The Indian Railways has decided to enter into a tie-up with Coal India to invest in general purpose wagons. The agreement will be such that Coal India will transfer funds to the Indian Railways for wagon procurement.

The wagons will be of 25-tonne-per-axle weight and will run on certain circuits such as those connecting Paradip Port and Dhamra Port.

Coal India will have to pay full tariffs on the wagons, and the wagons will be used to transfer Coal India’s captive use only, Mohd Jamshed, Member Traffic, Indian Railways, said on the sidelines of a conference. The brake vans will be provided by the Railways.

The Railways will bear the cost of maintaining the wagons for their 30-year life, after which the wagon scrap will be sold and money earned from scrap will be paid back to Coal India, shared another official.

Railway Minister Suresh Prabhu said the initial investment of ₹500 crore will lead to anticipated investment of ₹5,000 crore.

Coal is the key commodity for railways accounting for largest share of traffic and revenues.

The MoU will lead to procurement of 2,000 high capacity wagons (33 rakes) in the first tranche, which will facilitate increased evacuation of coal from Coal India sidings. These wagons will lead to additional loading of 8-10 tonne per wagon compared with the conventional wagons of the Railways.

Initially, the rakes will be inducted and run in the two main coal loading zones of Railways — South East Central coal sector and East Coast circuit.

These rakes will be inducted in circuits to transport coal from MCL Talcher and IB area and South Eastern Coalfields Ltd to Paradip and Dharma ports, Vishakhapatnam area and the power houses of Nagpur and Raipur region.

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