Fuel bill of Railways to increase by Rs 560 cr

In addition, truck rentals are expected to be hiked by around by 5  per cent soon. Private taxis and commercial passenger vehicles are also expected to follow suit.

Currently, the Railways expenditure on account of fuel stands at an average Rs 8,000 crore annualy. This constitutes over 15 per cent of its total working expenses. Railways, which operates a 63,000 route kilometre (rkm) network, consumes around 2270 million litres of diesel every year.

A senior Rail Bhavan official said: "Though the hike in the prices of diesel will put an additional burden of Rs 560 crore, the Indian Railways does not have any proposal to increase the freight or passenger rates and pass it on to the common man. We are trying to increase our productivity and efficiency which will compensate for the increased expenditure on diesel".

Increasing electrification (the Railways says that as on date nearly 18145 rkm of the 63000 rkm have been electrified) is also expected to save around Rs 150 crore annually, officials added.

However, the hike in the prices of diesel will have an impact on the other modes of transport. The truck rentals are expected to surge higher by 5  percent on account of the price rise. The rentals of a 16 ton truck for New Delhi - Mumbai - New Delhi is expected to go higher by Rs 2000 to Rs 40,700.

S P Singh, senior fellow, Indian Foundation of Transport Research and Training, said, "A hike of Rs 3 per litre should actually effect an increase of 5 per cent in truck rentals. However, in the immediate future the truck rentals may increase only 3 percent as the growth in the cargo is lacking pace with the growth in the number of trucks".

However, the shipping sector does not see any impact on account of the price hike. S Hajara, chairman, Shipping Corporation of India, said, "Shipping freight rates are largely impacted due to global factors than the local issues. Most of the ships do their bunkering abroad and a domestic fuel price hike may not have any major impact on the shipping freight rates. There is no co-relation between domestic fuel price hike and freight rate hike and it all depends on the demand supply factor".