NEW DELHI: The Economic Survey for 2025–26, tabled in Parliament on Thursday, stated that the rationalisation of passenger fares over the past five years has had an impact on freight earnings.
According to the Survey, the Railway Ministry rationalised passenger fares on three occasions during this period, leading to a gradual decline in the share of freight earnings in total revenue from 68% to 65%. It further projected that this share could fall to 62%.
The survey highlighted the issue of cross-subsidisation in railway traffic, under which profits generated from freight services are used to offset losses incurred in passenger and other services.
“During the last five years, passenger fare of the railways has been rationalised on three occasions, i.e., on January 1, 2020, July 1, 2025, and December 26, 2025, and consequently, the share of freight earnings in gross traffic receipts declined gradually from 68% in the financial year-23 to 65% in financial year-25 and is budgeted to be 62% in financial year-26”, the Economic Survey report mentioned.
Referring to the financial year 2022–23, the survey noted that freight earnings accounted for around 68% of the Railways’ gross traffic receipts, which represent total earnings.However, profits from freight operations were used to compensate for losses in passenger and other services, resulting in an uncovered loss of Rs 5,257 crore from all the passenger operations.
“The Comptroller and Auditor General of India has recommended critically analysing the cost of passenger operations, taking steps to reduce its losses,” the survey said.