APSEZ to introduce new train-handling charge at Mundra port from May 1

In a surprise move, Adani Ports and Special Economic Zone Ltd (APSEZ) said that it will introduce a new train-handling charge on all trains handled at Mundra port, the Ahmedabad-based conglomerate’s flagship port, and India’s biggest commercial port by volumes handled.

The new charge, to be applicable from May 1, has been set at “₹2.60 lakh plus GST per rake handling in/out with 48 hours”, APSEZ said in a customer advisory, adding that it is being introduced “to utilise this infrastructure at Mundra port”.

As a part of multi modal transportation, a shipping line ties up with various agencies which are necessary for taking a container from the port to the final destination. In the case of containers, the destination is not the ports but is either the container freight stations (CFSs) around the ports or the inland container depots (ICDs) in the hinterland.

Such contracts are between the intermodal operator — those who provide service by road or by rail — and the shipping lines. This involves transmission of liabilities between these parties and a contract for the purpose of switching between ocean and rail or road at the port is between the line and the port terminal operator.

The terminal operator is supposed to charge the shipping line for this which, in turn, recovers it from the customer.

“Instead, APSEZ will charge this to the rail operator,” said an industry source.

“There is also possibly an intention to create competition, because even if they charge it to their own rail operating arm — paying from one pocket to the other pocket — they can find mechanism of obviating this burden on their rail operator and this will create competitiveness amongst their own rail arm and other operators,” he said, adding that other operators will have to absorb the costs since they are unable to pass it on to their customers.

Adani Logistics Ltd, a wholly-owned unit of APSEZ, is India’s largest private rail operator.

“So, there is a problem there. It’s a per rake charge, not a per container charge and so you cannot pass it on; you don’t have mechanism of pro rata in this,” the industry source said.

For instance, if a rail operator runs a train from Mundra with 90 containers and brings back the train empty to some other terminal, then the entire ₹2.60 lakh will have to be borne by those 90 containers. But, if he runs a rake with 90 boxes and brings back 90 boxes, then the cost will be spread over 180 containers,” he stated.

If it is a double-stack train, Indian Railways will give 50 per cent discount in haulage charges on the second tier.

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