Cash cow on tracks: Inside the lucrative economics driving India’s Vande Bharat expansion

Operational metrics across passenger categories show widespread losses in 2024-25, with AC 3-tier and AC Chair Car standing as the sole exceptions. Losses ranged from a steep Rs 20,705.94 crore in Ordinary class to Rs 48.77 crore in First Class during FY25.

In contrast, AC 3-tier generated Rs 3,645.44 crore in profits in FY25, up from Rs 2,501.07 crore in FY24 and Rs 3,300.08 crore in FY23. AC Chair Car recorded a Rs 376.77 crore profit in FY25, successfully rebounding from losses of Rs 203.96 crore in FY24 and Rs 297.62 crore in FY23.

Chair car services feature predominantly in premium trains like Vande Bharat, Shatabdi, and select intercity routes. While Shatabdi trains adopted dynamic fare pricing in 2018, Vande Bharat fares sit at a premium above Shatabdi rates.

Soaring demand for premium rail travel

Sustained profitability driven by strong passenger appetite has accelerated Vande Bharat deployments nationwide.

Patronage across the Vande Bharat network surged in FY26, carrying approximately 3.98 crore passengers. This reflects a robust 34% year-on-year growth compared to 2.97 crore passengers in FY25.

Since launching in 2019, the Vande Bharat Express network has served over 9.1 crore passengers across 1 lakh completed trips through March 2026. The New Delhi-Varanasi corridor remains the busiest route, accounting for over 73 lakh passengers to date.

To strengthen long-distance connectivity, Indian Railways launched the Vande Bharat Sleeper service in January 2026. Within its first three months of operation, the service carried 1.21 lakh passengers over 119 trips while maintaining an occupancy rate exceeding 100% — underlining strong consumer demand and growing confidence in premium overnight rail travel.