The Railway Board has withdrawn its hike in demurrage charges, which are levied when the shipments or cargo is not picked up beyond the free period. The hike sought to penalise users by doubling demurrage charges between 4 pm to 12 midnight. It also sought to hike charges 3.5 times if the shift went beyond 24 hours, and to 4.5 times if it went on for 48 hours. The railways had recently hiked demurrage charges and reduced the loading and unloading time. A failure to meet the time limit would have lead to stiff penalties and an increase in overall cost.

Trade and the commodities sector specifically said they had invested heavily in modernising the loading and unloading facilities, and the demurrage charges were unfair.

Rafeeque Ahmed, President, Federation of Indian Export Organisations thanked the Railway Board for the prompt withdrawal of the hike.

He said that while the rationale behind the demurrage charges was understandable, since the majority of the cargo moved on Indian Railway rolling stocks are handled manually by unskilled labourers, and not by mechanisation, the availability of labour during late evening and night had turned out to be a big issue for the Indian Railway Goods Sheds, and at private sidings.

The FIEO chief said there were also seasonal shortages of labour, during which rakes are handled by less than required numbers. He added, container pick-ups were delayed due to traffic at Nhava Sheva, near Mumbai, and rake handling was delayed for want of containers.

All these problems would have had an adverse impact on the overhead costs of exporters had the demurrage charges been implemented, he added.

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