Consumers seek tariff rationalization on a dedicated freight corridor

Stakeholders using the Dedicated Freight Corridor (DFC) are calling for fares to be rationalized to attract more consumers to the rail network. Container train operators and port stakeholders say that while the DFC reduces the time it takes for goods to move and ensures predictability, cost is a barrier to adoption.

APM Terminals, a unit of Danish shipping giant Maersk, is seeking rationalization. Its Pipavav terminal on the Gujarat coast has direct access to key markets in North West India and India’s largest seafood export belt via road and rail, including direct electrified access to the Western Dedicated Freight Corridor.

“Today, our trains from Khatuwas (near the Haryana-Rajasthan border) arrive at our port in less than 24 hours. It used to take 3-4 days,” said Girish Aggarwal, Managing Director of APM Terminals Pipavav. He added that the western DFC has significantly reduced the travel time of goods between north India and the west coast.

But despite the increase in comfort, consumers still shy away from using only the rail connection.

“From our point of view, the money must now be passed on to the customer. If you start doing that, a lot of road traffic will be diverted to rail,” Agarwal said, calling for a reduction in DFC tariffs. According to him, people from Delhi, Sonipat and Panipat come by truck when it should be by train.

Manish Puri, President of the Association of Container Train Operators (ACTO), commented on the need to rationalize rail fares: “Rail is more expensive than road in the light goods category. This is because charging is directional on the street. For example, light goods are cheaper in the export direction by road than by rail.”

Nanduri Srinivas, Director, Operations and Business Development at Dedicated Freight Corridor Corporation of India (DFCCIL), responded to an inquiry about these calls to rationalize tariffs for DFC: “At the moment, DFC follows the same tariffs as Indian Railways for conventional Traffic “.

Double stacking solution

Puri said that double stacking reduces container unit costs by about 25%. “Double stacking makes rail much more competitive than road. Nowadays there is a limit to how much double stacking is possible as certain weight classes are not allowed,” he said, noting that this needs to be smoothed out.

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