It has also attempted rationalisation of freight structure by lowering the highest classification from 250 to 300.
An incentive scheme has been announced for premier customers, who give more than Rs 25 crore business per annum and have their own sidings. Under the scheme, 2 per cent rebate would be granted on every Rs 5 crore net additional freight earnings. This rebate will be allowed in addition to other concessions.
Competition from roads for short distances has been tackled by giving graded concessions in rates. A 50 per cent concession has been offered for traffic up to 50 km, 25 per cent between 51-75 km and 10 per cent rebate for goods moving between 76-90 km.
Increase in earnings from freight traffic is expected to come from a higher tonnage of coal even though the ministry has projected a lower tonnage of petroleum, oil and lubricants (POL) to 33 MT from 34.50 MT during 2002-03.
Earnings from POL are expected to decline to Rs 2,436 crore from Rs 2,677.93 crore during the fiscal 2002-03.
Coal tonnage is expected to increase to 242 MT from 235 MT during 2002-03, with earnings accordingly increasing to Rs 11,840 crore from Rs 11,440 crore during the current fiscal.
A higher tonnage of coal is expected to come from an increase in its demand from steel plants, thermal power houses and other public users.
Transport of coal used for steel plants is targeted to increase to 32 MT during 2003-04 from 30 MT in the present fiscal while that for thermal power houses is expected to go up to 174 MT from 169 MT.
Iron ore for exports will earn the sector Rs 662.57 crore compared to Rs 587.90 crore in the present fiscal from an increased tonnage to 17.50 MT from 15.50 MT in the current fiscal.
An up to 64 per cent reduction has been announced in parcel rates. Major beneficiaries will be apples and cherry growers, garments, electrical and leather goods.
The movement of parcels would now be lot more cheaper even in Rajdhani Express as the rate for luggage would now be 30 per cent lower at Rs 329 per quintal for the year 2003-04 down from Rs 470 a quintal between Delhi and Mumbai.