The Indian Railways is a departmental commercial undertaking of the Union Government of India. From 1 April 1950, a separate Railway Budget is being presented to the Parliament prior to presentation of the General Budget every year. Though the Railway Budget is presented to the Parliament separately, the figures relating to the receipts and expenditure of the Railways are also shown in the General Budget, as Railway Budget forms part of the total budget of the Government of India.
The Railway Minister, while presenting budget estimates for the next financial year, gives an overview of the performance of the Indian Railways during the previous year. Priority areas for the Ministry in the coming year are stressed. Issues relating to new lines, creation of rail infrastructure, investment in rolling stock, safety and security issues, staff welfare and changes in tariffs of passenger and freight trains are discussed. Along with the Railway budget, an outcome and performance budget for the previous year is presented to the Parliament where details on financial outlays as well as physical outcomes are given.
The presentation of the Railway Budget is a continuation of the legacy left behind by the British Empire, where Railway finances were separated from General finances. Railway Budget is an instrument of Parliamentary Financial Control and at the same time, an important management tool.