Home | Fast Track | Pricing Policy | Commercial Policy | Face to Face | Project Reports | Tenders

generates a cash surplus before Dividend of Rs. 20,000 crore in fiscal* 2006-07 signifying an impressive Rs. 5300 crore in a year from Rs. 14,700 cr. in the previous fiscal.

"The Budget proposal would give enough encouragement for huge capacity building of steel, cement and coal sectors." - Venugopal N Dhoot, President, ASSOCHAM

“The budget truly heralds a modern approach to managing the largest public service through use of technology and innovation.” - R.Seshasayee, President, CII

*India's fiscal year begins on April 1


Northeast Eastern
North Frontier
South Central
South Eastern  
Western Railway
East Central
North Western
East Coast
South Western
North Central
West Central
South East Central
Metro Railway





Dynamic Pricing Policy

THE dynamic pricing policy for freight traffic introduced in the year 2006-07, has paid rich dividend. This has prompted the Railways to make a policy for reducing fares at varying rates, for all services of AC Ist class and AC II tier class and new design coaches for AC III tier and AC Chair Car, during peak and non-peak seasons, in popular and unpopular trains. Similarly commercial policy for freight transportation has also been made dynamic and different wharfage rates have been prescribed for busy and non-busy goods terminals.

Passenger Services

So far as passenger service is concerned, railways had introduced a reduction of Re 1 per passenger in the fares of second class in August 2005 and this reduction notwithstanding, passenger earnings grew by 14 percent. Being enthused by such encouraging response the daily ticket fares of non suburban ordinary passenger and non super fast mail-express trains has been reduced further by Re 1 per passenger. This apart, the super fast surcharge levied on second-class tickets for super fast trains are being reduced by 20 percent during fiscal 2007-08.

The Railways have designed new Sleeper class, AC Chair Car and AC 3 tier Coaches. Only these high capacity coaches will be manufactured from 2007-08.A portion of the benefits of this enhanced capacity with our customers. In the newly designed sleeper class coach there will be a general reduction in fare by 4 percent. This reduction will be applicable during both lean and peak seasons. The fares for the newly designed AC-3 tier and AC chair car coaches would be reduced by 8 percent in lean season and 4 percent in peak season. In popular trains, this reduction will be uniformly 4 percent throughout the year. Fares for AC I class will be reduced by 6 percent in the lean season and 3 percent in the peak season. The fare will be reduced uniformly throughout the year by 3 percent in popular trains.

Fares for AC-2 tier class will be reduced by 2 percent during the peak season and 4 percent during the lean season. The fares will be reduced uniformly throughout the year by 2 percent in popular trains.

High speed corridors

INDIAN Railways plans conduct pre-feasibility studies for construction of high speed passenger corridors with state of art signaling and train control systems for running high speed trains at a speed of 300 to 350 kms per hour. All the four regions will have one each of these corridors, where trains will cover distances of up to 600 kms in two to three hours. Among other public private partnership would also be considered to implement these projects.

An highly important task the railways minister is stressing on is gauge conversion. Indian railways has been losing thousands of crores of rupees annually as these narrow gauges are cut off from the main network and give less than 1 percent of freight traffic whereas they constitute 20 percent of the total network. To offset this huge financial loss, majority of metre gauge lines are planned to be converted into broad gauge lines during the 11th Plan Period begining with the next fiscal year (2007-08). Gauge conversion will facilitate integrating the remote and far-flung areas of the country with the national mainstream. Projects where State governments contribute 50 percent of the total cost would be given priority in sanction and implementation.

Capacity enhancement in the suburban services of Mumbai would be undertaken during the 11th Plan period. Alongwith completion of MUTP-Phase I work on Rs. 5000-crore MUTP-Phase II project would start during this Plan period. Expected to enhance capacity by 56 percent the project would be taken up through joint participation of Railways, state governments and multilateral funding institutions. Ongoing works on suburban services in Kolkata and Chennai will also be completed on priority basis. Air conditioned class services in suburban trains in Mumbai, Chennai and Kolkata and escalators at major stations would also be set up during this Plan Period.

Freight Business

The railways has been witnessing unprecedented growth in freight transportation, to maintain this tempo, Railways have initiated number of measures with effect from April 1, 2007. The tariff was reduced by 9 percent to reduce the classification for diesel and petrol from class 240 to 220. Taking the rationalization process further, the highest class is being reduced from 220 to 210. This will bring down the freight for diesel, petrol and ammonia etc, by about 5 percent.

On the demand of mineral based industries like steel, cement etc., freight rates for transportation of all minerals including iron ore and limestone will be charged at Class 160 in place of 170. This will reduce the freight rates for these commodities by about 6 percent.

Empty Flow Direction Freight Discount Scheme

To ensure better utilization of empty wagons in the return direction, last year Railways introduced a freight discount of 30 percent during lean season and 20 percent during peak season on incremental loading in the empty flow direction. To make this policy more effective, the empty flow discount is raised to 30 percent during the peak season also. This discount will apply to both open and covered wagons in both peak and lean season for traffic with a lead of more than 700 kms.

In empty flow direction, in addition to block rake loading, facility will be given for loading of less than trainload traffic. In open wagon rakes 20 percent discount will be given for loading 31 to 57 wagons and 10 percent discount will be given for loading 20 to 30 wagons. In covered wagon rakes 20 percent discount will be given for loading of 31 to 39 wagons and 10 percent discount will be given for loading 20 to 30 wagons. Permission to load less than 20 wagons will not be given during the peak season. However in the non-peak season from July to September, facility to load 15 to 19 wagons would be available but no discount would be given.

Currently this discount is not available on transportation of coal, coke and all types of raw material meant for steel plants. With a view point of making this discount more brad based it is proposed to extend this discount to all commodities except coal, coke and iron ore.

Two Leg Freight Discount Scheme

If trainload traffic is offered in covered wagons for both up and down directions, then, a discount of 20 percent in lean season and 15 percent in peak season would be given for traffic in both directions. This discount will not be available for commodities placed in LR-1 or lower classes.

Incremental Freight Discount Scheme for Non-peak Season

The 15 percent incremental freight discount will be available on all commodities except for all types of coal, coke, iron ore and commodities placed in class 120 or below during the lean season. The maximum distance between two unloading points will be increased from 200 to 400 kms for the immensely popular two point rake scheme during lean season.

Commodity Based Freight Policy

Requirements and expectations of customers for specific commodities are different. A commodity based tariff policy is being developed to better address the needs of our customers for major commodities transported by rail and to provide a stronger base to railway’s competitive capabilities. This new policy will be introduced on an experimental basis from 1st April through an exclusive package for cement.

Pages: Previous 12 I 3 I 4 Next