The railways have projected a growth in freight traffic of only about 2.5 per cent for the fiscal year 2002-03, putting the actual growth in freight traffic at about 515 million tonne from the projected 500 million tonne budget estimate for the current fiscal.
This is far lower than the growth rate targeted for the current year at 11 per cent and indicates that the department will not be able to touch freight fares at all in the budget on February 26.
For the current year the railways had projected a growth of 50 million tonne from last years level of 450 million tonne. But the ministry feels that the projected rise for 2002-03 is reasonable as the actual achievement on freight front will be barely 490 million tonne in the year 2001-02.
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From the revised estimate therefore, the growth works out to a little less than five per cent. But this is still substantially lower than the annual growth in freight traffic that was envisaged for the Ninth Plan.
According to the ministry the low growth in freight traffic is not expected to be reversed in the next couple of years also.
The railway projection means that the ministry is firmly abandoning the high growth path that the Rakesh Mohan committee had suggested.
It had recommended pursuing at least a five per cent growth in freight traffic in the core competence of railways including coal, iron ore, fertilisers, and food grains.
In their projections the railways have said that "the lower growth rates have been envisaged since the projections of freight traffic from the core ministries are kept at a modest level."
The railways feel that unless there is a trunaround in the economy there is little prospect of demand for bulk commodities touching a high in the near future.
The poor freight projection has also put a doubt on the level of internal generation of resources that the nation's largest infrastructure provider will be able to make.
For the ensuing fiscal the railways have budgeted a Rs 630 crore of internal generation of resources which is just 8 per cent more than the current year's level.