 "Railways to give top priority to finish dedicated freight corridor project")
Railway Minister will give top priority for completing Dedicated Freight Corridor (DFC) project, India’s ambitious attempt to reform freight transport. Stating this in his railway budget speech, Railway Minister Suresh Prabhu said, “The Dedicated Freight Corridor project, the largest infrastructure project in the country, is gaining momentum. It is proposed to take up three freight corridors - North-South connecting Delhi to Chennai, East-West connecting Kharagpur to Mumbai & East Coast connecting Kharagpur to Vijayawada - on high priority to ensure structuring, award and implementation in a time-bound manner through innovative financing mechanisms including PPP.”
Before the closing of this financial year, Minister plans to award almost all the contracts for civil engineering works. Prabhu said, “Given the emphasis on rapid expansion of freight business, it is essential to build more dedicated freight corridors for increased traffic with consequent benefits for the economy and environment. Since assuming the office, contracts worth Rs 24,000 crore have been awarded against Rs 13,000 crore worth of contracts in the last 6 years.”
For reversing the trend of declining modal share of freight trains, Suresh Prabhu has proposed to expand freight basket of Indian Railways, rationalise tariff structure and build terminal capacity.
The freight basket of Indian Railways is dominated by 10 bulk commodities which enjoy a share of around 88 percent. Indian Railways will have to look beyond these to expand revenue base. The Ministry is currently undertaking a full-fledged market study to assess supply and demand scenarios, service level and infrastructure requirements so that an action plan to re-capture that traffic through either containerisation or new delivery models, eg, roll-on roll-off, will be developed and implemented.
Network capacity limitations do not allow for running of time-tabled freight trains but from this year a time-tabled freight container, parcel and special commodity trains will be started on a pilot basis.
Prabhu also said that the container sector would be opened to all traffic barring coal and specified mineral ores and part-loads would be permitted during the non-peak season. All existing terminals/sheds would be granted access to container traffic, where considered feasible.
He said that the current tariff structure of Indian Railways has led to out-pricing of freight services. A review of tariff policy will be undertaken to evolve a competitive rate structure vis a vis other modes, permit multi-point loading/unloading and apply differentiated tariffs to increase utilisation of alternate routes. “The possibility of signing long term tariff contracts with our key freight customers using pre-determined price escalation principles will be explored which would provide predictability of revenues to Indian Railways and of costs to customers,” Prabhu added.
Before the closing of this financial year, Minister plans to award almost all the contracts for civil engineering works. Prabhu said, “Given the emphasis on rapid expansion of freight business, it is essential to build more dedicated freight corridors for increased traffic with consequent benefits for the economy and environment. Since assuming the office, contracts worth Rs 24,000 crore have been awarded against Rs 13,000 crore worth of contracts in the last 6 years.”
For reversing the trend of declining modal share of freight trains, Suresh Prabhu has proposed to expand freight basket of Indian Railways, rationalise tariff structure and build terminal capacity.
The freight basket of Indian Railways is dominated by 10 bulk commodities which enjoy a share of around 88 percent. Indian Railways will have to look beyond these to expand revenue base. The Ministry is currently undertaking a full-fledged market study to assess supply and demand scenarios, service level and infrastructure requirements so that an action plan to re-capture that traffic through either containerisation or new delivery models, eg, roll-on roll-off, will be developed and implemented.
Network capacity limitations do not allow for running of time-tabled freight trains but from this year a time-tabled freight container, parcel and special commodity trains will be started on a pilot basis.
Prabhu also said that the container sector would be opened to all traffic barring coal and specified mineral ores and part-loads would be permitted during the non-peak season. All existing terminals/sheds would be granted access to container traffic, where considered feasible.
He said that the current tariff structure of Indian Railways has led to out-pricing of freight services. A review of tariff policy will be undertaken to evolve a competitive rate structure vis a vis other modes, permit multi-point loading/unloading and apply differentiated tariffs to increase utilisation of alternate routes. “The possibility of signing long term tariff contracts with our key freight customers using pre-determined price escalation principles will be explored which would provide predictability of revenues to Indian Railways and of costs to customers,” Prabhu added.
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