Plans to streamline freight transport in Punjab; State government to lease freight trains from Railways

August 21, 2026

The Punjab government is working on a new scheme to boost industrial activity and facilitate the faster transport of goods from the state to various parts of the country. The government is preparing to lease freight trains equipped with special rakes from Indian Railways. A proposal regarding this is currently being drafted and will soon be submitted to the Union Ministry of Railways.

Chief Minister Bhagwant Singh Mann has also confirmed this initiative. The state government believes that providing regular and reliable rail facilities for transporting industrial goods could give new momentum to the state’s business sector. Additionally, it is expected to reduce transportation costs for entrepreneurs and traders.

Plans to connect major industrial cities with ports

The scheme focuses on establishing better connectivity between Punjab’s key industrial hubs—such as Ludhiana, Jalandhar, Amritsar, Mandi Gobindgarh, Rajpura, and Bathinda—and the country’s major commercial markets and seaports. The government is considering implementing this system in collaboration with the Railways under a Public-Private Partnership (PPP) model.

A major benefit of this initiative is that it could relieve traders of the long waiting periods typically associated with booking freight train rakes. The government plans to provide special rakes that can be loaded with goods in Punjab and dispatched directly to their designated destinations. This would make the freight transport process more organized and time-efficient.

Potential reduction in transportation costs compared to road transport

Currently, a large volume of industrial goods from Punjab is transported to other states and ports via trucks. Transporting large quantities of goods by rail offers the potential to reduce logistics expenses, as a single freight train can carry thousands of tonnes of cargo. Consequently, traders could gain significant economic advantages when transporting goods on a large scale. Lower transportation costs could also have a positive impact on company profits. Access to dedicated rakes will help businesses reduce their reliance on trucks for transporting goods. This will also increase the likelihood of delivering cargo to its destination within a stipulated timeframe.

Benefits for MSMEs and the Export Sector

A large number of Micro, Small, and Medium Enterprises (MSMEs) operate in Punjab, and the movement of goods is a critical requirement for them. The government’s proposed plan is expected to facilitate the transport of products from these businesses to other states or ports.

Many industries in Punjab are export-oriented. If containers dispatched from the state reach ports on time, orders from international clients can be fulfilled punctually. This could also help enhance the competitiveness of Punjab’s products in the global market.

Focus on Boosting Investor Confidence

The Punjab government does not intend to limit this scheme solely to freight transport; it also aims to strengthen the state’s industrial infrastructure and attract new investments. The government believes that improved logistics facilities will aid in the development of large industrial parks and boost the confidence of new entrepreneurs looking to invest in the state. Promoting rail-based freight transport will also open up opportunities for developing warehouses, logistics centers, and other transport-related facilities within the state.

Industries Expected to Benefit

Punjab is home to major industries involved in textiles, bicycles, machine tools, agricultural equipment, steel, and sports goods. Products from these sectors are transported to various parts of the country as well as to ports for export. Currently, a significant volume of goods is transported by road to markets in Mumbai, Gujarat, Chennai, Kolkata, and South India.

Transporting goods via trucks drives up costs for companies due to expenses related to fuel, tolls, and other logistics charges. Furthermore, the availability of an adequate number of trucks cannot always be guaranteed. Delays in delivery can occur due to traffic jams on national highways or other factors. In the export sector, such delays can pose a major challenge for businesses. The primary objective of the Punjab government’s proposed scheme is to establish a cost-effective, rapid, and reliable freight transport network for industries. If the Railways introduces a dedicated rake facility, Punjab’s industries will gain an additional, organized option for transporting goods to major markets and ports across the country.

The Punjab government is now preparing a proposal for this scheme to submit to the Union Ministry of Railways. Subsequently, the plan will be taken forward based on discussions with the Railways and the receipt of necessary approvals. Chief Minister Bhagwant Singh Mann aims to accelerate this initiative to give fresh momentum to Punjab’s industrial development.