In 6 months, Railways hikes passenger fares again across classes; suburban ticket rates unchanged

For instance, if a passenger travels from New Delhi to Prayagraj, covering almost 650 km, AC-class and sleeper-class ticket fares will increase by Rs 13.

A senior ministry official said the Railways would earn about Rs 600 crore from this fare revision. This will be additional revenue for the remaining months of the 2025-206 financial year. “The Railways has expanded its network and operations significantly over the last decade. To cater to this high-level network, manpower is being increased. Further, to meet the cost of manpower, the Railways is focusing on high cargo loading and fare rationalisation,” said the official.

Fare revisions in the recent past
The last revision in passenger fare took place in July this year, when the fares were increased by two paisa per km for AC classes, one paisa per km for non-AC (mail/express), and half a paisa per km for second class for distances more than 500 km.

The revision in July happened almost five years after the previous increase in train ticket fares.

In January 2020, the Railways increased the fare of the non-AC class (mail/express) by two paisa per km and AC classes by four paisa per km. There was no increase in the suburban fares for up to 80 km and no increase in season ticket prices either. The fares of the suburban section were revised in May 2022, wherein the single-journey basic fare of AC EMU was reduced by 50 per cent, and the single-journey basic fare for the first class was reduced by around 41 to 49 per cent.

For the Railways, nearly 65 per cent of the revenue comes from freight. In the passenger segment, which contributes almost 30 per cent of the total revenue, premium AC classes such as AC first class, AC 2 tier, AC 3 tier, and AC chair car contribute almost 54 per cent of total passenger revenues. However, the share of AC passengers is only 4.80 per cent of the overall passengers, with sleeper and general classes together accounting for almost 37 per cent of the total passengers. A whopping 57 per cent of all passengers travel in the suburban trains.

Parliamentary panel’s recommendation
In December 2024, the parliamentary standing committee on the Railways recommended that the Railways should review its revenue with regard to AC classes by aligning it with the cost.

“The Committee feel that to increase net revenues of Indian Railways, it is of prime importance to increase its earnings from the passenger segment. The Committee are aware that Indian Railways are the main means of transport for crores of poor people in the country and they have to incur losses on pricing fares below cost in wake of Social Service obligations. Committee feel that ‘General class’ travel must remain affordable for the masses, but at the same time the Committee urge Indian Railways to review its revenues with regard to AC classes by aligning it with costs incurred to reduce losses in passenger segment,” said the committee.

The Railways says it has been heavily subsidising the passenger services. According to the parliamentary committee report, the suburban services recover around 30 per cent of costs, non-AC travel recovers 39 per cent of the cost, and AC travel generates only a marginal surplus of 3.5 per cent.