Railways freight traffic picks up

Cement, Coal, steel marketshare up, but petroleum products see a dip

Indian Railways seems to be winning back traffic in commodities like cement, coal, fertilisers, iron and steel, where it had been losing market share. Its share of petroleum products, however, continues to decline.

The improvement in market share is reflected in the higher railway coefficient -- the proportion of traffic carried by the railways against the total production.

The latest figures show that for cement, the coefficient rose to 40.93 per cent during April-January 2004-05 against 39.63 per cent during the corresponding period in 2003-04.

For coal, the share improved to 73.42 per cent during April-January 2004-05 compared with 72.41 per cent during the 10-month period in 2003-04.

For iron ore and steel, the coefficient rose to 35.4 per cent from 34.64 per cent registered during April-January, 2003-04.

The Railways have, however, been unable to arrest the decline in their share in transporting. The share during April-January, 2005-06 has fallen to 24.77 per cent from 26.45 per cent in the corresponding period last year.

This year, the Railways have reduced their tariff for petroleum products and lubricants by 10 per cent to counter the threat of pipelines weaning away traffic in this segment.

Railway ministry officials attributed the improved performance in major commodity classes to a zero increase in freight of these commodities over the years. It was only after a gap of three years that the freight for cement and iron was hiked last year.

"This has made transportation of commodities by rail much cheaper than by road," an official said.

External factors have also contributed to the Railways being the preferred mode. They have benefited from the strict enforcement of the maximum-load norm for trucks. This has helped them bag traffic for commodities like cement that can easily be transported by road,according to officials.

The share of cement carried by the Railways is still lower than 44.93 per cent recorded in 1997-98. The share declined as industrial clusters in the country had been localised, thereby reducing the distance over which the product was being carried. Owing to this, alternative modes like roads were being used.

The increase in the share of coal from 65.89 per cent in 1997-98 is attributed to increased production, as coal generally has a captive demand in plants like power and steel. Coal, hence, was mainly carried by rail as these plants required assured supply.