Railway Finance

Though a part of the overall financial figures of the Government of India, the Railway Budget was being presented separately to the Parliament since 1924 -25, owing to the Separation Convention of 1924. The Railways had its own 16 demands for grants, which also used to be considered and passed by the Parliament separately. The main reason behind the Separation Convention was to secure stability for civil estimates as the railway finance used to be a sizeable part of the general finances. The Government decided to merge the Railway Budget with the General Budget from the 2017-18. The unified budget will bring the affairs of the railways to centre stage and present a holistic picture of the financial position of the government. This merger would facilitate multi-modal transport planning between highways, railways and waterways. Railways would continue to maintain its distinct entity, as a departmentally run commercial undertaking and retain its functional autonomy, delegation of financial powers etc. as per the existing guidelines. Instead of the erstwhile scheme of sixteen demands for grants, the Ministry of Finance introduced one demand for grant for the Ministry of Railways.