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Mamuni Das

New Delhi, Nov. 6 Indian Railways has announced reductions of 10-50 per cent in freight charges for long distance iron ore export traffic. The percentage of reduction will depend on parameters like the distance and zone from which the iron ore will be loaded.

The reductions would be applicable for iron ore traffic loaded in South Eastern, East Coast and South Western Railways and for distances above 350-400 km. Significant volumes (roughly 60-70 per cent) of iron ore export traffic will not get any discount, as it comes in the below 400 km range, said sources.

The reductions will be effective from November 8 and will be valid till December 31. The move comes on the back of a reduction in iron ore export traffic loadings over long distances during the past few months.

In September, Indian Railways had seen a 33 per cent drop in loadings of iron ore for exports (against September 2007), and a 48 per cent drop in net tonne kilometre (NTKM). NTKM is a performance parameter that measures both loading and distance (lead). In August, Railways had seen 18 per cent drop in loadings of iron ore exports and 31 per cent drop in NTKM.

The discount levels are higher for longer distances and will be extended only for the incremental distance. For instance, in loadings in South Eastern Railway, Railways is extending 25 per cent discount for leads of 401-500 km, 40 per cent reduction for leads of 501-700 km and 50 per cent reduction for 701-1,100 km. So, if a customer books for his iron ore traffic for 475 km, he will enjoy a 25 per cent discount on freight charges of 75 km.

Sources in South Eastern Railway said that customers who load iron ore from Barbil, Barzamda and Barsuan for Paradip and Visakhapatnam ports will enjoy the discounts.

South Eastern Railway, the zone which loads the highest levels of iron ore, has seen a 40-50 per cent reduction in iron ore export loadings.

More Stories on : Railways | Minerals | Exports & Imports

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