Railways may shift to 'single-rate per container' policy to lure FMCG

With an eye on high-value freight like computer parts, engineering spares, electronic and FMCG, the Indian railways plans to shift to a 'single rate per container regime'

The Indian Railways is contemplating a radical change in its tariff policy in order to attract and encourage transport of unconventional cargo, the Economic Times reported.

If the proposal under consideration is approved by the Railways then, a 40-tonne milk truck can cover a 640-km distance from Palanpur (Gujarat) to Rewari (Haryana) for up to Rs 22,000 across the Dedicated Freight Corridor (DFC) network. This will cost less than the usual Rs 29,000 one-way trip for this service. 

"Milk suppliers, including Amul and Banas Dairy, that are interested in meeting this demand from these northern regions can avail the service," the report said quoting a government official.

In the existing regime, the Indian railways charges commodity-wise rates based on classification of goods. Currently, coal, iron and other goods that are frequently transported using the rail network are present in this list. With an eye on high-value freight like computer parts, engineering spares, electronic and fast-moving consumer goods (FMCG), the Indian railways plans to shift to 'a single rate per container regime' for goods not there on the current list, the report said.

The intended shift wants the focus to be on volumes rather than what goods are being transported, the ET report said sighting a senior government official. 

DFC that facilitates cargo movements has been pushing for this shift. For railways, DFC falls under zonal railways, and thus railway board fixes freight tariffs for them.

The Railway Board had permitted DFC to offer discounts for increasing business opportunities, in August 2022.

As the country battled with severe Covid-19 waves, this principle actually helped operationalise the roll-on, roll-off (RORO) trucks on train service extensively for transporting oxygen containers to hospitals.