Railway Minister Mr. Suresh Prabhu announced the Railway Budget 2016-17 on 25th February 2016, with a plan of Rs. 1,21,000 crores. The plan proposed several things like keeping the fares same, and also suggested emphasis on finishing all ongoing projects over starting new ones.

Here are a few highlights of the Railway Budget 2016-17:

The Railways has set an ambitious 92% operating ratio target, as opposed to the existing 90 paise, which means that the Railways will be spending 92 paise from every 1 rupee earned as revenue. This is being done because of the 7th Pay Commission which had recommended a pay hike for railway employees.

The expected revenue for the next year is Rs. 1,84,820`crores. This is 1.1% higher than the revised target of FY 2016. The expected support from the government is r. 40,000 crores.

Three new categories of trains have been announced:

Tejas - trains operating at 130 km/hour, with world class on-board services

Hamsafar - All compartments 3-tier AC trains with an optional service for meals

UDAY (Utkrisht Double-Decker AC) - trains with increased capacity


Wi-Fi services will be commissioned at 100 railway stations this year, and at 400 station by the end of two years.

Lower berth quota for senior citizens will be increased, so will the number of railway coaches. The budget has sanctioned 44 new projects covering 5,300 kms, which will cost 19,000 crore.

Children’s menu will be available separately in trains. Baby food, hot milk and hot water will be available.

The Centre has proposed FM Radio Stations to provide their train-borne services by installing Public Announcement systems in trains.

Rs. 8.5 lakh crores will be spent in the next 5 years to modernise and improve railway infrastructure. The LIC has also agreed to fund Rs. 1.5 lakh crores in the next 5 years.

The Railways is targeting to improve punctuality to 95%, and increase average speed of all trains.

Two new loco factories will be set up under the Make-in-India plan.

Projects to connect New Delhi to Chennai, West Coast, and East coast will be put on fast track.

A first-of-its kind Rail Auto Hub will be set up in Chennai.

These are a few points from the Railway Budget presented yesterday. You can read more at Indianrailways [dot] gov [dot] in.

What do you think about the Railway Budget 2016-17? Send us your views on our Facebook and Twitter pages, or email us at jaagorein@gmail.com.

About the Expert:

Rishabh Parakh

Rishabh is a Chartered Accountant and a founder Director cum Chief Gardener of Money Plant Consulting, A leading tax and investment service provider He also writes for several leading publications in India.

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