Penna Cement Industries signed a Long Term Tariff Contract (LTTC) with the South Central Railway (SCR) to transport freight at fixed rate. The term is for five years. The scheme gives long term stability and certainty in the freight tariff rates to corporate freight customers of Indian Railways.
Once a customer enters into this LTTC contract with Railways, the rate will remain fixed for one year. This gives predictability and stability in freight rates and help the customers to plan their logistics for that year.
The scheme gives incentives in the form of discounts, if the customer exceeds the previous year’s freight contribution. It is a growth-linked incentive wherein, higher the freight contribution over the preceding year, higher the discount eligible for customers, explained N Madhusudhana Rao, Principal Chief Operating Manager, SCR.
Gajanan Mallya, General Manager, SCR said that it would be more beneficial to corporate customers to enter into such agreement to avail the concession as well as fixed tariff rate for the goods being transported by Rail.