Railway fare hikes to kick in from July 1: 2 paise per km for AC travel, 1 paise per km for non-AC
It has kept suburban fares and monthly seasonal fares the same.
According to a Ministry circular issued Monday, AC class (first class, 2-tier, 3-tier, and chair car) fares have been increased by two paisa per km. For non-AC classes in mail and express trains (sleeper class, second class (general) and first class), the fare increase is one paisa per km.
Put simply, a passenger travelling 1,000 km in any AC class will have to pay Rs 20 more. For those travelling in a sleeper or general coach of any Mail or Express train, the additional fare will be Rs 10.
For the second class or general class in ordinary trains, there is no fare increase up to 500 km. After that, the fare has been increased by Rs 5 for distances between 501 km to 1,500 km, Rs 10 for distances between 1,501 km and 2,500 km and Rs 15 for distances between 2,501 km to 3,000 km.
The Ministry said the revised fares will not affect those who have already booked tickets for journeys after July 1 on the earlier rates.
'However, any new tickets made by ticket checking staff in trains/at stations on or after 01.07.2025 shall be charged on the revised rate,' said the notification.
Additional charges such as reservation fee and superfast surcharge have been left untouched.
Going by the Railways' projection of passenger kilometres, the hike starting July 1 could generate an additional revenue of over Rs 1,100 crore for the remaining period of the current financial year (2025-26). For the complete financial year, the additional revenue generated would have been over Rs 1,450 crore.
According to the Railways, the total projected revenue from the passenger segment for FY26 is Rs 92,800 crore, on the expectations of an increase in passenger numbers. In FY25, when over 736 crore people travelled by trains, the total passenger revenue was Rs 75,215 crore.
The last revision in passenger fares happened in January 2020, when the Ministry increased the fare of non-AC classes in Mail and Express trains by two paisa per km and of AC classes by four paisa per km. One paisa per kilometre was the increase in ordinary non-AC classes.
The Railways heavily subsidises passenger services. According to a Parliamentary committee report, the suburban services recover around 30 per cent of their costs and non-AC services recover 39 per cent. AC travel generates a marginal surplus of 3.5 per cent.
The Railways generates nearly 65% of its total revenue from transportation of freight. The passenger segment contributes almost 30 per cent. The rest is from sundry sources.
In the passenger segment, 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. But in terms of the number of passengers, AC classes account for only 4.8 per cent of the total, while Sleeper and General Classes together carry almost 37 per cent. Suburban trains account for 57 per cent of passengers.
In December 2024, the Standing Committee on Railways recommended the Indian Railways review the revenue from the AC Classes and align it with the cost incurred to reduce losses in the overall passenger segment.
Dheeraj Mishra is a Principal correspondent with The Indian Express, Business Bureau. He covers India's two key ministries- Ministry of Railways and Ministry of Road Transport & Highways. He frequently uses the Right to Information (RTI) Act for his stories, which have resulted in many impactful reports. ... Read More
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