Islamabad: According to the latest report of the Auditor General of Pakistan (AGP), Pakistan Railways suffered a net loss of over Rs61 billion during the financial year 2024-25, which is Rs9 billion or 19.11 percent more than the previous financial year._x000D_
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State-owned enterprise (SOE) Pakistan Railways continues to face serious financial stability issues, the main reason for which is the widening gap between income and ongoing expenses._x000D_
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According to the audit report, Pakistan Railways incurred an operating loss of Rs60 billion in the financial year 2024-25, while the operating loss ratio reached 65 percent._x000D_
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Figures for the last five financial years show that the financial crisis is continuously intensifying. In the financial year 2024-25, the total income was Rs92.7 billion, while the total operating expenses reached about Rs153 billion._x000D_
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According to the report, operating expenses increased by 60 percent from 2020-21 to 2024-25, while operational losses increased by 29 percent, indicating the management’s failure to achieve financial balance (break-even)._x000D_
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The scope of the audit was limited to 84 out of 160 formations of Pakistan Railways, in which expenses of Rs 105.6 billion and receipts of Rs 84.25 billion were reviewed. During the audit, irregularities worth a total of Rs 34.42 billion were identified against Pakistan Railways and its subsidiaries._x000D_
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These included: budgetary irregularities of Rs 24.6 billion, weak financial management of Rs 11.2 billion, project management shortcomings of Rs 7.2 billion, and non-budgetary irregularities of Rs 11.5 billion related to land, assets and inventory matters._x000D_
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Under Revenue Grant No. 85, Pakistan Railways spent Rs. 154.212 billion against the final allocation of Rs. 157.839 billion, thus saving Rs. 3.627 billion (2.30 percent). Although this saving was within the prescribed 5 percent limit, the audit pointed out that the management did not utilize the available funds, despite the existence of large interest liabilities on foreign loans._x000D_
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Similarly, under Capital Grant No. 133, out of the budget of Rs. 34.799 billion, only Rs. 30.585 billion was spent while Rs. 4.214 billion (12.11 percent) could not be utilized. The Auditor General criticized this ineffective financial planning and said that the important resources provided by the federal government for infrastructure development were not utilized._x000D_
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According to the report, the total assets of Pakistan Railways in the financial year 2024-25 were worth Rs515.330 billion. However, revenue reserves remained frozen at Rs26.05 billion for the second consecutive year, indicating that the institution could not generate any retained earnings and its ability to be profitable in the long term is severely affected.
