PPP model proposed for warehouses
Railway Minister Suresh Prabhu has presented the expenditure for railway freight sector in the budget 2016-17. The highlights include investment in new freight corridor, logistics parks and warehouses to be created on PPP model and first rail-auto logistics hub in Chennai signals the focus on sound infrastructure. “To capture the automobile traffic, we will soon inaugurate India’s first rail-auto hub in Chennai,” Prabhu informed the Parliament while presenting the Railway Budget 2016-17. According to the minister, inadequacy of warehousing and transportation facilities is one of main reasons that keep potential customers away from the railways. “In order to complete the chain of transportation, it is proposed to develop rail-side logistics parks and warehousing,” the minister said.
A first ever rail auto-hub will come up in Chennai, while freight corridors will come in North-South connecting Delhi to Chennai, East-West will connect Kharagpur to Mumbai and East Coast connecting Kharagpur to Vijayawada. The proposed investment plan in the Rail Budget 2016-17 includes ‘time-tabled’ freight container services, a first for the department, parcel and special commodity trains. As per the Budget, Railways will rationalise freight rates so as to make it more competitive as compared to the road sector.
“Overall, the budget appears to be in line with the government’s agenda of long term capacity building. The effectiveness of this budget on performance and financials of railways will be the outcome of diligent execution of stated plans. The setting up of Rail University and increase in track capacity target are good moves. Expansion of DFC and Northeast network expansion plans are encouraging. Chennai Auto hub is an exciting initiative.
Allocation of funds for innovations and use of drones for project monitoring will have a positive impact. More needs to be known about comprehensive freight study. That clearly needs to be the focus for railways.”
Vineet Agarwal, Managing Director, TCI Group
“Delivery capabilities of logistics players are set to improve with announcements like Transport Development Corporation and multi-modal depots. We are also pleased to know that the ministry has put together a proposed investment plan that will include crucial areas like network expansion, high speed rail, elevated corridor, station redevelopment and logistics park. The announcement of logistics and warehouse parks to be created on PPP mode is also a step in the right direction.
The proposal of building dedicated freight corridors to boost North-South, East-West connectivity will also prove very useful. We are keen to see the pilot that would be running around the time-table freight container train.
Commissioning dedicated freight corridors are the need of the hour and we hope that this announcement would be executed well. Connectivity of airports with railways would give a boost to the perishable goods sector and this would encourage the use of multimodal transportation.”
“It is a forward looking growth oriented budget. Monetising land on tracks by leasing out for horticulture and tea plantations is a positive development as this will provide optimum usage of the properties. Secondly, the broad-gauge that will connect Lumding-Silchar section connecting Barak Valley with the rest of the country will help the logistics industry and is a welcome move.
As Lumding-Silchar connectivity has always been a critical point of North-East, this development will definitely bring in easy access to the North East section. Logistics and warehouse parks to be created on PPP mode are also a beneficiary side for the logistics industry depending on how the logistics and parks will be created.”