Rlys' freight receipts lag GDP, revival hinges on DFC and premium trains

Little Progress

- MANU KAUSHIK

INDIAN RAILWAYS' FREIGHT receipts lagged the rate of expansion of the nominal gross domestic product (GDP) in recent years, reflecting the lack of recovery in the operational parameters of the transporter.

Freight receipts grew 4% in FY24 and 7% in FY25, and are projected to grow at 4% in FY26, according to the figures revealed in the recent Union Budget. Nominal GDP grew by 9.7% in FY25 and the budget estimates (BE) for FY26 is 10.1%.

After the pandemic-induced slump, IR's passenger revenues recovered significantly, and are marginally outpacing GDP. However, the growth is still not sharp enough to meaningfully reduce the cross-subsidy of the passenger segment by freight. While the goal is to acquire freight traffic volumes from the roads segment by keeping freight rates regulated, there has only been a modest improvement in this regard. Freight loading from IR grew just 2.95% in FY25 and is seen to rise by 3.97% in FY26.