This paper formulates and analyzes a strategic model for Pakistan Railways. The objective of the model is to understand the potential consequences of investment strategies aimed at establishing operational and financial sustainability of the Pakistan Railways. The model replicates a wide range of inter-connected causal relationships between different factors to reflect the decision making process in the sectors including Rolling stock (passenger coaches and locomotives), Maintenance of Rolling stock, Tracks, Maintenance of Tracks, and Finance. The model incorporates how these sectors interact to each other over time. The model can be used for evaluating potential outcomes of individual and combinations of individual investment strategies implemented at different times. The conclusion derived from the model experimentations indicates that a better operational policy for the Pakistan Railways to improve its operational performance and financial sustainability would constitute expanding the track capacity with increased provision for maintenance capacity.