By Ijaz Kakakhel

Pakistan Railways has framed a balanced budget of Rs210.093 billion for FY2026-27, focusing on boosting internally generated revenue, increasing passenger and freight earnings, expanding commercial activities and maintaining operational spending to improve performance and ensure uninterrupted services.

According to the FY2026-27 budget estimates available with Wealth Pakistan, total revenue receipts have been estimated at Rs210.093 billion, matching the proposed expenditure of the same amount. The financial plan is designed to sustain railway operations, meet employee-related obligations and support infrastructure development.

Pakistan Railways has set its railway earnings target at Rs120 billion, with traffic operations expected to remain the main source of internally generated revenue.

Railway traffic earnings are projected at Rs101 billion, including Rs55 billion from passenger traffic and Rs42 billion from freight traffic. Another Rs4 billion is expected from other coaching traffic.

The revenue plan also places greater emphasis on extracting value from railway assets and commercial operations. Railway sundry earnings have been estimated at Rs19 billion, providing an important supplementary income stream alongside passenger and freight operations.

Of the sundry earnings, property and land are expected to generate Rs14 billion. This includes Rs9 billion from railway divisions, Rs2.5 billion from REDAMCO and another Rs2.5 billion from headquarters.

A further Rs5 billion is projected from sources other than property and land, including Rs2.4 billion from the sale of scrap, Rs2.2 billion from commercial department activities and Rs400 million from other sources.

Together, traffic and sundry earnings take total railway earnings to Rs120 billion.

The budget also provides for Rs5.517 billion in other revenue under Public Service Obligation, taking total revenue before federal grants to Rs125.517 billion.

Federal government grant-in-aid has been estimated at Rs84.576 billion. Of this, Rs70 billion has already been approved for FY2026-27, while an additional Rs14.576 billion will be required.

The additional requirement comprises Rs3.991 billion for the pay increase announced by the federal government, Rs5.585 billion for increased retirement benefits and Rs5 billion for the Prime Minister’s Package.

On the expenditure side, Pakistan Railways has proposed spending of Rs210.093 billion to keep the overall budget balanced.

The expenditure plan prioritises employee-related expenses and retirement benefits, followed by fuel costs, repair and maintenance, utilities and other operational requirements.

Funds have also been provided for the Prime Minister’s Assistance Package, improvement fund, debt servicing, loans and advances, and contributions to designated funds.

The budget framework indicates that Pakistan Railways is seeking to strengthen its financial and operational position by combining passenger and freight earnings with better utilisation of property, commercial activities and other non-traffic revenue sources, while maintaining funding for essential operations and service delivery.

Credit: INP-WealthPk