The Railway Budget 2016 : An Overview

The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Prabhat Choudhary, MBA 2015-17, Vinod Gupta School of Management, IIT Kharagpur



The railway minister of India, Mr. Suresh Prabhu has presented the Railway Budget 2016 which seems to reflect the populist expectations of entire nation. He made all efforts to translate dream of Prime minster Narendra Modi into reality. The key highlights of the budget includes aiming to achieve 92 percent operating ratio, envisaging capital expenditure of Rs 1.21 lakh crore, spending 8.8 lakh crore on infrastructure, providing Wi-Fi facilities at 100 more stations this year, increasing lower berth quota for senior citizens by 50 percent, increasing use of social media to ensure transparency, providing 24X7 helpline for women and commissioning 19 km of new broad gauge track every day by 2018-19.

The railway budget seems to have a vision but lacks the specifics. It conveys us what it want to achieve but does not answer how the government will achieve this. But one thing is clear that there is change in mindset of political system. They are now more sensible about proposals to bring PPP (public private partnership) or FDI (Foreign direct investment) which government is willing to allow in all aspects of the railways except operations. However these proposals are yet to be materialize.

Prabhu’s budget shows the government’s intent to transform Railways as a crucial engine to economic growth and change the country as a high-growth manufacturing economy among emerging markets.

On the whole Prabhu’s 2016-17 Railway budget is a budget which try to please every section of society, which indeed shows promise of taking ahead the process of overhauling Indian railways through several small reform-steps rather than making big-bang announcements. But, the real challenge for Prabhu lies on the implementation-front.






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