that may help railways achieve its target of becoming a green transporter with net-zero emissions may be addressed in the budget.

Indian Railways has set the target of becoming the world’s first 100 percent green railway system by 2030. As a sub-goal, it is seeking to achieve electrification of all its routes by 2023. 

Infrastructure theme 

Overall, the government’s focus on infrastructure is expected to continue in the budget. Industry stakeholders in the infrastructure sector are also hoping for an extension of the productivity-linked incentive scheme to manufacture railway containers within and rail equipment in India.

Sujatha Narayan, senior vice president and country leader, India Region, Wabtec Corporation, called for productivity-linked incentives for rail equipment makers.

“Introducing production-linked incentives for railway manufacturers and exporters promoting Make-in-India would be encouraging while also fast-tracking the implementation of projects and supporting the manufacturing ecosystem,” said Alain Spohr, managing director, Alstom India and South Asia.