A power crisis on an old track and a plan that was never implemented

The Railways' decision to stick with steel wagons may have contributed to the shortage of rakes to haul coal to generating plants

The Indian Railways has had a solution to the current crisis of wagon shortage for the past two decades, but never implemented it. The idea was to consider the use of aluminium progressively to build wagons, adding to its steel and stainless steel made fleet. This transition would have cut costs and substantially added to freight haulage capacity without adding more engines, crew or fuel costs. The initial higher investment would have been repaid by higher capacity.

This year, the Railways is gasping to balance demands from the thermal power industry for faster coal supplies with the demands of other industries. It has to keep rakes ready to meet the rising demand for just about every other bulk commodity, from cement and steel to sand and food grains. The organisation has a stock of 304,582 wagons as of March 2022. This is clearly a woefully inadequate number, which is why Railway Minister Ashwini Vaishnaw has rushed to announce plans to add 90,000 wagons in three years. These will be built with stainless steel. The first of those tenders is already out. Titagarh Wagons has won the contract to supply 24,177 of those wagons, at a cost of Rs 7,838 crore to the Railways, according to the company’s notice filed with the Bombay Stock Exchange.

Finance Minister Nirmala Sitharaman had, meanwhile, indicated plans to expand the use of aluminium in passenger coaches. In her Budget speech this February, the minister said 400 more Vande Bharat trains will be introduced. These, it is understood, shall be made mostly of light-weight aluminium. It is interesting that while the Indian Railways is willing to switch to aluminium-based passenger coaches, it is not ready to ask private sector wagon suppliers to consider the same idea, even after debating it for almost two decades.

The Railways had warmed to the idea of aluminium wagons in 2003 and asked its research arm, Research Designs and Standards Organisation (RD&SO), to develop a techno-economic feasibility study. In its report, RD&SO noted, “Aluminium wagons besides being of a lower cost and having a lower tare weight [the weight of an empty vehicle], also have the advantage of suffering less corrosion in many circumstances. A typical rake with aluminium wagons instead of steel ones would carry almost 240 tonnes more goods.”

Naturally, the aluminium industry lobbied for this transition. In 2001, the government had privatised Balco and production of aluminium had begun to expand both from it, as well as from state-owned Nalco. The mines ministry encouraged the Railways to make the switchover. Secretary, ministry of mines, A K Kundra told the media he had sent the Railways a proposal to this effect.

The tare weight of a steel wagon is typically 21 tonnes. With a full load of 55 tonnes, the combined weight is 76 tonnes on the rail lines. An aluminium wagon is lighter. “Our present ratio (gross load to tare) is 2.5. With aluminium we can double this,” said a railway ministry official. A recent paper in the global trade magazine FreightWaves noted, “With more tonnes per loaded railcar, fewer railcars and less fuel are required to transport a given amount of freight.”

“The initial cost is high and that prevented any further move even though aluminium wagons last longer, are relatively easy to handle and there are examples of their use from railways across the world,” said Sunil Chatur­vedi, chairman and mana­ging director of capital goods firm Gainwell Commosales and a former IAS officer with some experience of handling the Railways.

Predictably, the domestic iron and steel industry lobbied against the switch. The national steel policy of 2017 estimates the current total usage of steel in railways at 3 per cent of its total output and this is expected to grow. Matters were also helped by a Railways policy that insists that it retain all intellectual property rights on designs for its coaches, locomotives and wagons.

“Even now the Railways acquires the design of the wagons even though their production is largely with the private sector by paying them a royalty. If the companies make any subsequent improvements in design those too have to be shared with the Railways, which will offer the same to the competitors,” said Mukesh Kumar Singh, former CMD of Ircon, a railway consultancy enterprise.

But the best of the new technology could only come from abroad. Those companies were willing to build the wagons here but would not share their technology. In their absence, the domestic designs by RD&SO did not offer a compelling cost advantage. The decision therefore stalled.

Other than the challenge of initial costs was the un­stated fear that a switchover to the new rakes would make redundant the large infrastructure built to service the wagons. This included investments made by private sector comp­anies, too, which in turn had spawned a large ancillary ind­ustry. It was not clear how and to what extent the foreign supplier companies would replicate such an environment.

Messages to companies (such as Titagarh Wagons) on the issue remained unanswered. Though no Railways official was willing to comment on the issue on the record, in debates within the ministry, they held up the risks of using aluminium in handling bulk cargo. A decade ago (September 2012), the Railway Board had flagged the risk of damages to even the steel-built railway wagons by the use of mechanised loading of bulk cargo without safeguards. Based on this, RD&SO was asked to “frame standard instructions to customers to regulate use of such mechan­ized loading/unloading equipment”. Singh said those risks of damage to railway wagons would be far higher for aluminium-built wagons.

The basic challenge, as the FreightWaves article notes, is the comparison of costs. There will be a higher cost to make the switch, but compensating those would be savings from fewer journeys. The savings will be on fuel budgets, fewer employees and therefore making do with less investment for new wagons. Busier routes will have faster turnarounds. Fewer trips will also mean a positive environmental footprint for the Railways.