Crri Differs With Railway On Drop In Freight Traffic

The Central Road Research Institute (CRRI), a wing of the Council of Scientific & Industrial Research (CSIR), disagrees with the assessment of the Railways that the drop in railways freight traffic in recent months was entirely due to the slowdown in economic growth.

The issue assumed significance as the incremental growth of railway freight traffic, which had averaged 2 million tonnes a month during April-October, dropped to 1.2 million tonne in November and further to 0.6 million tonne in December. The Railways attribute this to the recession in the economy.

CRRI director A K Gupta, however, says their studies point to a constant diversion of freight traffic from railways to roads, leading to a corresponding erosion in railway freight traffic.

 

Speaking to Business Stan-dard, he also pointed out that railway freight rates have been increasing in recent years and that the rates were again raised in August. This may also have contributed to the decline in railway freight traffic, he added.

But he added that the rate hike factor may not be of crucial importance as railways continue to be the cheaper mode of goods transport despite the latest freight rate hike. Besides, there have also been hikes in diesel prices, adding to the costs of road transport.

However, road transport becomes more lucrative than railways if the intangible factors are taken into account. For instance, the cost of rail transport per tonne per km may appear more attractive than that for road transport if one takes into account the quicker and better services offered by road as well as door-to-door pick up and delivery services.