Train fares may rise from July 1: Indian Railways plans small hike for AC, non-AC classes

The Ministry of Railways is considering a marginal revision in passenger fares from July 1, 2025, with a proposed hike of one paisa per kilometre for non-AC classes in Mail/Express trains and two paise per kilometre for all AC classes, officials said on Tuesday.

If implemented, it would mark the first fare revision since January 2020.

“As compared to the previous fare revisions in 2020 and 2013, the current increase will be the lowest,” PTI quoted a railway official as saying.

“So far as suburban train and monthly season tickets are concerned, it is being decided not to increase any fare in the interest of the daily commuters,” the official added.

The second-class fare for distances up to 500 km will remain unchanged, while travel beyond that may see a half paisa per km increase.

The last revision in January 2020 had seen a hike of 1 paisa per km for ordinary second class and 2 paise for Mail/Express second class tickets.

Sleeper class fares were raised by 2 paise and AC classes by 4 paise per km at that time.

“Before 2020, it was in 2013 when the train fares for all classes were revised significantly. For instance, while the second class fare for ordinary trains was raised by 2 paise, the second class fare for Express/Mail trains increased by 4 paise. Further, the sleeper class fare also went up by 6 paise,” the official said.

The Railways has projected ₹92,800 crore in revenue from passenger services in FY26, banking on rising passenger traffic. In FY25, over 736 crore passengers travelled by train, generating ₹75,215 crore in revenue.

While freight continues to be the backbone of Indian Railways, contributing around 65% of total earnings, the passenger segment accounts for nearly 30%.

Premium AC classes contribute about 54% of total passenger revenue despite accounting for only 4.8% of passengers. On the other hand, General and Sleeper classes carry about 37% of passengers, while suburban services cater to 57%.

The Standing Committee on Railways, in a December 2024 report, had urged the Railways to align AC fares more closely with operational costs to minimise losses in the passenger segment.

The panel noted that suburban services recover only about 30% of costs, non-AC segments around 39%, and AC services a modest surplus of 3.5%.

“The Committee are aware that Indian Railways are the main means of transport for crores of poor people and they have to incur losses on pricing fares below cost in wake of Social Service obligations," the report said.

“Committee feel that ‘General class’ travel must remain affordable for the masses but at the same time the Committee urge Indian Railways to review its revenues with regard to AC classes by aligning it with costs incurred to reduce losses in passenger segment,” it added.