The railroad system was used by an average of 1.5 million passengers annually from 1985 to 1989. Goods transported averaged between 15,000 and 19,000 tons annually during that same period. Although service in Nepal was limited, lines south of the border ran through India.

Railroad service was initiated in 1928 and generally connected the commercial centers of the Tarai with Indian railheads near the border. The Janakpur Railway, headquartered in Jaynagar, India, was a fifty-three-kilometer narrow-gauge railroad between Jaynagar and Janakpur and Bijalpura in Nepal. As of the late 1980s, its equipment consisted of ten steam locomotives, twenty-five passenger coaches and vans, and fifty-two freight wagons. The Nepal Government Railway consisted of forty-eight kilometers linking Amlekhganj to the railhead in Raxaul, India, and was equipped with seven steam locomotives, twelve coaches, and eighty-two wagons. The opening of a north-south highway, however, made the railroad service from Raxaul to Amlekhganj somewhat obsolete. The Sixth Five-Year Plan provided for construction of a rail line between Udaipur Garhi in eastern Nepal, and Calcutta.

Data as of September 1991