The key focus areas for capital expenditure include the construction of new lines, doubling, traffic facilities, and rolling stock, among other expansion and modernization areas of expenditure | Photo Credit: RAO GN

The Union Budget on Sunday gave a big capex boost to Railways with a focus on capacity building and safety. Part of this capex boost will go towards high-speed rail corridors for the Southern States.

With the need for increased railway infrastructure and the Centre’s push to modernize Railways, the Union Budget on Sunday allocated a total capital expenditure of ₹2,93,030 crore for FY27, a 10.5 per cent rise from the revised estimates of FY26. The sector also received a total outlay of ₹2,78,030 crore in the Budget, which is the highest-ever allocation for the ministry.

The key focus areas for capital expenditure include the construction of new lines, doubling, traffic facilities, and rolling stock, among other expansion and modernization areas of expenditure.

In case of revenue expenditure, Indian Railways has budgeted for ₹2,99,500 crore in revenue expenditure, a 8 per cent rise from FY26 (RE) even as it under-spent in revex in FY26(RE) compared to FY25.

The capex of Railways from Government’s budgetary support is set to rise to ₹2,78,030 crore in FY27, a 10 per cent increase over the FY26 RE of ₹2,52,200 crore. Investment from Extra Budgetary Resources (EBR) is budgeted to rise to ₹12,000 crore in FY27 compared with the FY26RE of ₹10,000 crore, according to the Budget documents.

In case of revenue, Railways is budgeting for gross traffic receipts (GTRs) of ₹3,01,700 crore in FY27, a 8.4 per cent increase over the FY26 RE. Receipts include passenger revenue budgeted to grow 9 per cent at ₹87,300 crore in FY27.

However, a comparison of FY26 (RE) with the original Budgets shows that the ministry has fallen short of its GTRs for the fiscal by ₹23,000 crore.

However, given the slow growth in revenue in FY26(RE), the operating ratio remains tight at 98.9 per cent for the fiscal. The Railways anticipates this to improve to 98.4 per cent in FY27.

Besides the high-speed passenger rail corridor cutting across Mumbai, Pune, Hyderabad, Bengaluru, and Chennai among others, the Budget also outlined plans on the freight side with plans for a dedicated freight corridor to connect Dankuni in the East with Surat in the West.

Published on February 1, 2026