CHENNAI: The Railways need to introduce mass level exclusive parcel goods trains across the country to provide fast, safe, time bound service, said a latest report by the Indian Foundation of Transport Research & Training (IFTRT).
The Railways should set up retail cargo booking and delivery outlets in collaboration with private entrepreneurs in commercial centres, markets and industrial areas in an effort to effectively compete with road transport.
"Parcel cargo booked through retail outlets and booking points should be linked to internet portal for location of cargo and its delivery to the consignors / consignees," said S P Singh, senior fellow and coordinator, IFTRT. "This will help trade and commerce to source railway parcel services at economical rates and pose direct competition to the powerful segment of goods parcel booking agents, and break their collective pricing behaviour, which is exploiting the consumers," he added. A expanding Railway with high speed freight corridors is key solution to rationalize logistic cost in India, the report said.
The Railways used to command nearly 80% freight share in 1952-52 while road transport comprised a meager 21%. In the ensuing half a century and more, it has slowly relinquished its preeminent position thus increasing India's logistic costs significantly. Currently road freight has 80% share as against rail having only 20% share. "Besides the retail parcel cargo share for road is over 95% and rail has almost 5% share," said the report.
There could be number of reasons for this reversal, but the gradual weakening of rail freight due to negligible investment on replacement and expansion of rolling stock, despite economies of scale and lower freight charges, has led to the rapid expansion of road freight/ truck transport. "The railways slackness has left the entire turf at the mercy of powerful unregulated mass of goods transport agents / transport contractors / common carriers, who on the one hand control and dictate the 85% of freight market by dictating terms with the consignors / traders and on the other hand have strong grip over the 5.6 million truck operators," said Singh.
There is a well knit network of 2.5 lakh good transport agents and common carriers in the country having almost Rs 4,00,000 crore annual turn over, which includes 1,40,000 crore of retail parcel / part load cargo. These common carriers have pricing power to dictate truck rentals and hiring charges across cities and towns. In contrast, almost 90% of truck operators own 1-5 vehicles only which offers them little elbow room or muscle, said Singh.
Railways needs high speed freight corridor to compete with road transport: IFTRT
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Railways needs high speed freight corridor to compete with road transport: IFTRT
