Privatization of Indian Railways–a Study

Abstract

There is a wide resource gap in the transport sector of India. The Government of India identified the importance of the private sector in bonding this resource gap. The government wants to develop infrastructure and services in transport sector. So, the Government of India is actively working on privatization of Indian Railways. In comparison to roadways, Indian Railways is twelve times more energy efficient in freight traffic. It is also three times more efficient in passenger traffic than roadways. It is much more environment friendly compared to roadways. Railways are considered as the lifeline of our country. It has the potential to contribute around 3% of India’s Gross Domestic Product (GDP). At present, Indian Railways is the fourth largest railway in the world. The major source of income of the Government of India is railways. So, privatization is not much ideal for railways. It increases the price of passenger tickets and freight charges. It would be difficult for the public which is economically poor and those who are completely relied on this sector. Through this study, we will be able to understand the public thoughts and views about privatization of Indian Railways. We will also be able to know whether privatization of Indian Railway is necessary. The objective of this study is to point out the need for privatization of Indian Railways and to discuss the negative implications of privatization.