There is absolutely no need for any kudos.
Ever heard of the term "Subsidy" and "Economics of Scale" ??
For years, lower fares in GEN, SL and 3A Economy have been subsidised...
more... by hiking up the rates in the AC and Freights. Infact freight rates of IR are amongst the highest - in many cases it is cheaper and faster to send materials via road than via trains.
Secondly, economics of scale does play an advantage. IR has no direct competition and therefore its operations on a large scale effectively makes its operating costs to reduce. However, it has already lost the freight market to Golden Quadrilateral project and very soon Air Travel is going to be preferred since for a marginal increase in price- passengers can save a huge amount of time.
Though not in near foreseeable future, situation in IR will be that of US / Europe - people who have time and money will travel in trains. Rest will migrate to airlines. Of course, in a lower middle income country like India, there will always be a sizeable chunk of population who cannot afford the air fares and will definitely take the trains.