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294 Economic Survey 2021-22

Box 5: National Railway Plan

The National Rail Plan lays down the road map for capacity expansion of the railway network by
2030 to cater to growth up to 2050. It envisages the creation of a future ready railway system that
is able to not only meet the passenger demand but also increase the modal share of railways in
freight to 40-45% from the present level of 26-27%. The target of 40-45% modal share for railways
is necessary from the perspective of sustainability and also from the national commitments made
globally for reducing emission levels.(see chapter 6 on sustainable development and climate
change).

Unlike growth, which is linear, capacity grows in surges (sawtooth curve) depending on
project completion timelines.As per the National Rail Plan, the freight ecosystem is expected
to grow from the present level of 4700 MT to 8200 by 2030. At present the railway capacity is
barely able to carry 1220 MT which is around 26-27% of the modal share. The Plan provides
a pipeline of projects,which on completion will increase railway capacity to capture 45% of
freight traffic. Since the railways is already having a large number of sanctioned projects that
need to be completed before taking up new projects, it has been planned to increase railway
capacity in two surges. The first surge is to be provided by the Vision 2024 plan to prioritize and
complete sanctioned projects so that railway capacity does not fall far behind the targeted modal
share such that by the time capacity is finally created, the traffic would have shifted to another
mode. To prevent further bleeding away of modal share, railway capacity enhancing projects
have been categorized as Super Critical and Critical. 58 projects have been identified as Super
Critical and are targeted for completion by December2022. 68 projects have been identified
as Critical and have been targeted for completion by March 2024. These projects are focussed
at increasing capacity on routes that serve major mineral, industrial hubs along with ports and
major consumption centres.

In addition to these critical projects, the Ministry of Railway has also targeted 100% electrification
of its network by December2023 upgrading Delhi-Mumbai & Delhi-Kolkata corridors to 160 kmph
and also elimination of level crossings on the Golden Quadrilateral/Golden Diagonal routes. On
completion of Vision 2024 projects, in the second half of the decade, the aim is to commission new
Dedicated Freight Corridors and also High Speed Passenger Corridors, besides multitracking and
signaling upgradation of congested routes
The next 10 years will see a very high level of CAPEX in the railway sector as capacity growth
has to be accelerated such that by 2030 it is ahead of demand. Up to 2014,CAPEX on railway was
barely Rs45,980 crore per annum and consequently the railway was charecterized by high levels
of inefficiency and highly congested routes unable to meet the growing demand. Post 2014, a
conscious effort was made to improve the railway sector by substantially increasing the CAPEX.
The CAPEX outlay for 2021-22 is Rs 2,15,000 crs which is more than five times the 2014 level. As
more projects are taken on hand and several sources of capital funding are developed, the CAPEX
will increase further in coming years and the railway system will actually emerge as an engine of
national growth.