Finance Minister Nirmala Sitharaman will present the Union Budget 2021 for the third time in the Parliament on February 1. Like other sectors, railways also suffered huge financial losses as full-scale services have not been operationalised even 10 months after Covid-19 pandemic hit India.
Though there's no separate budget for railways any more, the government may have some major announcements for the strategically important sector. The railways had played a crucial role in ferrying migrant workers from major cities to their native areas after the first lockdown in India in March 2020. However, the services remained shut for several months, before resuming services partially in May.
The railways are considered to be the crucial driver of India's economy. And, giving a boost to it amid the pandemic becomes even more crucial. There are expectations that the Centre may announce a few Tejas trains, a dedicated railway line to move agri goods and some infrastructural upgradation of railways.
The FM could announce the total allocation of around Rs 1.79 lakh crore for railways, of which Rs 75,000 crore will be gross budgetary support (GBS). The allocation will be about Rs 18,000 crore more than Rs 1.61 lakh crore announced last year.
The Centre may focus more on launching high-speed private trains this time. These trains could connect major tourist hubs, pilgrimage spots, and other strategically important areas.
The FM could also announce the Centre's plans on bullet train network expansion in the country. Last year, the FM had announced that the government would actively pursue the bullet train project between Mumbai and Ahmedabad. However, the Covid-19 pandemic derailed the plan and progress has been slower.
Experts say the Centre may also come up with special allocation for 'green railways' projects to give a boost to railways' plan to turn fully green by 2030. The Centre may also enhance the allocation for the railways' 'safety fund', which is aimed to prevent accidents and boost safety.
Meanwhile, the railway ministry has also demanded gross budgetary support (GBS) of about Rs 75,000 crore from the Ministry of Finance in the upcoming budget. The GBS sought by the railway ministry is about 7 per cent higher than GBS of Rs 70,250 crore allocated for the financial year 2020-21 in last year's budget by Sitharaman. It may be noted that the GBS was at Rs 69,967 crore in 2019-20 and Rs 55,088 crore in 2018-19.