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With the cash-strapped Indian Railways struggling to keep finances in order, a revision of rail freight rates is scheduled to happen in October. The railways is likely to hike the freight rates because of rising global oil and energy prices. Passenger fares are unlikely to be touched.
“In the Budget, it was proposed that due to rising diesel prices, the rail freight rates will be hiked at the end of six months period,” Adhir Ranjan Chowdhary, minister of state for Indian Railways, said at an event in New Delhi. He later said it would be a dynamic process and if the prices of energy came down globally, the rates would be reduced.
The railways will review the fuel adjustment component (FAC) for revising the freight tariffs. FAC is calculated on the basis of fuel and energy prices. The last hike in freight tariffs was seen in April this year by 5.7 per cent.
While addressing a conference on modernisation of Indian Railways, Chowdhary conceded that railways had failed to attract the private sector, unlike port and telecom.
He urged industry to lend its support.
“Industry should be a little liberal in their investment in the railways infrastructure in India as it plays an important role in growth of Indian economy.” Comparing the growth of Indian and Chinese railways, he said the Chinese experience had much to teach us.
Parliament was earlier informed by Minister of State Kotla Jay Surya Prakash Reddy that the railways was likely to incur a loss of Rs 25,000 crore this year. The losses for 2012-13 stood at Rs 24,600 crore and Rs 22,500 crore for 2011- 2012.
