The Hindu Business Line : Railways sees marginal dip in Oct freight loadings

One of the positive fallouts of the reduction in rail freight loadings has been the curbing of the black market in rake bookings, reliable Railway sources told Business Line.

About 66 per cent of Railways’ freight traffic consists of coal, petroleum oil and lubricants (POL), food grains and fertiliser. This left enough scope for persons with cash surpluses to book wagons for forward sale — particularly in commodities such as iron ore — leading to a sudden spike in loadings and thus demand for more rake capacity in the past few years.

Wagon capacity

“Till about a few months ago, there was a shortage of wagon capacity. People with cash surplus used to book rakes in advance – well assured that they could further sell the rake capacity – to smaller iron ore exporters who did not have their own sidings,” said sources in the Railway Ministry. These “benami bookings” have now significantly reduced, said sources. There has been about 40 per cent reduction in wagon loadings for iron ore exports in October.

The Railways recorded a marginal dip in freight loadings in October 2008 with 66.08 million tonnes (mt) of cargo against 66.17 mt in October 2007. The reduction was primarily on account of drop in iron ore traffic, and no significant growth in cement and steel loadings, said official sources.

However, Railway officials appear unperturbed. “The demand from coal (which accounts for 42-43 per cent of rail freight business), POL and higher demand for fertiliser loading is likely to negate the slowdown in demand from other commodities such as iron ore, cement and steel,” said a Ministry official.

Despite the marginal dip in loadings, the October freight earnings of the Indian Railways continued reflecting a five per cent growth with Railways clocking Rs 4,103.73 crore. This was due to increase in freight charges of several commodities during the last one year.

During the April-October 2008 period, Railways carried 467.97 mt of revenue earning freight traffic, showing an increase of 7.23 per cent over the freight traffic of 436.42 mt actually carried during the corresponding period last year, informed a release.

The total approximate earnings of the Indian Railways on originating basis in April–October were Rs 44,547.52 crore compared to Rs 38,481.83 crore during the same period last year, registering an increase of 15.76 per cent, said an official release.

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Railways sees marginal dip in Oct freight loadings