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Transportation is a large and varied sector of the economy. Modes of conveyance for goods range from people's heads (on which loads are balanced) and bicycle rickshaws to trucks and railroad cars. The national railroad was the major freight hauler at independence, but road transport grew rapidly after 1947. Both rail and road transport remain important.

The share of transportation investments in total public investment declined during the period from the early 1950s to the early 1980s; real public transportation investment also declined during much of that period because of the need for funds in the rest of the economy. As a consequence, by the early 1980s the transportation system was barely meeting the needs of the nation or preparing for future economic growth. Many roads, for example, were breaking up because of overuse and lack of maintenance; railroads required new track and rolling stock. Ports needed equipment and facilities, particularly for bulk and container cargo; and at many airports the national civil airlines needed supporting equipment, including provision for instrument landings. The government planned to devote 19 percent of the Eighth Five-Year Plan (1992-96) budget to transportation and communications, up from the 16 percent devoted to the sector during the seventh plan.

Although there is a large private-sector involvement in transportation, government plays a large regulatory and developmental role. The central government has ministries to handle civil aviation, railroads, and surface transportation. Counterpart agencies are found at the state and union territory level. Critical to improving the entire transportation sector in the late 1990s is the ability of the sector to adjust to the central government's national reform initiatives, including privatization, deregulation, and reduced subsidies. The sector must also adjust to foreign trade expansion, demographic pressures and increasing urbanization, technological change and obsolescence, energy availability, and environmental and public safety concerns.


India's railroad system is the government's largest public enterprise (see fig. 12). Its route length extends 62,458 kilometers. The railroads of India are the fourth most heavily used system in the world, which suggests the large investment made in rail transportation. In the mid-1990s, the railroad system employed 1.7 million people and carried around 66 percent of India's goods traffic (some 350 million tons in FY 1992) and 40 percent of passenger traffic (3.7 billion passenger journeys in FY 1992).

Indian Railways is administered and managed by the Railway Board, which is subordinate to the Ministry of Railways. The minister of railways is assisted by the minister of state for railways. Indian Railways is Asia's largest railroad system and the second largest state-owned system under a single management in the world. The 62,458 kilometers of route-length track run in three gauges: narrow gauge (610 and 762 millimeters), meter gauge (1,000 millimeters), and broad gauge (1,676 millimeters). Around 17 percent, or about 11,000 kilometers, of all gauges is electrified, and about 27 percent, or 10,859 kilometers, of the broad-gauge track is electrified. Some 14,600 kilometers are double or multiple tracked. As of FY 1991, there were some 116,000 railroad bridges and some 7,100 railroad stations.

The railroad system is divided into nine zones: central, eastern, northern, northeastern, northeast frontier, southern, south-central, southeastern, and western. As of FY 1993, Indian Railways had 1,725 steam, 4,069 diesel, and 2,012 electric locomotives; 3,444 electric multiple-unit coaches; 30,298 conventional passenger coaches; 6,163 other passenger cars (including luggage and mail cars in which passengers sometimes travel); and 337,562 freight cars of all kinds.

The Eighth Five-Year Plan provided for a Rs45 trillion investment in railroad development. Priority was to be given to track and roadbed renovation, additional electrification, conversion of high-use meter-gauge lines to broad-gauge track, the replacement of all steam locomotives, and improved signalling and telecommunications. By 1992, however, the funds actually approved by the government were only 80 percent of the eighth plan's amount, and only 42 percent would be covered by the central government budget. Indian Railways was expected to come up with the balance. Thus, in FY 1994, the outlay was set at Rs65.1 billion; Rs11.5 billion was to come from central government revenues, Rs43.1 billion from internal railroad resources, and Rs10.5 billion from loans. Some of the investment funds, as in the past, were expected from the World Bank. The only way to cover these outlays with such low budgetary support was with drastic increases in fares and rates in passenger service. In FY 1993, Indian Railways made capital expenditures amounting to US$2 billion for items such as new rolling stock, new line construction, track renewal, and electrification.

An example of the scale of new rail line construction is the new broad-gauge high-speed Konkan Railway, a 760-kilometer coastal connection between Bombay and Mangalore featuring fifty-five stations, seventy-three tunnels, 143 major bridges, and some 1,670 minor bridges. The line crosses several mountain ranges and runs some 380 kilometers through an earthquake-prone zone. Besides opening up an all-weather transportation infrastructure between two important cities, it cuts the distance by rail between them by 1,127 circuitous kilometers.

India has a major railroad-equipment production industry. Although some state-of-the-art electrical components and equipment are imported, India is developing sufficient industrial capacity to meet most of its standard locomotive and passenger-car and ancillary equipment needs and has made plans to export locomotives. The Research, Design, and Standards Organisation of Indian Railways engages in research and simulations aimed at further improving the quality of domestic achievements, which have included high-speed passenger trains (up to 140 kilometers per hour) and freight trains (up to 80 kilometers per hour) and solid-state signalling equipment. Because some two-thirds of the nation's freight is carried by train, there is a serious freight car shortage. To overcome this and other industry-related rail transportation problems, Indian Railways envisions having to import up to 5,000 freight cars a year.

Data as of September 1995

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