New Delhi: Indian Railways is undertaking a series of cost-control measures across key operational areas as it prepares for a likely rise in salary and pension liabilities linked to the Eighth Central Pay Commission.
The railway network is focusing on trimming expenses related to maintenance, procurement and energy consumption in an effort to strengthen its financial health ahead of the anticipated implementation of revised pay structures. These steps are seen as a pre-emptive move to cushion the impact of higher wage outgo once the commission’s recommendations come into force.
The Eighth Central Pay Commission was constituted in January 2024 to review and propose revisions in pay, allowances and pensions for central government employees. Headed by former Supreme Court judge Ranjana Prakash Desai, the panel is expected to submit its final report within 18 months, while interim reports may be issued as decisions are finalised. The recommendations are likely to be implemented from 1 January 2026.
Once adopted, the changes will affect around 50 lakh serving central government employees, including defence personnel, as well as nearly 69 lakh pensioners.
On the financial front, Indian Railways recorded an operating ratio of 98.90 per cent in the 2024–25 financial year, generating a net surplus of Rs 1,341.31 crore. For 2025-26, the transporter is reportedly aiming to improve its operating ratio to 98.42 per cent, with projected net revenue rising to Rs 3,041.31 crore.
In a positive development, annual repayments to the Indian Railway Finance Corporation are expected to ease from 2027-28, as recent capital expenditure has increasingly been supported through gross budgetary support rather than borrowings.
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