‘Rail­ways should work on ca­pac­ity & in­vest­ment’

“There is a need to invest in de­vel­op­ment of in­fra­struc­ture as­sets and net­work con­nect­ing the man­u­fac­tur­ing and trad­ing cargo hubs. In­dian Rail­ways has been un­fair to this sec­tor,” says Sachin Bhanushali, Chief Ex­ec­u­tive Of­fi­cer, Gate­wayRail in con­ver­sati

Cargo Talk - - FRONT PAGE -

The haulage charge has been in­creased nine times since dereg­u­la­tion in 2006 re­sult­ing into 50-122 per­cent in­crease The suc­cess of the rail freight sec­tor will de­pend on con­sis­tent pol­icy en­vi­ron­ment to be cre­ated by In­dian Rail­ways. This will help in­dian econ­omy to un­lock the huge po­ten­tial of this sec­tor

First of all, con­grat­u­la­tions for tak­ing over as the CEO, Gate­wayRail. As the new CEO, what would be your prime fo­cus to strengthen the ser­vices and business of Gate­way Rail in In­dia?

Thank you for your good wishes. Gate­wayRail has been able to demon­strate that by steady and care­ful in­vest­ment in cargo ter­mi­nals at strate­gic lo­ca­tions and by pro­vid­ing con­sis­tent ser­vices, it is pos­si­ble to build business even in a fiercely com­pet­i­tive en­vi­ron­ment.

The company will con­tinue to fo­cus on ‘cus­tomer ori­ented’ and ‘re­li­able’ lo­gis­tics ser­vice to its cus­tomers. We would be keen to grow in the do­mes­tic trade if In­dian Rail­ways can cre­ate con­ducive en­vi­ron­ment for this pur­pose.

What would be your rec­om­men­da­tions for the greater in­ter­est of the lo­gis­tics in­dus­try and the coun­try’s econ­omy as a whole?

In­dia has to invest in de­vel­op­ment of in­fra­struc­ture as­sets and net­work con­nect­ing the man­u­fac­tur­ing and trad­ing cargo hubs. Al­liances amongst op­er­a­tors will also be able to bring in huge ef­fi­cien­cies in the lo­gis­tics sec­tor which at present is frag­mented and fiercely com­pet­i­tive.

Steep hike in haulage charges of 25 – 41 per cent, plus con­ges­tion sur­charge of 10 per cent for rail traf­fic orig­i­nat­ing at all ports have been an­nounced. How does it af­fect your cost to cus­tomers?

Rail haulage charges con­sti­tute 75 to 80 per cent of our op­er­at­ing costs. The sec­tor (both op­er­a­tors and cus­tomers) can­not take an in­crease of 25 to 41 per cent in its cost. In­dian Rail­ways has been un­fair to this sec­tor. The haulage charges have been in­creased nine times since dereg­u­la­tion in 2006 re­sult­ing into 50 per cent to 122 per cent in­crease in the haulage charges vis-à-vis five in­creases in rail­way freight re­sult­ing into 48 per cent cu­mu­la­tive in­crease.

The heavy weight cat­e­gories have be­come dis­pro­por­tion­ately more ex­pen­sive re­sult­ing into very high trans­ac­tion cost to the ul­ti­mate cus­tomer. This is likely to have two im­pacts. Firstly, some business many shift from In­land Con­tainer De­pots (ICD) to port side Con­tainer Freight Sta­tions (CFS) and some busi­nesses will be­come un­com­pet­i­tive in the fiercely com­pet­i­tive in­ter­na­tional mar­ket.

This is­sue needs to be ad­dressed and cor­rected by In­dian Rail­ways on top pri­or­ity. A par­tial and tem­po­rary roll back an­nounced by In­dian Rail­ways will not help ad­dress the core is­sue.

What kind of changes can the users of Gate­wayRail in In­dia ex­pect from the new CEO in the days to come?

I have been as­so­ci­ated with Gate­way Rail en­ter­prise as its Founder Pres­i­dent, right since the in­cep­tion of the idea. We follow col­lec­tive con­sen­sus in all our decision mak­ing pro­cesses un­der the guid- ance of the Board, par­tic­u­larly the Man­ag­ing Di­rec­tor. I am sure that the Gate­wayRail team will de­liver the promised con­sis­tent and re­li­able ser­vice to its cus­tomers as well as grow its foot­print and mar­ket share.

How do you see 2015 shap­ing up for the rail freight sec­tor?

In­dian Rail­ways need to ad­dress two is­sues as top pri­or­ity; ca­pac­ity (both net­work and rolling stock) and at­tract pri­vate in­vest­ment through For­eign Di­rect In­vest­ment (FDI) and Pub­lic Pri­vate Part­ner­ship (PPP) by demon­strat­ing in­vestor friendly de­meanor. The suc­cess of the rail freight sec­tor will also de­pend on con­sis­tent and rea­son­able pol­icy en­vi­ron­ment to be cre­ated by In­dian Rail­ways. This will help In­dian econ­omy to un­lock the huge po­ten­tial of this sec­tor.

Sachin Bhanushali

CEO, Gate­wayRail

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