Railways to allow private companies to run own freight train

April 11, 2017: Indian Railways will soon allow private companies to run their own freight trains from their own private terminals. This move could potentially break the monopoly of the national transporter on the country’s railroads.

According to reports, companies from different sectors like cement, steel, auto, logistics, grains, chemicals and fertilisers have evinced interest in having their own fleet under the special freight train operations scheme of the railways. If the scheme works successfully, it could pave the way for running private passenger trains eventually. Many of the private companies, including Tata Steel, Adani Agro, Kribhco and several others, have their own private terminals.

For the current year, railways have decided to allow 55 private freight terminals in the country at an investment of Rs 5,000 crore. In FY’17, Indian Railways did a loading of 1,107 million tonnes, a record high and for the current financial year railway minister, Suresh Prabhu has set a loading target of 1,200 million tonnes.

On the existing rail network, private companies can lease rakes from Indian Railways or have their own rakes manufactured as per their specifications and run them entirely as per their convenience from their own private freight terminals. However, the train operations will still be managed by railways and companies will have to pay track and other usage charges to the national transporter.