Indian Railways serves as the backbone of the logistics sector of India, by carrying more than 1.2 Billon tonnes of freight each year across a network of 68000 km. Indian railways has successfully increased 34% automobile freight in the financial year 2022 (2021-2022). The Ministry of Railways has stated that automobiles of a total of 3.35 million tonnes (mt) have been ferried by the national transporter in the year 2021-2022. As per the data released by the railways ministry, this is the highest ever annual freight loading as an increment recorded by the Indian Railways in 2021-2022. The recorded freight was around 1278.8 mt, which witnessed a growth of 176.2 mt compared to the same period of the last fiscal year.
An official has also said that the railways have already crossed their set target of 1250 mt of freight loading for this year, and now the department is looking forward to crossing 1400 mt of freight for the complete fiscal year 2022. As there has been a suppressed demand in the economy, the railways have reverted to it with wagon supply and monitoring processes that are efficient.
The automobiles report for a very small portion of the total freight number of the railways because of the weight factor. They are not as heavy as the other items with big tickets that help to make the freight basket of railways, said another official. The Indian railways has always been a major part of the transportation and freight system as it has been transforming its freight basket over time through various processes, due to the potential automobiles bring with them as a space to hit. With an aim to attract more interest from several automobile companies and expand the sector, the railways had modified its automobile freight train operator (AFTO) policy in the year 2018.
Indian Railways serves as the backbone of the logistics sector of India.
After the modification in the policy, the registration fee for automobile freight train operator was considerably reduced to Rs. 3 crore, which is approximately 40%. Alongside, there were also relaxations given under the minimum procurement policy. While the automobile freight is quite minimal as compared to the overall volume of rail freight, there are many automobile manufacturers which are likely to increase the shareholding in the transportation of cars for the Indian Railways. Although the volume is small, the railways play a crucial role in timely transportation.
One of the giant carmakers, Maruti Suzuki has previously stated that the company has aims to transport its cars through the railways by the year 2030. The carmaker is likely to make an effort to reduce the carbon emissions that are incurred due to road transportation and huge car units that carry the manufactured automobiles from place to place. This will also reduce the duration of the deliveries and transportation and give more relevance to the Indian Railways which are highly used to deliver other freight manufacturing as well.
Other car-making companies have also started using railways to transport their cars such as Kia, and Mahindra & Mahindra.