In a move that should help the Indian Railways increase its freight business as well as upgrade its infrastructure facilities, the railway ministry has now come out with a terminal development scheme for private players. The scheme would enable private companies manufacturing products such as cement, fertilisers and flyash to build their own terminals for transporting these freight items keeping in mind their specific requirements.
A Rail Bhawan official said, ?It would help us get guaranteed freight customers for at least 20 years while simultaneously relieving us of the burden of handling the freight.? The policy allows for special terminals to be built for bulk commodities which can be transported in loose quantities as well as terminals for finished products- iron and steel, bagged cement and bagged fertilisers by the manufacturer.
The terminal can be set up near the manufacturing hub either on private land or on land owned by railways. The developer will have to build the terminal at his own cost according to his specific needs and can house facilities for storage, loading, unloading and packaging of the commodity. According to initial estimates, setting up such terminals would require investments of at least Rs 40 crore each.
But as an incentive, the terminal owner will enjoy freight discounts stretching over a period of 20 years. This would translate into a freight concession of 15%, a waiver of the hefty busy season surcharge along with a waiver of the terminal surcharge for the developers of the terminals.
The railways have, however, laid out strict traffic guarantees for those who construct terminals on railway land. In the first year of operation, the developer would have to provide railways with at least 0.5 million tonne (MT) of freight. In the second year, this would rise to 0.75 MT and in subsequent years, railways would transport a minimum 1MT freight from such terminals.
Rail minister Lalu Prasad in his Budget this year announced the scheme as part of his initiative to increase railways? freight traffic. For 2008-09, railways have set a freight loading target of 850 MT. The new terminal development policy is one of the many measures his ministry is working on, to achieve the freight target.