History of Indian Railway Budget – Reminiscences!

India’s first Finance Minister, Sir R.K. Shanmugham Chetty, presented the first Finance Budget of independent India on November 26, 1947. It was a review of the economy and no new taxes were proposed as the budget day for 1948-49 was just 95 days away.

K.C. Neogy then took charge of the Finance portfolio and held that office for just 35 days.

John Mathai became the third Finance Minister of India presenting the budget for 1950-51, the first budget for the Republic of India.

The next Finance Minister, C.D. Deshmukh presented the first budget in the first elected Parliament on the basis of adult franchise.

Budget papers began to be prepared in Hindi from 1955-56. Initially, major attention was paid towards the agriculture sector but as the economy evolved, the focus shifted from agriculture to other sectors like industry and finance.

In 1959, Morarji Desai became the Finance Minister. After the fourth General Elections in 1967, Morarji Desai once again became the Finance Minister. This was his second time. He has presented ten budgets till date. They included five annual and one interim budget during his first stint and three final and one interim in the second tenure when he was both Finance Minister and Deputy Prime Minister.

After Desai resigned, Indira Gandhi, the then Prime Minister, took over the Finance portfolio.

The shortest ever interim budget speech was just 800 words and delivered by H. M. Patel in 1977.

Rajiv Gandhi presented the budget for 1987-88 after V P Singh quit his government, and in the process became only the third Prime Minister to present a budget after his mother and grandfather.

Yashwant Sinha became the Finance Minister and presented the interim budget for 1991-92.

In the election held in May 1991, the Congress returned to power and Shri Manmohan Singh became the Finance Minister. This was the first occasion when the interim and final budgets were presented by two ministers of two different political parties.

After the elections another non-Congress ministry assumed office.

So, a final budget for 1996-97 was presented by Shri P. Chidambaram of the then Tamil Maanila Congress. It was the second time that an interim and final budget was presented by two ministers of different political parties.

Following a constitutional crisis, the I.K. Gujral Ministry was on its way out, and a special session of Parliament was convened only to pass Shri Chidambaram’s 1997-98 budget.

In 2000, Mamata Banerjee became the first women Railway Minister of India. In the year 2002, she also became the first female Minister of Railways to present the Railway budget. She holds the record of being the only women who presented the railway budget for two different governments in the centre (NDA and UPA).

First live telecast of railway budget took place on 24 March 1994. Lalu Prasad Yadav, who remained Railways Minister from 2004 to May 2009, presented the railway budget six times in a row.

Some finer points of Railway Budget 2025:–

In 2014 railway budget, Railway Minister D. V. Sadananda Gowda announced the first railway budget, under the Modi regime.
Making some startling revelations on how the Indian railways was run over the past ten years, Gowda said, “”Madam Speaker, I am sure, my esteemed predecessors were aware of this precarious situation, but they, however, fell prey to the ‘nasha’ of claps in the House when they announced these projects.”
There was ruckus in parliament over non-allocation of more new trains.
Opposition roared when the Minister announced the Mumbai-Ahmedabad bullet train.
The minister used the word “safety” was used a dozen of times.
Gowda also mentioned Mahatma Gandhi and Swami Vivekananda in his speech once each.
Gowda mentioned Prime Minister Narendra Modi’s name four times, and former prime minister, Atal Behari Vajpayee was mentioned once.
Opposition interrupted the minister a dozen of times during the budget speech.
Sensex hit new highs of 26,190.44 ahead of Railway Budget but crashed by over 550 points post the presentation.
Gowda read quotes four times during his speech, twice in Sanskrit, once in English and once in Kannada. He ended the Railway Budget with quote in Kannada.
‘Hey Prabhu‘: Railway Minister puns on his Name, amuses Indian Parliament. Railway Minister Suresh Prabhu on 26th February, 2025 amused parliamentarians by liberally punning on his own name during his speech. “Our priority is to improve the capacity in the high density section. But I thought, hey Prabhu (oh God), how will it happen,” he said, drawing laughs in the Lok Sabha. “Prabhu (God) didn’t answer, so this Prabhu thought, why can’t we do something?”
Eventually, Suresh Prabhakar Prabhu himself became the last Minister of Railways to present a 92 year old tradition of presenting Railway Budget in the Parliament of India, which was subsequently been passed on to the Ministry of Finance.
On 1st February, 2025, Union Minister of Finance Mr.Arun Jaitley presented the Railway Budget as a part of the Budget 2023.

Here’s a detailed and reflective remembrance of the Indian Railway Budget’s history, capturing its evolution, significance, and legacy over the decades:

🇮🇳 History of the Indian Railway Budget – Reminiscences

🚂 A Unique Tradition (1924–2025)

For 92 years, the Indian Railway Budget stood as a distinct and prestigious financial exercise—the only sector in India with a separate annual budget presentation, and a legacy that began under British rule.

In 1920, the Acworth Committee, headed by British economist William Acworth, recommended separating the finances of Indian Railways from the General Budget for greater transparency.
This led to the first separate Railway Budget in 1924 under British India.

📅 Key Milestones in the Journey

Year	Event
1924	First separate Railway Budget introduced during British rule.
1947	First Railway Budget of Independent India by John Matthai, who also presented the General Budget.
1960s–80s	Rail Budgets became known for announcing new trains and railway zones, often with political motivations.
1994	First live telecast of the Railway Budget in India.
2004–09	Lalu Prasad Yadav’s tenure praised for turning Railways profitable without raising passenger fares.
2000s–2010s	Mamata Banerjee, Nitish Kumar, and Suresh Prabhu played prominent roles as Railway Ministers.
2025	Last standalone Railway Budget presented on February 25, 2025 by Suresh Prabhu.
2025	Merger of Railway Budget with Union Budget—marking the end of a 92-year tradition.

🧾 Why Was There a Separate Railway Budget?

Massive operations: Indian Railways, one of the world’s largest employers and transport networks, warranted special focus.
Financial scale: Railways constituted a significant portion of government expenditure and revenue.
Strategic asset: Being vital for defense, economy, and national integration, it demanded separate policymaking.
Colonial legacy: The system was inherited from British administrative practice.

📉 Criticism Over Time

The Railway Budget became increasingly populist: new train announcements for electoral gains overshadowed safety and modernization.
Often used as a political tool, it became more about regional appeasement than national infrastructure strategy.
Multiple NITI Aayog and Planning Commission reviews questioned the relevance of continuing a separate budget.

🔀 Merger with the Union Budget (2025)

In September 2025, the Cabinet approved the historic merger.
From February 1, 2025, the Union Budget subsumed railway finances.
Key benefits of the merger:
- No more annual dividend from Railways to the government (~₹10,000 crore saved).
- Streamlined planning: Integrated transport infrastructure (railways, roads, waterways).
- Early implementation of projects from April 1 each year.

🌟 Reminiscences and Legacy

A spectacle of governance: The Railway Budget was a media event, watched by millions for fare changes and new trains.
Symbol of inclusivity: It highlighted how even remote regions hoped for inclusion in national connectivity.
A lesson in reform: The merger symbolized India’s shift from symbolic governance to strategic planning.

🧠 Did You Know?

Indian Railways had the world’s fourth-largest rail network under a single management.
Railway Ministers often rose to national prominence (e.g., Lalu Prasad Yadav, Mamata Banerjee).
The only sector in India with its own dedicated annual financial statement for almost a century.

📘 Conclusion

The Indian Railway Budget was more than a financial document—it was a national ritual, symbolizing India’s connection, ambition, and politics on rails.

Though now part of the Union Budget, its legacy endures in every new track laid, train flagged off, and policy shaped. As India pushes toward semi-high-speed rail, green energy, and privatization, the echoes of the Railway Budget remind us of a time when trains not only connected places but also defined political discourse.

Would you like a visual timeline, archived Railway Budgets, or famous speeches by past Railway Ministers like Lalu Prasad or Mamata Banerjee?