I.R is is owned/controlled/operated by the Central Govt. of India.If the Govt.Of India decides that it can no longer run such a vast network it could sell it's stake either fully or partially depending upon it's needs to Privately owned enterprises.Like for example - Reliance,Tata or someone else.When such an event takes place one can say - Railways is "Privatized".
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+ives - Improved service,better execution of projects,improvement of infrastructure.
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-ives - Charges could go up substantially and traveling in Railways would turn costly.
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P.S - Railways has always been used as a "Political Tool" and is a "Sensitive Issue" and the "Railway Union" is very strong.........Privatization will never happen in the coming 50 to 70 years,atleast!!!!!
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Partial stake sale can happen but complete sale of I.R to a private company or to a consortium would never happen in the next 100 years in a country like India.