By Sanjay Shah
Indian Railways is more than a transport system. It is the lifeline for millions. Daily wage workers commuting to cities. Families travelling for weddings. Farmers sending produce to distant markets. Pilgrims heading to temples. Students going home…
Every Budget touches this vast network in some way. The questions people ask rarely change: Will my train become better? Kya ticket sasta hoga? Kya train time pe chalegi?
Union Budget 2026-27, presented by Finance Minister Nirmala Sitharaman on Sunday, February 1, 2026, keeps railways in sharp focus. The numbers are big. The intent is clear. But big allocations do not always mean big change. Let us look at the key things that actually matter: the numbers, the priorities, the promises and the ground realities.
Record Numbers, But What Do They Hide?
Capital expenditure, including internal resources and extra-budgetary support, is pegged at ₹2.93 lakh crore. These are the highest figures ever. Last year’s revised estimate was ₹2.55 lakh crore. On paper, the jump looks strong.
But peel back the layers and the picture becomes more nuanced. A large part of this money comes from extra-budgetary resources – market borrowings, institutional loans and internal generation. The extra cash directly from the Union Budget is not as dramatic as the headline suggests.
The government is still betting heavily on capex to fix capacity, improve speed and enhance safety. That bet has been running for several years now. The results are mixed. Some routes have improved. Many others still crawl.
Where the Money Is Actually Going
Here is the rough breakup of railway spending priorities in this Budget:
- New lines, doubling and gauge conversion → ₹36,700 crore – This head covers fresh broad-gauge lines, doubling of single lines and conversion of metre-gauge sections. Progress has been slow. Land acquisition, forest clearances and cost escalations remain big hurdles. Many projects sanctioned a decade ago are still incomplete.
- Track renewal and safety upgrades → ₹25,000–30,000 crore (spread across heads) – Track renewals are critical. Old rails cause derailments. Kavach (automatic train protection) gets more funding, but full rollout on high-density corridors is still years away. Signalling modernisation and level-crossing elimination also take a share.
- Rolling stock (coaches, wagons, locomotives) → over ₹65,000 crore – Vande Bharat and Amrit Bharat production is being ramped up. Integral Coach Factory and Modern Coach Factory are working at full capacity. Freight wagons are getting fresh orders to improve loading efficiency. This is one area where visible change is already happening.
- Station redevelopment → ₹5,000–7,000 crore – Amrit Bharat station scheme continues. Over 1,300 stations are under various stages of upgrade. Big ones like New Delhi, Mumbai CST and Howrah are nearing completion. Smaller stations are getting basic improvements – better lighting, platforms, waiting rooms.
- High-speed and semi-high-speed corridors → ₹10,000–15,000 crore – Mumbai-Ahmedabad bullet train remains the flagship project. Seven new high-speed corridors announced in earlier budgets remain largely at the survey and planning stage. Land and funding challenges persist.
- Electrification and green energy → embedded in capex – Over 97% of the broad-gauge network is now electrified. The Budget keeps the momentum but does not announce any major new green initiative.
Passenger Experience: The Real Test
For the common passenger, three things matter most: fares, punctuality and comfort.
Passenger fares remain unchanged. No hike. No cut. That is a relief for daily commuters and long-distance travellers. Suburban fares in Mumbai, Delhi and Kolkata stay the same. Long-distance sleeper and general class tickets do not go up.
Passenger fares have been frozen for years, keeping travel affordable but straining railway finances. This puts pressure on the system.
Safety gets serious attention. Track renewals, Kavach rollout and signalling upgrades continue. Yet the pace is slow. Full Kavach coverage on busy routes may take another 3–5 years. Recent accidents remind everyone that safety cannot wait.
Vande Bharat services are expanding. Around 100 new trains are planned over the next two years. But breakdowns and maintenance issues have hurt reliability. Ordinary express and mail trains still carry the bulk of passengers. These trains need better maintenance and cleaner coaches.
Amrit Bharat trains (non-AC, affordable long-distance) are a welcome step. More routes are expected. This serves the aam aadmi who cannot afford premium travel.
Station redevelopment is progressing. Some stations now have malls, food courts and better accessibility. But many are still construction sites. Daily commuters want clean platforms and toilets more than fancy shops.
Freight: The Money Machine
Freight is railways’ real revenue driver. The Budget targets 1,700 million tonnes loading in FY27, up from 1,591 million tonnes in FY25. Dedicated Freight Corridors (DFC) are almost fully operational.
Eastern DFC is complete. Western DFC is close. Average freight speed can rise from 25 kmph to 50-60 kmph once both corridors are running smoothly. This saves fuel, reduces logistics cost for coal, steel, cement and fertiliser companies.
But roads are tough competitors. Trucks offer door-to-door service. Railways must improve terminal connectivity, reduce loading time and offer competitive pricing to gain market share.
Employment, Skills and Private Participation
Railways remains one of India’s largest employers. The Budget sustains jobs in manufacturing, construction and maintenance. Direct recruitment continues, but not at a massive scale.
Skill development is becoming critical. Modern signalling, rolling stock maintenance, digital ticketing and Kavach operations need trained people. The Budget hints at training support, but details are limited.
Private participation moves slowly. Private trains and station management are still in early stages. No big new PPP announcements in this Budget.
What Passengers and Users Should Realistically Expect
In the next 12–24 months, you are likely to see:
> More Vande Bharat and Amrit Bharat trains on select routes
> Slightly better punctuality on decongested corridors
> Gradual station upgrades in big cities
> Cleaner coaches on premium services
> Stable fares (no hike)
> Slower progress on unreserved and ordinary express trains
What you may not see soon:
> Zero accidents (safety improvements take time)
> Congestion relief on all busy routes
> Major reduction in waiting lists for general coaches
> Dramatic speed increases on most networks
The Bigger Picture
Railways is a long-gestation sector. Assets last 30-50 years. Investments made today show results after 5-10 years. Budget 2026 continues the capex push started in earlier years. It does not launch radical reforms. It does not cut corners on safety. It does not raise fares to fix finances.
That is deliberate. Railways is both a commercial enterprise and a social service. Balancing the two is never easy. The government has chosen the path of steady investment over big-bang changes.
The risk is clear. If execution lags, the record outlay will remain just a number. Projects will stretch. Costs will overrun. Public trust will erode.
The reward is also clear. If execution improves, railways can become faster, safer and more reliable. Freight will grow. Passenger experience will get better. The network will finally match the ambition.
Final Word? Union Budget 2026 gives railways its biggest-ever financial runway. The money is there. The plans are there. But railways, by nature, moves slowly. Change is incremental. Not dramatic. For passengers, this means patience. For freight customers, cautious hope. For policymakers, no room for complacency.
The journey is long. The Budget lays good tracks. Whether the train runs on time depends on how well the system is managed on the ground.
