Mini Rail Budget offers carrots for long-term freight contracts

Announces plans to move towards Aadhaar-based online ticketing

The ministry of railways is planning to promote private investment through the bidding of specific projects and forming of joint ventures with public sector undertakings. As part of an action plan termed Mini Budget, the railways on Thursday also announced turning 25 stations into 100 per cent digital stations. The Indian Railways Freight and Passenger Business Action Plan 2017-18 includes initiatives in the passenger, freight and non-fare revenue segments.

It has lined up a new long-term contract for major freight customers, which will provide assured cargo for the national carrier and also dedicated rakes for customers.

To avail of this contract, customers should offer to despatch at least one million tonnes per annum, and incremental volumes and customer-based freight revenue will get discounts ranging from 1.5 to 35 per cent.

“The plan includes 50 actionable initiatives, including the upgrade of delivery systems, introducing policy for long-term contracts with major freight customers, bringing in double stack dwarf containers and introducing the roll-on-roll-off (RORO) facility,” said Railway Minister Suresh Prabhu, addressing the media after launching the action plan. Other major initiatives in the pipeline include a policy for mobile application-based cab services, adding 6,000 point-of-sale machines and 1,000 ticket-vending machines during the year and introducing Aadhaar-based ticketing.

Reacting to the development, the stock of Titagarh Wagon rallied nearly six per cent to ~109 on the BSE, while Texmaco Rail & Engineering gained four per cent to ~93. Stone India and Kernex Microsystems advanced five per cent each to ~65 and ~43, respectively.

The action plan has been termed Mini Budget because the road map for the railways was normally presented along with the railway Budget. After the central government this year broke the 92-year-old tradition of having a separate Rail Budget, the railways opted to present its road map in a separate function. “Earlier, this used to be presented along with the Rail Budget. Though no one has asked for this, we are voluntarily presenting it,” Prabhu added.

The major initiatives in the freight segment include revamping goods sheds, introducing RORO facilities nationwide, and coming up with roadrailer facilities, 100 new freight terminals under Mission 100, long-term contracts with freight customers, rationalising weighing policy, introducing timetabled trains and procuring specialised rolling stock for sectors like automobiles.

To improve the safety of coaches, another 2,300 German-made LinkeHofmann-Busch coaches will be rolled out in 2017-18. Currently, the Indian Railways uses integral coach factory coaches, which do not have anti-climbing technology. Moreover, 17 new trains — seven Humsafar, seven Antyodaya and three Tejas — will be introduced during the year. The ministry is working on a new policy on rail tourism.

As part of its strategy to augment nonfare revenues, the railways will monetise various hard and soft assets like launching rail display networks in 408 stations and introducing out-of-home advertising, which will generate revenues of about ~6,000 crore for the national carrier in the next 10 years.

In the merged Budget presented by Union Finance Minister Arun Jaitley, the capital expenditure target for the railways for the financial year 2017-18 was set at ~1,31,000 crore, of which ~55,000 crore is to be contributed as government support. Jaitley also proposed the Rashtriya Rail Sanraksha Kosh with a safety fund worth ~1 lakh crore over five years.