Vande Bharat trains have significantly altered passenger travel in India, offering a semi-high-speed experience with modern amenities.
With the release of sleeper versions, their appeal is only increasing. The question of who truly owns the Vande Bharat fleet and why the Railways pays for them if it is the rightful owner arises because Indian Railways incurs a significant annual cost for operating these trains.
Indian Railways does, in fact, own the Vande Bharat trains. Under the "Make in India" campaign, they are produced domestically in factories in Chennai and other places throughout the nation. About 500 Vande Bharat coaches have been produced by Indian Railways to date; some of these have also been exported to other countries.
The enormous cost of building these trains—billions of rupees a year—is the reason Indian Railways continues to pay a yearly fare for them even though it is the owner.
Indian Railways borrows money from the market because it lacks the required lump sum funds to cover this expense. The Indian Railway Finance Corporation (IRFC), a business founded by the Railways expressly to address its financial needs, oversees this borrowing procedure.
Indian Railways uses the money it receives from the IRFC to build Vande Bharat and other train coaches, as well as to lay new tracks and complete other construction projects. After funding these projects, the IRFC leases the assets back to the railroads.
Also Read: Fifth Vande Bharat for J&K flagged off, LG thanks PM Modi
Indian Railways reimburses the sum as yearly "rent" in exchange. By using this financial model, the Railways are able to avoid significant upfront expenses and instead use the profits from train operations to gradually repay the IRFC.
Indian Railways spent Rs 30,154 crore in the fiscal year 2023–2024 to pay back the principal and interest on the money it had borrowed. This involved paying more than Rs 17,000 crore in principal and more than Rs 13,000 crore in interest.
Also Read: Now sleeper Vande Bharat to cut Delhi-Patna travel time by half
The Railways had leased assets worth Rs 2.95 lakh crore from the IRFC during this time. The Vande Bharat trains, roughly 13,000 railway engines, and other coaches are some examples of these resources. This significant investment demonstrates the financial plan supporting Indian Railways' modernisation initiatives.
Also Read: J&K CM pitches for more coaches,Wi Fi facility in 'Vande Bharat'
Follow us
