Railways tweaks Coal loading freight rates to mop up Rs 1000 crore
The Railways has rationalized its freight rates for coal loading, a move expected to help the financially stressed national transporter cover the losses due to less-than-expected business and mop up additional revenue of Rs 1,000 crore.
According to a notification issued by the Railways, freight rates on movement of coal up to 100 km will be unchanged while those for 200-700 km will be increased 8-14 per cent and the rates for distances over 700 km will be cut 4-13 per cent.
The railways will also levy coal terminal surcharge at the rate of Rs 55 per tonne at both loading and unloading terminals for traffic of coal for distances beyond 100 km. Senior railways officials said that the move will help offset the fall in revenues in the first four months of the current financial year due to a decline in coal loading, which fell short of the target by at least 30 million tonnes.
"You can't call it a hike in freight rates. Basically, we have rationalised freight for various slabs. The hike in medium distance is marginal," Mohd Jamshed, member traffic-Railway Board said. Owing to the reduction in freight rates on coal movement to destinations that are more than 700 km away, the net loading will increase and the railways will get more traffic, Jamshed said.
"Also, the last-mile connectivity from pithead to power plants will remain unaffected as charges for under 100 km of movement have been left unchanged," he said. The railways saw a 7.74 per cent decline in freight earnings in July from that a year ago while freight traffic went down 1.88 per cent to 89.34 million tonnes.
The drop was on account of coal, a bulk commodity for the railways. It gets more than 45 per cent of its total revenues from coal loading. In the current fiscal, the railways have set a target of about Rs 1.7 lakh crore from freight loading.