Int. J. Logistics Systems and Management, Vol. 42, No. 1, 2022 117 Copyright © 2022 Inderscience Enterprises Ltd. Operational policies based on fare-box revenue management of the Indian railways Sundaravalli Narayanaswami* and Lakshya Singh Saini Public Systems Group, Indian Institute of Management, Ahmedabad, India Email: sundaravallin@iima.ac.in Email: p16lakshyas@iima.ac.in *Corresponding author Abstract: Indian railways (IR) is one of the oldest and single largest public transportation organisations in the world. Many of the routes and services are not profitable, but IR, being a state operator is obliged to operate them for political and social obligations. We developed a framework to compute the operational cost per trip of an IR passenger service using actual data. The total operational cost was evaluated against generated revenue, and it was found that break even could not always be attained. The proposed framework mandates significant changes in IR thought process and operational policy decisions, but it is pragmatic, viable and does not compromise customer benefits, we believe. We present the framework; illustrate the same using real data from few premium services and our detailed analysis. Keywords: total cost of operations; profitability of trains; operating costs; fare-box revenues. Reference to this paper should be made as follows: Narayanaswami, S. and Saini, L.S. (2022) ‘Operational policies based on fare-box revenue management of the Indian railways’, Int. J. Logistics Systems and Management, Vol. 42, No. 1, pp.117–139. Biographical notes: Sundaravalli Narayanaswami is on the faculty at Public Systems Group, Indian Institute of Management Ahmedabad, India. She earned her PhD from the Indian Institute of Technology (IIT) Bombay, after her Masters in Computer Science. Her teaching/research interests are in intelligent urban transportation, operations research, operations management, logistics management and SCM. She has taught at various institutions in India and abroad. Lakshya Singh Saini is currently working as a Consultant with Accenture in its Bengaluru office (India). He is providing consulting services in fields related to aviation, railways, supply-chain, logistics, and freight management. He received his BE degree in Mechanical Engineering from Punjab Engineering College, Chandigarh, India, in 2013, and his postgraduate diploma from the Indian Institute of Management (IIM) Ahmedabad, India, in 2018. His main areas of research interest include multimodal transportation, intelligent transportation systems, urban transit system planning, travel behaviour, and demand modelling.