Coal Shores Up The Bottom Line

An increase in coal transportation to thermal power stations has helped the railways exceed targeted freight realisation for 1997-98. The railways have gained an additional Rs 563.66 crore for the year 1997-98 from freight transportation.

According to figures provided in the railway budget for 1998-99, realisation from coal transportation to thermal power stations has exceeded the target by around Rs 1,740 crore.

Coal transportation to thermal power stations contributed Rs 6,752.4 crore in 1997-98 as against a budgeted figure of Rs 4,499.55 crore. Against this, coal transportation to public sector undertaking showed a massive reduction of around Rs 1,440 crore.

Coal transportation to power stations accounted for 19 per cent of the increase in the realisation from coal transportation for the year 1997-98.

The government had initially targeted a 52 per cent contribution from this sector and 39 per cent from coal transportation to PSUs. As against this, the railways realised 71 per cent of their revenue from transporting coal to power projects and only 21 per cent from PSUs.

A back of the book calculation shows that the railways would have had a shortfall of around Rs 1,180 crore during 1997-98 even if the they realised the amount that was budgeted for in 1997-98.

The increase in coal transportation to thermal power stations is due to the thrust given by the government to increase generation from the existing power projects.

Thermal power projects across the country showed an increase in the average plant load factor by 5-10 per cent during the year. Coal transportation to these thermal projects showed a substantial increase by 10 per cent as against a targeted amount of 86,614 million tonnes.