History of Indian Railways

A plan for a rail system in India was first put forward in 1832, but no further steps were taken for more than a decade. In 1844, the Governor-General of India Lord Hardinge allowed private entrepreneurs to set up a rail system in India. Two new railway companies were created and the East India Company was asked to assist them. Interest from investors in the UK led to the rapid creation of a rail system over the next few years. The first train in India became operational on 22 December 1851, and was used for the hauling of construction material in Roorkee. A year and a half later, on 16 April 1853, the first passenger train service was inaugurated between Bori Bunder, Bombay and Thane. Covering a distance of 34 km (21 miles), it was hauled by three locomotives, Sahib, Sindh and Sultan. This was the formal birth of railways in India.
A view of the Burdwan Railway Station in 1855
A view of the Burdwan Railway Station in 1855

The British government encouraged new railway companies backed by private investors under a scheme that would guarantee an annual return of five percent during the initial years of operation. Once established, the company would be transferred to the government, with the original company retaining operational control. By 1875, about £95 million were invested by British companies in Indian guaranteed railways. The route mileage of this network was about 14,500 km (9,000 miles) by 1880, mostly radiating inward from the three major port cities of Bombay (Mumbai), Madras (Chennai) and Calcutta ( Kolkata). By 1895, India had started building its own locomotives, and in 1896 sent engineers and locomotives to help build the Uganda Railway. Soon various independent kingdoms built their own rail systems and the network spread to the regions that became the modern-day states of Assam, Rajasthan and Andhra Pradesh. A Railway Board was constituted in 1901, but decision-making power was retained by the Viceroy, Lord Curzon. The Railway Board operated under aegis of the Department of Commerce and Industry and had three members: a government railway official serving as chairman, a railway manager from England and an agent of one of the company railways. For the first time in its history, the Railways began to make a tidy profit. In 1907, almost all the rail companies were taken over by the government.

The following year, the first electric locomotive appeared. With the arrival of the First World War, the railways were used to meet the needs of the British outside India. By the end of the First World War, the railways had suffered immensely and were in a poor state. The government took over the management of the Railways and removed the link between the financing of the Railways and other governmental revenues in 1920, a practice that continues to date with a separate railway budget.

The Second World War severely crippled the railways as rolling stock was diverted to the Middle East, and the railway workshops were converted into munitions workshops. At the time of independence in 1947, about 40 per cent of the railways then went to the newly independent republic of Pakistan. A total of forty-two separate railway systems, including thirty-two lines owned by the former Indian princely states, were amalgamated as a single unit which was christened as the Indian Railways.

The existing rail networks were abandoned in favour of zones in 1951 and a total of six zones came into being in 1952. As the economy of India improved, almost all railway production units were indigenised. By 1985, steam locomotives were phased out in favour of diesel and electric locomotives. The entire railway reservation system was streamlined with computerisation in 1995.

Indian Railways is one of the largest employers in the world. Very few corporate entities, public or private, have a larger workforce.