Telescopic Fares Likely To Stage A Comeback

There is a strong possibility of the telescopic freight rates being brought back in the next railway budget. This will make long distance freight much cheaper than now and help attract long distance traffic, which was being lured away by the road transport sector.

The telescopic freight allows a smaller rate of increase in the freight slabs for longer distances.

Therefore, the freight rates will not increase in the same proportion as the rate in shorter distance freight movement. In fact, the same telescopic fare principle is followed in fixing passenger fares. And, the same proven principle had been in vogue for decades before the government decided to introduce the controversial flat rate slabs where freight rates increased at the same rate for each slab.

 

If the railways expected a hefty increase in income by the flat tariff formula, it was mistaken. The long distance traffic is slowly moving away from rail to the road transport sector. And, the road transport has the additional advantage of making delivery at the door step.

The populist railway budgets where passenger fares have been largely left untouched and freight rates increased steeply, have become counter-productive. There has been as much as 23 per cent increase in freight rates during the two rate hikes in August, 1996 and April, 1997.

The rates have become uneconomic. The road transport sector is taking full advantage of this and lot of potential freight has been diverted to road.

There is a school of thinking which within the railways which advocates differential rates of passenger fare depending on the season of the year and even hour of the day. A surcharge on normal fare for peak hour and peak season travel could help in controlling the rush for tickets. On the other hand, travel during off-peak hours of the day and off-peak season of the year can be made slightly cheaper with concessional rates.

Sources feel the thinking is not new. But, the idea is considered to be too controversial to be given a shape. But, a way has to be found to regulate the rush for reservation during peak season and encourage full occupancy during off-peak season.

The same principle can be applied for travel during different hours of the day. A commuter will choose to travel in non-peak hours to save surcharge in fare. Similarly, more commuters can be attracted during off-peak hours when trains go empty. This is true mostly for short distance and suburban train services. Since major tinkering with passenger fares is never popular, railway officials are trying to invent new ideas to increase revenue from passenger fare without appearing to be making major changes.

And, full utilisation of capacity by attracting commuters in off-season, and off-peak hours will automatically bring more revenue.