Railways to rationalise 29,608 posts in FY27 despite record capex push

Railways plans to rationalise nearly 30,000 posts in FY27 as part of workforce optimisation, even as it receives record capital allocation for modernisation and expansion

Substantial rise in the capital expenditure this fiscal notwithstanding, Indian Railways has initiated a fresh manpower restructuring exercise across its vast network, setting a target to rationalise 29,608 posts during the financial year 2026-27.

 

According to a recent Railway Board communication (reviewed by Business Standard) to General Managers of all zonal railways, production units and other establishments, the manpower rationalisation target for 2026-27 has been fixed at 2 per cent of the total sanctioned strength of 14,80,455 posts as on April 1.

 

"The annual Memorandum of Understanding (MoU) targets for manpower rationalisation have been finalised as part of key performance indicators linked to annual performance agreements for the year. The target includes redistribution of posts as well as surrender of surplus positions. All changes will have to be processed through the Human Resource Management System (HRMS) portal," stated the April 24 letter to the zonal railways.

   

The rail ministry clarified on the development saying manpower rationalisation is a routine exercise mainly involving a redistribution of posts that have become redundant over time and transferring them to critical operational and safety categories.

 

"The objective is to ensure better utilisation of manpower and improved efficiency. For 2025-26, there have, in fact, been several thousand posts created in safety categories and not a net reduction in sanctioned strength," the ministry said. 

In his letter, Director (manpower planning) of the Railway Board Amit Singh Mehra has also directed all zones and units to achieve the targets proportionately on a quarterly basis and avoid their accumulation to the end of the financial year.

 

Among the zones, Northern Railway has been assigned the highest target of 3,303 posts against a sanctioned strength of 1,65,150. Eastern Railway follows with 2,544 posts from 1,27,209 sanctioned positions, while Central Railway has been given a target of 2,492 posts from 1,24,624 posts. Western Railway has been assigned 2,339 posts, East Central Railway 1,922, South Eastern Railway 1,967, South Central Railway 1,908, and Southern Railway 1,906.

 

East Coast Railway has been asked to rationalise 1,239 posts against a sanctioned strength of 61,956. Other zones include North Eastern Railway with 1,194 posts, North Frontier Railway 1,446, North Western Railway 1,255, South East Central Railway 1,184, South Western Railway 893, and West Central Railway 1,311.

 

Production units and specialised establishments have also been included in the exercise. Integral Coach Factory has been given a target of 217 posts out of 10,862, followed by Chittaranjan Locomotive Works (214), Rail Coach Factory (147), Banaras Locomotive Works (115), Patiala Locomotive Works (69), Rail Wheel Factory (50), Rail Wheel Plant (20), and Research Designs and Standards Organisation (50).

 

Railway employees' unions, however, have expressed apprehension over the manpower rationalisation drives, arguing that many departments are already facing shortages, especially in maintenance and safety categories. Some associations feared that surrendering regular posts may eventually lead to greater outsourcing and contractual employment.

 

Ramesh Sahoo, general secretary of ECoR Railway Shramik Congress, alleged that such exercises disproportionately affect lower-rung employees. “Restructuring of posts helps higher level posts and the percentage of posts gets added to the category is done at the cost of matching surrender of lower level posts. We want the restructuring without matching surrender of lower level posts. In rationalisation of posts, the lower level posts are always at the receiving end as they get abolished. This is one type of curtailment of posts which we have been opposing vehemently,” he told Business Standard.

 

Other railway employees' bodies also suspect the move is linked to the Centre’s broader policy of increasing outsourcing in railway services. P K Patsahani, general secretary of Railway Shramik Union, contended that permanent posts in non-core categories are being abolished and contractual workers and private agencies are increasingly being used in areas such as maintenance, cleaning, catering, parcel handling, and some technical support services. "We have been opposing this move," he said.

 

Although manpower restructuring is done at regular intervals, the latest order comes at a time when Railways is rapidly modernising operations through automation, digital systems, mechanised maintenance, and infrastructure expansion, prompting management to reassess traditional staffing patterns.

 

Railway officials clarified that the move should not be seen as a large-scale reduction in jobs, claiming that manpower rationalisation is an administrative exercise aimed at improving efficiency and matching staff strength with operational requirements. They said the rationalisation would involve two methods — redistribution of posts from areas with excess manpower to locations facing shortages and surrendering posts considered surplus or no longer required.

 

“All the posts targeted for rationalisation are not being surrendered, they are also being redistributed. Zones have been advised to redistribute posts from one category to another as per requirement and efficiency. Every year Indian Railways is adding more than 15,000 manpower. Last year, only around 700 posts were surrendered, but around 16,000 posts were created,” a senior railway official told Business Standard, indicating that the exercise is more about workforce optimisation than downsizing.

 

The move comes even as the Union Budget 2026-27 earmarked the highest-ever allocation of Rs 2,93,030 crore for Railways, up by 10.5 per cent over the previous year's capex, for accelerating infrastructure modernisation, new high-speed rail corridors, dedicated freight corridors, safety upgrades, and network expansion.