Indian Rlys losing revenues from Karachiya yard

The increasing use of pipelines to transport crude oil in the country has taken away the glory of the Indian Railway's largest earning yard ""Karachiya yard.

This yard is now facing competition from the upcoming petroleum and crude oil pipelines that are spreading across the nation.

The earning of the yard has gone down from Rs 1.87 crore a day in 2002-03 to Rs 1.5 crore per day during the current year.

"The earnings and number of wagons have gone down as companies are pumping more crude oil and petroleum through pipelines," said S K Jha, senior divisional operations manager, Vadodara.

He further said that five years ago, pumping crude oil through pipeline was at 15 per cent which has now increased to 25 per cent.

The Karachiya yard mainly caters the demands of Gujarat Refinery. The traffic movement is mainly towards the northern India like U P, Bihar, Punjab and in eastern region like West Bengal and Assam. While it transports naphtha to Kandla port and Jasagichali near Mumbai that further gets exported.

"After the advent of pipelines, the Karachiya yard has lost 12 per cent market share," informed Jha. However, the interesting part is that the overall demand at the national level has increased upto 6 per cent which is even true for the Karichiya yard, he added.

However, Jha made it clear that it is the changing senenario that had led to the diminution of Karachiya yard.

Jha elaborated that companies prefer to use pipeline as its more economical, safe and has less transit loss.

The other reason that has affected the revenue generation from the Karachiya yard is the last year's reduction of the tariff on petroleum products by the railways at 5-6 per cent in order to beat the competition faced by the alternative transit mode like pipelines, informed Jha.

Considering past ten years, 2003-04 was the peak year for Karichiya yard, said Jha.

In the year 2002-03, the total number of tank wagons reached upto the highest number that is 1,000 tank wagons per day bringing in the highest revenue for the railway amounting to Rs 684 crore per annum that is Rs 1.87 crore per day.

"The number of tank wagons has gradually reduced in 2004-05 up to 797 tank wagon and it remains somewhat same for the current year as compared to 2002-03, hence reducing the per day average revenue to Rs 1.5 crore per day," added Jha.

Backed with statistical evidence, Jha said, in year 1995 the demand at Karachiya yard was 9.5 million tones per annum which has increased to present 11.5 to 12 million tones per annum.

The railway authorities believe that they will not be affected from the short distance pipelines but it will be certainly affect the railways business if long distance pipelines comes up. "The pipeline spread upto 500 km is fine with us but more than that would hinder the railway substantially," said Jha.

The Kandla-Bhathinda pipeline is one such pipeline that had led to the loss of Rs 400 crore to the railway, he informed. "Railways had never looked for the short distance transportation of crude as its main business" added Jha.