Food Bill May Boost Freight Movement of Railways: Official

Indian Railways expects a huge movement of food grains across the country, once the UPA government’s proposed Food Security Bill is passed, a senior official said here today.

D P Pande, General Manager of South-Central Railway said the national carrier encourages private freight terminals under the PPP model to meet the future cargo handling demand from all sectors.

“As per our estimation, with Food Security Bill, there will be a major increase in the rail movement across the country. In Andhra, as a strong producer of food grains, there will be an increased movement,” Pande told reporters in a press conference.

The landmark legislation aims at giving legal right over a uniform quantity of 5 kg food grains at a fixed price of Rs 1-3 per kg via ration shops to 67 per cent of the population.

He said the cement industry in the country has made investments worth nearly Rs 30,000 crore to increase capacities which would be required for transportation.

According to him, the major constraint for Railways is terminals. Freight handling terminals have to be increased proportionate to tonnage.

“That is why we promulgated private freight terminal policy. Anybody, who can set up a terminal in a private property, we will provide the authority to handle goods and he can charge the customers,” Pande explained.

The Ministry of Railways, in 2010, had finalised policy on Private Freight Terminal (PFT) with the participation of the private sector.

The main objectives of this policy are to enable rapid development of network for freight terminals with private investment to integrate rail transport with supply chain to provide efficient and cost effective logistic to end users.

It would also provide a new business opportunity to the investor who gets rail access to handle third party cargo. This policy has become effective from 31st May, 2010.

Pande said South Central Railway aims to garner Rs 11,700 crore revenue in the current fiscal as against Rs 10,036 crore last year.

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Private freight terminal at Timmapur likely

South Central Railway (SCR) will now introduce private freight terminals (PFTs), a move aimed at improving its participation in the overall transport chain. This rail division, which currently holds the fourth position in freight movement among 16 divisions in the country, hopes to improve its freight figures with this private partnership terminal model.

The SCR has recorded a 13.3 per cent growth in its freight earnings in the April-June period in 2011 compared to its earnings for the corresponding period last year. For the same period, SCR’s freight earnings stood at Rs 1,347 crores, out of its total revenue collection of Rs 1,916 crores. As a whole, the freight earnings constitute approximately 70 per cent of total SCR’s earnings.

Officials on Tuesday said that the first such private terminal at Timmapur is nearing completion and that it would work as a model to attract private investments to such terminals. A second such proposal is also in the pipeline at Nagolepally, officials said. “We have traditionally allowed private players to only handle their own traffic but here they would also be able to handle third party cargo and even collect user charges,” said an official. The revenue generated from PFTs would be shared between SCR and the private player.

“We are opening up huge business potential for the industry, and for railways, it would mean great growth prospects and penetration of freight services,” said Sunil K Agarwal, chief operations manager, South Central Railways, adding that the end customer would also be benefited with novel aspects like door delivery of goods, quality packaging and so on.

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