The public transporter attributes the fall to the rise in ticketless travel and shift in commuter preference due to improved condition of roads.
The Indian Railway has witnessed a negative growth of over 8 per cent in the passenger segment upto June this financial year as compared to the corresponding period last year, according to the Railway Ministry data.
A total of 2235.69 million passengers travelled by trains in the first three months of fiscal 2014 which came down to 2042.04 million this year, a decline of 8.66 per cent.
In the non-suburban section, 65.64 million passengers booked tickets as against 1013.01 million last year, a negative growth of 4.68 per cent.
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"The fall in passenger booking is a cause of worry and we are analysing the cause to take remedial measures," said a senior Railway Ministry official.
Besides ticketless travel (which has adversely impacted the earnings), people seem to be opting for road travel also as the condition of roads has improved a lot now, he added.
These drives resulted in detection of 1.6 lakh cases of unauthorised travel and recovery of Rs 9 crore in penalty.
According to Rail Budget 2015-16, Indian Railway's earning from passenger traffic was estimated to rise by 16.7 per cent to Rs 50,175 crore for the current fiscal, envisaging more people travelling by trains. It estimated 860 crore passengers to travel by trains.
However, if the current trend is not reversed, it would be difficult to meet the target, said the official.
Prabhu had announced in the Budget that freight traffic would grow from 1,101 MT in 2014-15 to 1,186 MT in 2015-16, an increase of 85 MT.
It was expected that the additional 85 MT would come from increased loading of coal, iron ore, cement and foodgrains.
However, barring coal, the loading of iron ore, cement and foodgrains recorded negative growth during the first two months of this fiscal as compared to the last year.