Lalu rules out hike in fare, freight rates

The railway ministry has decided that it will not increase freight charges or passenger fares despite the recent hike in fuel prices.

At the same time, ministry sources have indicated that the railways may use the price hike as an opportunity to grab market share from truckers by offering special rebate schemes to freight transporters.

Addressing a press conference here today, Railway Minister Lalu Prasad said there were no plans to increase fares. This is despite the fact that the additional burden on the railways would amount to as much as Rs 450 crore on account of the hike.

"Fuel prices have been increased earlier too. But we did not increase our fares. This time also we will not charge anything extra on freight or passenger trains," Prasad said.

Officials indicated they planned to start special schemes announced during the Budget. These include benefits to cargo transporters who will provide incremental freight on trains that return empty.

The ministry's assessment is that as many as 40 out of every 100 freight trains return empty. Prasad has announced that for distances beyond 700 km the discount will be 30 per cent during non-peak season and 20 per cent during the peak season.

Another scheme "" loyalty discount scheme "" is intended to encourage transportation of cement, iron and steel by rail. Under the scheme for the non-peak season, if over 90 per cent of the production of any steel or cement factory is transported by rail, a discount of 1 per cent will be given.

Another scheme will empower zonal railways to offer to transporters, who are willing to load additional cargo on wagons that return empty, a discount between 20 and 30 per cent.