Indian Railways Charges You ₹57 for a Ride That Costs ₹100. It Still Pays Its Own Bills.

Take a seat on an Indian train and the sums start going against the railway before the wheels turn. For every ₹100 it spends carrying you, your ticket pays it ₹57.

That figure comes from the Railway Minister, Ashwini Vaishnaw, in a written reply to the Lok Sabha in March 2026. Indian Railways gave ₹60,239 crore of subsidy on passenger tickets in 2024-25, which he described as a 43 percent concession for every person who travelled.

And a great many people travelled. The railway carried a record 741 crore passengers in 2025-26, a little over two crore a day. Amtrak, the American national passenger railway, had its own record year to September 2025 with 34.5 million trips. Indian Railways carries that many people in less than two days.

Yet by its own books, the railway pays for all of it. Salaries, fuel, repairs and the pensions of its retired staff come out of what it earns, and in 2024-25 it finished with ₹2,660 crore to spare. Most of the money that makes this work arrives in coal wagons.

Your ticket covers a little over half the trip

The discount has held for years. In March 2025 Vaishnaw told the Rajya Sabha that a kilometre of train travel cost the railway ₹1.38 while the passenger paid 73 paise, a subsidy of 47 percent. By his figures, the passenger subsidy was about ₹57,000 crore in 2022-23 and about ₹60,000 crore in 2023-24.

The ministry says it prices fares this way on purpose, to keep travel within reach of every income group. The cost accounts show how far that goes. Between 2018-19 and 2021-22, according to the national auditor’s figures summarised by PRS Legislative Research, every class of passenger service lost money in every year, except AC 3-tier and AC chair car, which covered their costs in some years.

So the sleeper berth and the second-class seat, which between them make up close to two-thirds of long-distance passenger traffic, run at a loss by design. Somebody has to pay the difference.

Coal pays the difference

That somebody is freight. In 2024-25 the railway earned ₹1,71,163 crore from goods traffic and ₹75,368 crore from passengers, so goods brought in more than twice as much. PRS calculates that freight has supplied an average of 68 percent of the railway’s internal revenue between 2017-18 and 2026-27.

The volumes keep rising. Indian Railways loaded 1,617 million tonnes of freight in 2024-25 and a record 1,670 million tonnes in 2025-26. The minister has placed it among the world’s three biggest freight railways, alongside those of China and the United States.

Coal is the core of it. In 2022-23 coal made up 48.19 percent of everything the railway loaded and 50.42 percent of its freight earnings, according to the Comptroller and Auditor General (CAG). The railway moved around 55 percent of all the coal sent out from India’s mines that year, and PRS estimates coal will still bring in 48 percent of freight revenue in 2026-27.

Every rake of coal that pulls into a power station is, in a small way, paying for someone’s train ticket.

The arrangement asks a lot of goods customers. NITI Aayog found that between 2009 and 2019 freight rates rose 91 percent while passenger fares rose 28 percent.

What an operating ratio of 98 means

Railways track their health with one number, the operating ratio. It is how many rupees the railway spends on running costs to earn ₹100. Below 100, the trains pay for themselves. Above 100, they do not.

Indian Railways’ ratio was 98.10 percent in 2022-23, 98.43 percent in 2023-24 and 98.22 percent in 2024-25, the latest year with final figures. So in 2024-25 it spent ₹98.22 to earn each ₹100. On traffic receipts of ₹2,65,114 crore, that left a net surplus of ₹2,660 crore. The year before, the surplus was ₹3,260 crore.

For 2025-26 the budget’s revised estimate puts the ratio at 98.82 percent and the surplus at about ₹1,957 crore. The final figures come with next year’s budget.

These are thin margins. What makes them worth a second look is what sits inside the ₹98.

The pension bill is inside the ₹98

In 2024-25 the railway set aside ₹59,500 crore for pensions, out of total working expenses of ₹2,60,769 crore. For 2026-27, PRS works out that salaries will take 41 percent of internal revenue and pensions another 25 percent.

That the railway carries its own retirees is written into how it is funded. India had presented a separate Railway Budget every year since 1924, a practice that began under the British, whose lines Indian taxpayers ended up paying for twice. In September 2016 the Union Cabinet folded that budget into the Union Budget from 2017-18, and laid down that the railway would keep meeting “all their revenue expenditure, including ordinary working expenses, pay and allowances and pensions etc. from their revenue receipts”.

The same decision wiped out about ₹2.27 lakh crore of capital on which the railway had paid the government a dividend every year. That payment, roughly ₹9,700 crore a year, stopped from 2017-18. The railway no longer hands a slice of its earnings to its owner, and the government pays for new lines directly instead.

How other countries pay for their trains

Railways keep their accounts in different ways, so these comparisons are rough. The direction is still clear.

Amtrak’s record year brought in $2.7 billion of ticket revenue and still produced an adjusted operating loss of $598.4 million. Amtrak says it is on track to cover the cost of running its trains by 2028.

In Britain, the UK and devolved governments put £11.9 billion into the day-to-day running of the railway between April 2024 and March 2025, according to the Office of Rail and Road. That was nearly half the industry’s income. Fares brought in £11.5 billion.

Deutsche Bahn reported a net loss of €2.3 billion from its continuing businesses in 2025, including a €1.4 billion write-down, mostly at its long-distance arm.

Indian Railways, selling tickets at 57 percent of cost, meets its running costs and a pension bill of nearly ₹60,000 crore from what it earns.

A thin line, held

Two cautions belong in the account. The surplus is not automatic: in 2021-22, with passenger traffic still hit by the pandemic, the operating ratio reached 107.39 percent, and the government lent the railway about ₹79,400 crore across 2020-21 to see it through. Repayment starts in the 2026-27 budget. And the national auditor, which counts costs more strictly than the railway does, put the 2022-23 ratio at 101.33 percent rather than 98.10.

Every year since the pandemic, the railway’s own accounts have come in under 100. For a network that sells most of its seats at a loss on purpose, staying on the right side of that line is the achievement. What it cannot yet do is pay for its own growth.

Where the ₹2.5 lakh crore goes

The growth money comes from the Union Budget. Gross budgetary support for railway capital spending was ₹29,055 crore in 2013-14. In 2024-25 it was ₹2,52,324 crore, and the 2026-27 budget sets it at ₹2,78,030 crore, of which ₹79,072 crore is marked for building new track. PRS estimates budget support pays for 95 percent of the railway’s capital spending.

Some of it is easy to see. By April 2025, 98 percent of the tracks had been electrified, and some 54,600 km of track was renewed between 2014 and February 2026. The showpieces, such as the Chenab bridge in Kashmir and the new Pamban bridge, have a tour of their own.

New track also means more room for the trains that keep fares low. In 2025-26 the railway handled 2,91,86,475 wagons of freight, about 12.7 lakh more than the year before. Somewhere in that count is the coal that paid the other ₹43 of your ticket.