The Railways may be forced to increase freight charges in October following an increase in diesel prices, indicated Adhir Ranjan Chowdhury, Minister of State for Railways.
“….As per the proposal of the Budget, it will (have to) be hiked again in October,” he said, speaking on the sidelines of a conference by industry body Assocham.
Indian Railways has linked its freight charges to fuel adjustment component (FAC), with a review mechanism set for every six months, and the FAC comes up for review in October.
On whether passenger fares will also be considered for further hike, Chowdhury said: “No, it will be freight only.”
Further, he said, due to FAC, railway fares would move “in a dynamic way”. “If the global oil price decreases then freight tariff will also decrease,” he said.
Incidentally, Railways also plans to set up a tariff regulator through an executive order.