According to officials and industry experts, several leading global and Indian restaurants and cafes have approached Indian Railways seeking information on rules for opening premium food and beverage outlets at stations, where they see greater sales potential than airports. The government had last month announced that it would allow established chains like McDonald’s, KFC, Haldiram’s, Wow Momo and Baskin Robbins to set up their outlets at railway stations.
According to officials, the first such outlets are expected to open in 2026. A senior official said in the ET report that we want to bring the experience of passengers at railway stations at par with that of airports. He said that the National Transport Company’s Catering Policy 2017 was amended last month, in which premium brand catering outlets have been included.
License will be given to branded chains
Sagar Daryani, president of the National Restaurants Association of India (NRAI), said the value of orders may be higher at airports, but railway stations provide an opportunity to operate on an unmatched scale. He said that with the right model, railway outlets can deliver very good returns on investment, which will be driven by sales volumes, short turnaround time (TAT) and low entry costs. The government has announced that it will conduct e-auction to allot five-year licenses to restaurant chains at over 7,000 stations. They can set up company-owned or franchise stores.
Special conditions will be made
The official said premium food outlets will have to maintain a significant improvement in the quality of food and service and will also have to pay a fixed license fee for space in the stations. Regional Railways will be allowed to make “special conditions” to ensure the viability of these restaurants while balancing the interests of passengers. According to a recent study conducted by retail group IRHPL, beverages are a significant contributor to food and beverage sales at airports, as soft drinks, coffee, juices and liquor account for 70 percent of airport food and beverage revenues. Officials said that food and beverage companies are expecting similar demand at railway stations also.
Companies will profit
A spokesperson for Haldiram’s, India’s largest packaged ethnic snacks maker, said that this policy opens up immense possibilities for the industry, and we definitely see many benefits from opening restaurants at railway stations. He further said that some minor issues remain to be resolved, and we are working closely with the government for this. If implemented properly, this will be the next big QSR (Quality, Service and Restaurant) business opportunity as people of all ages and socio-economic classes travel by trains.
Revenue will increase
NRAI President and Wow! Daryani, co-founder of Momo, said that as the operational frameworks mature, railways will become a major growth engine for formal food brands. The new outlets will assist the Railways in its efforts to increase non-fare revenue, which currently accounts for about 3 per cent of its total income. According to the assessment of NITI Aayog, there is immense potential in this sector, because in developed countries the non-fair revenue of railways is about 30 percent. Indian Railways earned non-fair revenue of Rs 588.07 crore in FY 2024 and Rs 686.9 crore in FY 2025.
