Pvt container players may get to fix own rates

GIVING WINGS TO TRANSPORT INITIATIVES

The agreement is expected to be ready within a fortnight.

Operators of private container trains will get to fix their own freight rates, according to the model concession agreement being finalised by the railway ministry. The agreement is expected to be ready within a fortnight.

"As long as the private container companies pay haulage charges to the railways, they are free to fix their freight rates. We will not interfere in any manner. The market will fully dictate freight charges," a senior official told Business Standard.

The railways have also decided to allow more companies to enter the private container service market. "Every year we will keep the window open for one month," an official said.

The draft of the model concessional agreement is being prepared by RITES. Officials said the railways were also considering allowing private companies to run wagon leasing operations under the proposed leasing policy, which is expected to be finalised within the next few months. Under it, private companies will be allowed to lease wagons to container operators.

"Container operators will be able to rationalise their cost of operations if they have the choice of leasing wagons as they would not have to invest in the wagons themselves," the officials said.

"If the container train service providers were to invest in leasing more rakes, there would be more capacity augmentation. A private container service company which plans to run one train a day with a turnaround time of five days will need five rakes (a set of 45 wagons) with each rake costing about Rs 10 crore and therefore would need to invest Rs 50 crore if it had to purchase its own rakes," he added.

So far 14 companies, including Gateway District Park Ltd, Reliance Infrastructure Leasing, Adani Logistics, Concor and Indian Infrastructure and Leasing, who had applied for a licence to operate container train services, have been given the green signal.

"If they want to start operations the day after signing the agreement, they are free to do so," he added.