The Hindu Business Line : Rlys offers discounts to Reliance, Lloyd Steel, Ispat

In a bid to attract additional traffic to the rail sector from roads, Indian Railways has entered into long-term special incentive schemes with Reliance Logistics, Lloyd Steel and Ispat Industries.

While the specifics of the agreements are different, they are broadly structured in such a manner that the extent of discount over the prevailing tariffs offered to the companies are higher if they move higher volumes of goods by Railways in certain specified sectors for specific commodities. The validity of all these agreements is about two and a half years—they lapse on March 31, 2010.

When contacted, officials said that these proposals were made by various zonal Railways from where the traffic could originate, based on assessments made about the potential traffic that could be generated for the Railways from these companies.

Discounts

For instance, Reliance Logistics would get a five per cent discount in busy season and 10n per cent in lean season if the company uses 1-11 rakes per month to move petroleum coke from Moti Khavdi and proposed siding of Reliance Refinery in Rajkot division to various destinations.

If Reliance offers 12-20 rakes of traffic per month, it would get 10 per cent discount in busy season and 12.5 per cent discount in lean season; for 21-30 rakes per month, the discount levels move to 12.5 per cent (busy season) and 15 per cent (lean season) and so on. For Reliance, such graded discount levels touch a maximum level of 25 per cent (lean season) and 20 per cent (busy season) if the company loads petroleum coke in over 50 rakes per month for various destination from the decided points of origin.

This is valid from October 1 to March 31, 2010. Similarly, Lloyd Steel can get 10 per cent discount for moving iron and steel from Wardha in Nagpur division provided it loads up to 67 rakes per annum. If the company loads 68-111 rakes, it gets a 15 per cent discount, and for loading over 111 rakes in a year, Lloyd Steel can get 18 per cent discount.

And for Ispat Industries Ltd, the Railways has offered a 10 per cent discount in busy season and 20 per cent discount in lean season provided the company moves hot rolled coils from Pen (in Raigarh) to Meghnanagar and Ballabhgarh.

For both Lloyd Steel and Ispat Industries, the duration of the scheme is from November 1 to March 31, 2010.