In a major festive relief ahead of Diwali, the Union Cabinet has approved a productivity-linked bonus worth ₹1,866 crore for 10.90 lakh railway employees across India. The announcement was made by Union Minister Ashwini Vaishnaw, who confirmed that eligible employees will receive a bonus equivalent to 78 days of their wages.

This decision, hailed as a Diwali gift from the Modi government, is expected to provide a significant boost to household spending and retail demand during the festive season.

Who Will Benefit From the Bonus?

According to the Railway Ministry, the bonus will benefit a wide range of employees working in different categories, including:

• Track maintainers

• Locomotive pilots

• Train managers (guards)

• Station masters

• Supervisors

• Technicians and their helpers

• Pointsmen

• Ministerial staff

• Other Group ‘C’ employees

The maximum payout per eligible employee has been capped at ₹17,951 for 78 days.

A Tradition of Annual Bonuses

This is not the first time railway employees have received such benefits. Last year, the central government sanctioned a productivity-linked bonus worth ₹2,029 crore, benefitting nearly 11.72 lakh employees.

The continuation of this practice highlights the government’s recognition of the critical role railway staff play in keeping one of the country’s largest transport systems operational and efficient.

Festive Season Impact

The bonus announcement comes at a strategic time, just ahead of the festive shopping rush. Retailers and businesses, already anticipating higher demand following recent GST rate cuts in several product categories, are expected to benefit further from this injection of disposable income into households.

Railway employees form one of the largest consumer groups in semi-urban and urban India. Experts believe that the bonus payout will translate into increased spending on:

• Electronics and home appliances

• Consumer durables

• Clothing and footwear

• Festive essentials such as sweets, decorations, and gifts

As a result, the retail sector is bracing for a surge in sales, which may help drive overall economic activity in the coming quarter.

Cabinet Approves ₹95,000 Crore Projects

Alongside the railway bonus, Minister Vaishnaw also announced Cabinet approval for infrastructure projects worth ₹94,000–95,000 crore across various sectors.

One of the key approvals is the doubling of the Bakhtiyarpur–Rajgir–Tilaiya railway line. Until now, the line has operated as a single track, limiting its capacity. Doubling the line will significantly enhance operational efficiency, reduce congestion, and increase the railway’s ability to serve the growing passenger and freight demand.

Highlighting the importance of these developments, Vaishnaw stated:

“Prime Minister Narendra Modi has taken some truly historic decisions. Today’s Cabinet meeting cleared projects worth nearly ₹95,000 crore, which will create long-term benefits for the economy as well as improve railway infrastructure.”

Broader Significance

The dual announcement—railway employee bonuses and large-scale infrastructure approvals—reflects the government’s strategy to:

1. Support consumption-driven growth through direct payouts like bonuses.

2. Invest in long-term infrastructure development, ensuring capacity expansion and efficiency in the railway sector.

Economists suggest that while the bonus will boost short-term demand, the railway line upgrades and other projects will have lasting benefits, including better connectivity, improved logistics, and job creation in related industries.

Conclusion

For millions of railway employees, the Modi government’s decision comes as a timely Diwali gift, providing financial relief and boosting morale. For the economy, the move is expected to drive consumer spending and retail activity at a crucial festive juncture.

Coupled with massive infrastructure investments, the Cabinet’s decisions underline a dual approach—supporting immediate household consumption while strengthening the nation’s long-term growth prospects.