Sical lines up Rs 350 cr to operate cargo trains

Multi-modal logistics company South India Corporation Agencies (Sical) will invest Rs 350 crore to operate container trains over the next three years.

The company will deposit the earnest money amounting to Rs 50 crore shortly with the Indian Railways for running container trains.

The licence to operate container trains will be valid for a 20-year period and may be extended by another 10 years subject to certain performance-related conditions.

The investment decision follows the company's application to the Indian Railways seeking permission to operate container trains on an all-India basis for export-import and domestic cargo on four categories offered by the Railways.

Sical executives said the investment would go towards developing container train operations connecting the Jawaharlal Nehru Port Trust at Nhava Sheva, near Mumbai, to the company's existing inland container depot at Noida and towards developing similar operations on three other strategic routes in India.

Senior executives said the expenditure will largely go into creating facilities with railway sidings at the inland locations, container rolling stock and handling equipment.

Operations of container trains are expected to add several new product lines to Sical's existing portfolio of integrated multi-modal logistics, they said.

Besides, the new business will capture a large portion of its own 20 million tpa freight traffic that it transports with the Indian Railways.

Ashwin Muthiah, vice-chairman, Sical, said the company's presence in integrated multi-modal logistics services, which include port terminals and cargo handling, trucking, warehousing and container freight stations, and inland container depots, would get a definite boost with the addition of the container train business.