The Hindu Business Line : Concor monopoly in rail freight: Is the end in sight?

WILL the monopoly over movement of cargo containers by rail come to an end for Container Corporation of India (Concor), a subsidiary of the Indian Railways?

This question has once again begun to do the rounds in port and shipping circles in the wake of the recent reports that the Railway Ministry has permitted Pipavav Rail Corporation Ltd (PRCL) to transport containers by rail on some 10 routes from Pipavav port to all dry ports, including inland container depots (ICDs).

Even though there has been a long-standing demand by the trade for allowing private participation in container movement over rail, industry analysts are of the opinion that PRCL's entry into this segment is a prelude to the opening up of the sector to private operators.

Several private and Government organisations have indicated their willingness to enter this sector once Concor's monopoly is diluted.

Central Warehousing Corporation (CWC) will be one of the first operators to enter rail movement of containers once this happens.

"We will certainly enter this market, especially as we have the necessary wherewithal in terms of warehouses and logistic solutions," a senior CWC official told Business Line.

For a long time, a significant chunk of the port and shipping industries has been seeking private participation in container movement over rail, especially with Concor struggling to meet the surge in demand for container movement to and from the Indian ports in recent times.

Industry experts said that with the expansion in the network of dry ports (ICDs and CFSs), connectivity with the gateway ports has been constricted.

Further, with India's container traffic swelling in the recent years, the pressure on domestic rail movement of containers is being increasingly felt.

A glaring case of this squeeze on availability of containers is provided by the debilitating congestion that hit Jawaharlal Nehru Port - which handles nearly 60 per cent of India's container traffic - during the last 18 months.

For, Concor's inability to supply adequate rakes to JNPT had accentuated the congestion, which has been described as India's bigger infrastructure blockade in recent years that delivered a significant dent on India's export-import trade.

Concor handled 1.6 million TEUs of containerised cargo during the last fiscal, which was 15 per cent more than that handled in the previous fiscal.

Despite adding 540 high-speed wagons to its existing fleet last fiscal, the supply of rakes has been inadequate to meet the growth in demand, experts said.

Mr R. Srinivasan, President of Western India Shippers Association (WISA), said: "There is no gainsaying the need to strengthen rail connectivity at the major hub ports like JNPT, Chennai, Kochi, Kolkata and Tuticorin by allowing private operators to operate container trains. Many leading line operators and other transportation logistics service providers are still enthusiastic to enter into this sector."