Budget 2020: Airconditioned freight for perishable food? Cost will be the critical factor

In her Budget speech, Finance Minister Nirmala Sitharaman said that to build a seamless national cold supply chain for perishables, inclusive of milk, meat and fish, the Indian Railways would set up a Kisan Rail – through PPP arrangements.

"There shall be refrigerated coaches in express and freight trains as well," she said  in her speech.

There are two problems with air-conditioned trains and air-conditioned coaches. They are expensive, both in capex and in operational terms as well.

Second, if you are talking about airconditioned trains, you need a dedicated freight corridors across the country. That is because without a dedicated corridor, freight trains are asked to move aside to let passenger trains get priority over right of way. That is why a freight train from Delhi to Mumbai can take anywhere between 7-10 days, when the journey can be covered in 18 hours.

And that is why airconditioned coaches and trains are only used for value-added products, not just plan commodity crops.

Thus to make the airconditioned coaches a feasible option, the government will first have to set up food processing facilities to value-add the agricultural produce, give it a longer shelf life, and to allow it to pay the higher freight charges applicable.

Once again the government is talking about air-conditioned freight coaches, without first getting into place food processing and value-addition units. Once again the cart before the horse.

The only player who has got his act right is Adani Logistics which has a cold chain facility on the delicated freight corridor to pick up apples, sort them, preserve them, move them from J&K and Himachal Pradesh and then send them for exports. The other is milk where the white revolution worked on short runs through trains using air-conditioned tankers. Other crops have yet to get their strategies, costings and pricing right.

That needs to be done first.