Companies

‘Allow dedicated parcel van to be added in passenger trains’

Mamuni Das New Delhi | Updated on August 14, 2020 Published on August 14, 2020

Private train face risk of lower traffic and low revenue in post pandemic era

Potential investors aspiring to run the first bunch of private passenger trains on the Indian Railways’ network have urged the government to permit them to move cargo and parcel traffic as well by attaching a dedicated parcel van to such trains.

This flexibility will allow the train operators to increase their revenue earning capacity and will provide a much-required cushion when there is dearth of passenger traffic. The demand comes in the backdrop of India staring at the possibility of a shrinking economy in the post-pandemic era.

Indian Railways itself has seen a drop in demand from passengers as against pre-Covid times in the limited number of trains that are operational. The national transporter has suspended the normal operations of its passenger trains indefinitely due to safety concerns.

Railways have maintained that these set of trains account for only five per cent of the total train network it owns. Also, they are the most expensive routes and have been identified and operate on the most-high capacity routes.

Revenue drops significantly

As far as Indian Railways’ own trains are concerned, several of its mail and express trains have parcel vans. In June this year, revenues from passengers in reserved trains plunged to a negative zone of (minus) ₹17.42 crore against ₹2,964 crore last fiscal, according to Railways’ data. The reasons for this plunge include lesser number of trains, fear of travelling during Covid-19, and social distancing norms.

On the other hand, revenues from parcel cargo moved in passenger trains were at ₹34 crore against ₹131 crore during the same time previous year, reflecting a 74 per cent drop.

In the post pandemic era, predicting the pattern of recovery of passenger trains may be a tough task as long-distance travel may be replaced with passengers and corporates preferring telecommuting.

The draft qualification contract of the Railways has taken into account this possibility, it appears. It has stated that gross revenue of the private train operator would include just not the money earned from sale of tickets but also by carrying baggage, luggage, cargo, or parcel. However, railway sources indicate at this stage the national transporter may not yield on this demand of attaching another parcel van.

“Further flexibilities in the make of trains is desirable. Railways should simply define the average speed required instead of defining specifics,” said an industry official.

Companies that have purchased the document so far include GMR Infrastructure, CAF India Pvt Limited, IRCTC, BHEL, Alstom Transport, Bombardier Transportation, Siemens, Hind Rectifiers, Medha Engineering and Infrastructure, JKB Infrastructure, Titagarh Wagons, Gateway Rail, Jasan Infra, RK Associates and Hoteliers, PSGG Technologies, BEML, Medha, Sterlite Power, Bharat Forge, L&T Infrastructure Development Projects Ltd, ISQ Asia Infrastructure Investment PTE Limited, National Investment and Infrastructure Fund, I-Board India Pvt Limited.

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Published on August 14, 2020
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