Indian Railways Plans Six New Freight Lines with Private Sector Participation

Indian Railways is preparing to build six new freight railway lines in partnership with private companies, marking a major shift in the way railway infrastructure projects could be financed and developed in India.

The six proposed freight lines will cover a combined distance of around 647 kilometres and are expected to be developed under the Hybrid Annuity Model (HAM), a public-private partnership model already used in parts of India's highway infrastructure sector.

Under the proposed model, Indian Railways will provide 40% of the project cost during the construction period, while private partners will finance the remaining 60%. After the railway lines become operational, the Railways will repay the remaining amount through annuity payments along with interest.

The proposed projects include four railway lines in Odisha, along with one project in Telangana and another in Jharkhand. These freight corridors are expected to improve the movement of important commodities, including coal, iron ore, bauxite, coke, fertiliser, cement and food grains.

The total bid project cost for the six proposed lines is estimated at around ₹15,976 crore. The projects are expected to have a concession period of approximately 17 to 19 years, with the overall capital cost during that period estimated at around ₹40,866 crore.

The proposal has received approval from the Public Private Partnership Appraisal Committee under the Ministry of Finance and will now be sent to the Union Cabinet for final approval before the bidding process begins.

Construction is currently proposed to start from April 2028. According to the reported plan, the government will retain responsibility for operating trains and collecting freight revenue, while also carrying traffic and tariff risks.

The move is significant because it represents Indian Railways' first attempt to develop railway infrastructure through the Hybrid Annuity Model. If successfully implemented, the project could open the door for greater private sector participation in India's railway network and help strengthen freight connectivity across major industrial and mining regions.