Railways is in a financial mess. Will Railways be able to stand up on its own?

According to this article, Railways has received good returns from borrowed funds thus far. Encouraging... but all pending projects must be completed ASAP to get the true picture.

Alarm and Optimism
FY 16-17 Q1 saw a 10.3% fall in freight revenue and flat passenger and freight volumes (see link 1). Gross traffic receipts were 17% below budget and cost had not reduced, yet experts are optimistic for CY numbers. Statistics FY to 10.8.16 (see link 2): Not looking good. Continues the trend.

Choked under its own weight
Slow speeds are making train travel unattractive. In the absence of network expansion and decongestion, there is no way to accommodate more trains or increase speeds (see link 4).

NITI Aayog findings
+ IR is pricing its AC service higher than an AC bus. Non-AC prices are much lower than road and rail service is better (see link 3). Air travel gives superior service, so not comparable.
+ IR will lose business by indiscriminate fare increases.
+ Instead, IR should reduce overheads and increase non-fare revenue. IR must also reduce high freight prices (which has dented India's competitiveness) and speed up accounting reforms.
+ Subsidy levels are overstated because IR uses broad amortisation of costs. It should use segregated marginal cost (see link 5).

Expert analysis
Vinayak Chatterjee et al (see link 6).
+ Hit by slow economic pace, coal and food-grain rationalisation; congested rail routes and dynamic road haulage rates.
+ Freight growth sectors captured by road, eg. parcels, white goods, auto, horticulture.
+ Discussions with big freight customers for long-term contracts; ease of doing business, liberal policies, discriminatory prices.
+ Stepped up rail physical targets: rail capex will exceed road sector spend.

Rail freight rate changes
Improves inherent strength of Railway in long-distance freight. It opens new business opportunity in higher revenue-earning operations, across varied freight sectors, eg. South is expected to shift from imported coal to rail (see link 7).

Surge pricing of Rajdhani, Shatabdi & Duronto
IR should garner extra revenue. US firm Amtrack doubled revenues (see link 8). Surge pricing helps to gauge market price elasticity. If average fares are set low, it will fill up low usage routes; but benefit doubly from a surge in demand. eg. an improved service will both shift demand to IR and give surge prices.

Railways Display Network
IR expects extra non-fare share of 2.5% & 4.0% in next 2 years from its RDN (100k in 2175 stations by 31-03-2017). ZeeTV will gauge the value of digital adverts before sites are e-auctioned (see links 9, 9a).

Long-term view
Good background Railways article (see link 10). Experts are very positive on DFC, minor & major port links, rail-auto, passenger traffic. New Rs 30,000 crore RIDF will provide equity funding for viable projects (returns 14-16%) (see link 11), underpinned by WB and MOF (link 12).

Bilaspur-Manali-Leh
Railways is also taking up non-viable, but strategic or social projects, eg. Rs 23,000 crore new line through hilly HP & JK (see link 13). National projects like B-M-L in J & K, or NE & DFC are funded by GOI (see link 14).

Railways need to complete projects on time to repay funds raised by IRFC