The Future of Indian Railways 2050

Future of Indian Railways 2050

(As published in Business India, August 2016)

Indian Railways will have to transform so significantly by 2050 that not only will it be recognizable from its current operations but also most of its current assets will get replaced completely.

We need to understand the drivers that will make this transformation an imperative.

As per the UNDP Regional Human Development Report, India’s working population (people in the age group of 15 to 64 years) will be over a billion by 2050, which will be the largest workforce in the world. This workforce will be highly mobile. In addition, it is expected that over 70% of the population will be urban by 2050 and would have a higher mobility requirement. Given the load carrying capacity of various transportation options and their impact on the environment, railways would have to shoulder the bulk of this massive transportation requirements.

The second key trend driving railways is technological transformations. Mass transportation will be completely transformed in the next 30 years with technologies such as high speed rails (bullet trains), hyperloops (currently being tested in California and Russia among other places), Internet of Things, solar energy, large scale electrification of the economy and moving away from dependence on oil based technologies etc, driving this transformation.

In addition, railways will face competition from other modes of transportation such as road transportation, riverine transportation, coastal shipping and air transportation. Each of these transport systems will become much more efficient, faster and autonomic, implying that they will be managed by computers and would not require dedicated operators such as drivers, pilots etc. Hence these transportation systems will also become cheaper and in addition, will be significantly less polluting than what they are now.

 What that would imply for Indian railways is that it would have to start adopting newer systems of mass transportation, that would transport people and goods much more efficiently and at speeds that are an order of magnitude higher. Such systems would require complete overhaul of the railways as we see them today, with even the tracks requiring to be changed and perhaps even getting replaced by other locomotion enablers, as in the case of Hyperloops, which would require tubes rather than rails for locomotion. Clearly, railways too will become autonomous, requiring no train drivers, station masters,  manned crossings etc. Such a transformation would require a completely new signaling system and railways infrastructure, including automated gates at road crossings, systems that talk to the surroundings such as to incoming trains, vehicles at crossings and perhaps even airplanes, so that not only do the trains travel faster and safer, but are also able to coordinate with modes of transportation that passengers would need to use or that cargo would need to use. For example, if bulk of the passengers are going from one city to another, primarily to take a long distance flight, then the train would need to be in touch with the airplane company, to ensure that delays, If any, get factored into the dynamic rescheduling.

Indian railways in 2050, would also be a different ecosystems from the current one that is dominated by a single behemoth. Indian railways in 2050, would be corporate dominated ecosystem, with perhaps the current Railways Board transforming into a corporation. It would have all kinds of business models with private players managing their own coaches in a larger train, to running entire trains and owning the linear assets (such as railways tracks or the tubes for hyperloop), to owning railway stations. It would not be unthinkable to have airline companies expanding into railways to provide seamless travel  experience to passengers and cargo.

In addition, Indian Railways in 2050, will not be limited to the borders of India. It would connect with the economies in the east, it would connect with the economies in Central Asia and would perhaps stretch all the way to Europe, in partnership with railways in other countries.

Indian Railways will also start generating significant revenues from non-ticketing sources such as onboard retailing through digital retail, monetization of non-tangible assets, and leveraging technology. It will have a very diversified portfolio of cargo and will not be limited to bulk cargo such as coal (which anyways will have a very limited role by 2050).

Indian railways in 2050 will clearly be unrecognizably different from today’s railways, to be able to shoulder the responsibilities and challenges of the people workforce and cargo of 2050.