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RISING INDIA

How Indian Railways Became the World’s Second Largest Rail Freight Carrier

Desi Metros Staff
October 20, 2025 4 Mins Read

Indian Railways has become the world’s second largest rail freight carrier, behind only China, according to official data from the Ministry of Railways and the International Energy Agency (IEA). The network now carries over 1.6 billion tonnes of freight annually and contributes nearly 30 per cent of India’s total freight traffic.

The growth has been driven by infrastructure expansion, digital reforms, and a renewed focus on freight efficiency under the government’s National Rail Plan and PM Gati Shakti initiative.

Freight Volumes and Growth Trend

Indian Railways handled 1,591 million tonnes (MT) of freight in 2022–23, up from 1,418 MT in 2021–22, according to data from the Railways’ Annual Statistical Statements.

By the end of 2024–25, it is expected to exceed 1,700 MT, with the long-term goal of crossing 3,000 MT by 2030 under the National Rail Plan.

The share of freight revenue has also increased, touching Rs 1.62 trillion in FY2023–24, up from Rs 1.47 trillion in the previous year, according to Indian Railways financial statements.

Freight Handled by Indian Railways (in million tonnes)

Financial Year Freight Handled (MT)
2013–14 1,055
2017–18 1,160
2021–22 1,418
2022–23 1,591
2023–24 1,617
2024–25* 1,700 (estimated)

Source: Ministry of Railways Annual Reports, PIB 2024.

Global Comparison

According to the International Energy Agency (IEA) Rail Transport Statistics 2023, India now ranks second globally in rail freight movement, with around 750 billion tonne-kilometres (BTKM) handled annually.

China leads the list with 3,500 BTKM, while the United States follows with around 2,500 BTKM.

India’s share has steadily risen due to increased coal, cement, steel, and container traffic.

Global Rail Freight (2023)

Country Freight (Billion Tonne-km)
China 3,500
USA 2,500
India 750
Russia 500

Source: International Energy Agency, World Bank Rail Logistics Data 2023.

 

Infrastructure Expansion

A major factor behind India’s freight growth is the construction of Dedicated Freight Corridors (DFCs) — the Eastern DFC (1,337 km) and Western DFC (1,506 km).

Together, these corridors are expected to handle over 70 per cent of freight traffic between the major ports, mines, and industrial zones.

According to the Dedicated Freight Corridor Corporation of India Ltd (DFCCIL), the DFCs have increased average freight train speeds from 25 km per hour to 70 km per hour, significantly reducing turnaround time and fuel consumption.

In addition, Indian Railways is developing three new corridors under the PM Gati Shakti plan — the East-West (2,328 km), North-South (2,327 km), and East-Coast (1,114 km) corridors — to further boost freight capacity.

Digital Reforms and Ease of Doing Business

The Freight Operations Information System (FOIS) and Electronic Demand Registration (e-DRS) have streamlined cargo booking and monitoring.

The Rail Madad and Rail Sugam portals have been integrated to improve customer interface for freight clients.

As per PIB data (2024), over 95 per cent of freight bookings are now done digitally.

Indian Railways has also introduced the Integrated Coach Management System (ICMS) and AI-based predictive maintenance to improve turnaround efficiency.

Private Sector Participation

The Railways has opened the door to Private Freight Terminals (PFTs) and Gati Shakti Multi-Modal Cargo Terminals (GCTs).
By mid-2024, more than 86 GCTs had been commissioned across the country, with a target of 500 by 2030, according to the Ministry of Railways.

Private investment in wagons, terminals, and rolling stock has increased under the Railways Public-Private Partnership (PPP) model, allowing industries such as cement, steel, and ports to build and operate terminals.

Environmental and Economic Impact

According to the IEA Transport Outlook, rail freight emits six times less carbon dioxide per tonne-kilometre compared to road transport.
The shift to rail is expected to reduce India’s annual carbon emissions by nearly 10 million tonnes by 2030, supporting its net-zero ambitions.

From an economic perspective, rail freight is also cost-efficient.

According to the NITI Aayog Logistics Cost Report, the average cost per tonne-kilometre for rail is Rs 1.36, compared to Rs 2.50 for road.

Future Outlook

The National Rail Plan 2030 aims to increase rail’s share in India’s total freight traffic from 27 per cent to 45 per cent by 2030.
This will be supported by completion of the new corridors, station modernisation, and advanced rolling stock.

The government also plans to add 40,000 new wagons and 1,000 locomotives over the next five years.

In addition, the Amrit Bharat Station Scheme and PM Gati Shakti programme are designed to improve connectivity between ports, industrial parks, and inland depots.

Freight Projection Scenarios (2024–2030)

Year Conservative (4% CAGR) Accelerated (6% CAGR) Target (to reach 3,000 MT)
2024–25 1,617 1,617 1,617
2025–26 1,682 1,717 2,078
2026–27 1,748 1,820 3,000
2027–28 1,818 1,931 —
2028–29 1,891 2,049 —
2029–30 1,967 2,172 —

Source: Ministry of Railways, National Rail Plan 2030.

From outdated infrastructure to a globally competitive logistics network, Indian Railways has transformed into the world’s second largest rail freight system.

With dedicated corridors, digitisation, and private participation, it is now a central pillar of India’s logistics and industrial growth strategy.

If current targets are achieved, Indian Railways could move three billion tonnes of freight annually by 2030, strengthening its role as the backbone of India’s transport economy.

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