Railways Spent Rs 604.7 Billion on Passenger Subsidy in FY24

26 Jul 2025 CW Team

In a written response to questions from multiple Members of Parliament regarding the recent rail fare hike, Vaishnaw stated that the Indian Railways continues to offer one of the most affordable transport services globally, ferrying over 7.2 billion passengers annually.

"The total amount of subsidy provided in FY 2023–24 on passenger travel is provisionally estimated at Rs 604.66 billion, amounting to a 45 per cent subsidy on travel costs," he said.

He further clarified that fares were "rationalised" from 1 July this year, marking the first adjustment in more than five years. The fare increase is minimal, ranging from half a paisa to two paise per kilometre, depending on the class of travel.

According to the minister, there is no fare hike in second-class ordinary coaches for journeys up to 500 kilometres. Beyond that, the increase is limited to half a paisa per kilometre per passenger. Similarly, sleeper class and non-reserved first-class fares have seen a half paisa increase, non-AC classes in Mail and Express trains have risen by one paisa, while reserved AC classes have gone up by two paise per kilometre.

To ensure affordability for lower and middle-income passengers, Monthly Season Tickets (MSTs) and suburban train fares remain unchanged. Vaishnaw stressed that fewer than half of all passenger trips will witness any fare increase at all. For instance, low-income passengers travelling in general coaches for 500 kilometres will not face any additional charges.

The minister also noted that Indian Railways is undertaking projects to improve suburban infrastructure, including track upgrades and network expansion. Enhancing the frequency of both suburban and mainline services remains an ongoing priority, he added, subject to feasibility and available resources.

New Delhi – The Indian Railways provisionally spent Rs 604.7 billion in subsidies during the financial year 2023–24, covering 45 per cent of passenger travel costs, Railway Minister Ashwini Vaishnaw informed the Lok Sabha on Wednesday.In a written response to questions from multiple Members of Parliament regarding the recent rail fare hike, Vaishnaw stated that the Indian Railways continues to offer one of the most affordable transport services globally, ferrying over 7.2 billion passengers annually.The total amount of subsidy provided in FY 2023–24 on passenger travel is provisionally estimated at Rs 604.66 billion, amounting to a 45 per cent subsidy on travel costs, he said.He further clarified that fares were rationalised from 1 July this year, marking the first adjustment in more than five years. The fare increase is minimal, ranging from half a paisa to two paise per kilometre, depending on the class of travel.According to the minister, there is no fare hike in second-class ordinary coaches for journeys up to 500 kilometres. Beyond that, the increase is limited to half a paisa per kilometre per passenger. Similarly, sleeper class and non-reserved first-class fares have seen a half paisa increase, non-AC classes in Mail and Express trains have risen by one paisa, while reserved AC classes have gone up by two paise per kilometre.To ensure affordability for lower and middle-income passengers, Monthly Season Tickets (MSTs) and suburban train fares remain unchanged. Vaishnaw stressed that fewer than half of all passenger trips will witness any fare increase at all. For instance, low-income passengers travelling in general coaches for 500 kilometres will not face any additional charges.The minister also noted that Indian Railways is undertaking projects to improve suburban infrastructure, including track upgrades and network expansion. Enhancing the frequency of both suburban and mainline services remains an ongoing priority, he added, subject to feasibility and available resources.

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