Mr Prabhu was moved out of the important Railway Ministry and was handed over the Commerce and Industry portfolio in the cabinet reshuffle.
The development comes after Mr Prabhu took moral responsibility for the Kalinga Utkal Express' derailment near Khatauli in Uttar Pradesh's Muzaffarnagar district on August 19 that killed 23 people. Two more trains derailed last month.
Soon after the Khatauli tragedy, Mr Prabhu had met with Prime Minister Narendra Modi and said in a series of tweets that he took full responsibility for the accident, but was asked to "wait". This was seen as an indication that he would be ejected from the key infrastructure ministry.
"Every responsibility of the government is important and this is my ninth cabinet level position," Mr Prabhu said. "I am extremely happy that the prime minister has asked me to do something in Make In India, Start-up India, and ease of doing business in India. All of these are the flagship programmes of the government which have to be implemented and I look forward to doing that in the right earnest," he said.
Mr Prabhu said he has identified export-intensive industries as an area where large number of jobs can be created.
"We have a big challenge of improving employment. We need investments in India which have to be supplemented by FDI (foreign direct investment); we need to increase exports so that competitiveness improves as well as more jobs are created through export-intensive industries," Mr Prabhu said.
Soon after the oath-taking at Rashtrapati Bhavan ended, where Mr Goyal and three other Ministers of State were elevated to cabinet rank and nine new faces inducted into the council of ministers, Mr Prabhu tweeted indicating his exit from Rail Bhavan.
"Thanks to all 13 Lacs+ rail family for their support, love, goodwill. I will always cherish these memories with me. Wishing you all a great life," he said.
Wishing the fresh faces to the Council of Ministers, Mr Prabhu said, "Congrats to all members of #TeamModi for new responsibility. Making our country better is our common mission."
He also congratulated Mukhtar Abbas Naqvi, Dharmendra Pradhan, Nirmala Sitharaman and Mr Goyal who have been elevated as cabinet ministers.