The Bombay Baroda and Central India Railway (BB&CI), one of the first guaranteed railway companies in India, opened the Ankleshwar- Bharuch broad gauge line on June 22, 1860. Earlier in 1855, sensing the prosperity railways could bring to the state, the Maharaja of Vadodara state (then called Baroda) Ganpatrao had given permission to BB&CI for constructing railway lines in his state. Bharuch-Baroda broad gauge line was inaugurated on January 9, 1861. By this time, Khanderao had become the new Maharaja.

Dabhoi in Baroda state was an important trading centre. In early 1850s Khanderao, had built a line between Miyagam Karjan and Dabhoi. It was on two feet six inch gauge with rails weighing 13 lbs to a yard. The line was designed and constructed by A W Forde. A pair of oxen used to haul trains composed of 4-6 vehicles. Why did Khanderao choose narrow gauge over the-then popular broad gauge? This question remains unanswered. He was probably persuaded by sales personnel from Neilson locomotive company to buy narrow gauge locomotives for the line and hence chose the narrow gauge. In 1863, Khanderao purchased three steam locomotives built by Neilson and Co., Glasgow. These 0-4-0 tank locomotives proved to be too heavy for the rails and were soon removed from duty. The line was not managed properly in the early years and ended up being a financial drain on the state exchequer. As a result, services were closed and over time some of the rails and bridges woodwork were stolen.

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