Railways to flag off round trip-based rate scheme for short-haul container movements from Sept. 15

The Railway Ministry will flag off a round trip-based rate scheme for ultra-short lead (up to 50 km ) container traffic - both export/import and domestic- from September 15 in a bid to wean away this segment from roads.

The Railway Ministry has decided to levy round-trip haulage charges for a loaded 20- foot container (TEU) for up to 50 km by billing such to and fro movements at rates applicable for a single trip in the next slab – 51 to 100 km - effectively translating into a discount of 35 per cent, a ministry official said.

Currently, container traffic moves in five weight slabs – 0-10 tonnes, 10-20 tonnes, 20-26 tonnes, 26-31 tonnes, 31 tonnes and above - at haulage charges set by the Ministry depending on the distance.

The haulage charge for a single trip 26-31 tonnes container for up to 50 km is ₹ 2,340 and an up and down trip would cost ₹ 4,680 per container. The single trip haulage charge for a 26-31 tonnes weight slab container for 51 to 100 km is ₹ 3,038 – a difference of ₹ 698 (single trip) for the additional 50 km.

“What we have done is instead of charging a customer the slab of 1-50 km up and 1-50 km down, which would have made it ₹ 4,680, we are saying we will take it as up to 100 km and charge ₹3,038. That means, instead of charging ₹ 4,680 up and down, he is charged ₹ 3,038 for up to 50 km round trip. So, instead of paying the 50 km slab up and down, customers will be levied haulage charges on a single trip 51-100 km slab which is a 35 per cent discount,” the ministry official said.

A ministry survey revealed that the 20-26 tonnes and the 26-31 tonnes weight slabs accounted for 80 per cent of the container traffic in this segment. For the round trip, Railways will collect haulage charges on all the 90 TEUs – one train or rake is 90 TEUs - at the rate applicable for the 26-31 tonnes slab, irrespective of whether it is laden or empty.

“Whether you load less than 90 containers, load more than 31 tonnes, load less than 26 tonnes or load empty containers, the haulage charges will be pegged to the 26-31 tonnes slab,” he explained.

The new scheme will benefit container ports evacuate boxes by rail to the nearest container freight stations (CFS) that are located less than 50 km away for onward movement to inland container depots (ICDs) located in the hinterland and vice versa.

Customers had told the Ministry that they were keen to shift to rail for short-distance movement of containers due to bad road conditions but felt that the haulage charge for the 1-50 km movement was “very expensive”.

“The round-trip haulage rate for the 1-50 km will now be ₹3,038 per container. What we will actually do is, in the first trip, we will levy the original charge applicable for the 1-50 km, which is ₹ 2,340. On the return trip, he will pay ₹ 698, the difference between ₹ 3,038 and ₹ 2,430. The round trip has to be completed in 72 hours,” the ministry official said.

The new scheme will run from September 15 to September 14, 2020, according to a circular issued by the Railway Ministry.

“We are trying to capture container traffic in the ultra-short lead segment which otherwise is mostly going by road,” the ministry official said.

“We have been told that it is a very competitive, price-sensitive segment and customers have promised us a very large volume of containers by rail if rebates were given,” he said.

Roads have a number of issues hampering the faster movement of container traffic and so in one go they can move 90 TEUs up and down which will also make containers move faster and make it available faster to customers. “Wherever there is 1-50 km distance option, customers can avail of this scheme,” he added.