Indian Railways to auction dedicated freight corridors to private players: Report

Representative Image

Indian Railways (IR) is planning to run private freight trains along dedicated corridors. This comes as the Railways is geared up for private passenger trains, a process which was delayed due to the coronavirus pandemic.

Encouraged by the enthusiastic response to private passenger trains, the Railways is looking at private freight trains as well. For this, it is fast-tracking auctioning of routes in under-completion dedicated freight corridors (DFCs) to private players, as per a report by The Economic Times.

The aim is to begin privatising freight trains when the first batch of private passenger trains begin operation in 2023. Currently, among freight trains, only private container trains have been allowed to operate in India in limited capacity since 2006.

Private freight trains are likely to be “packaged as an added attraction”, once private passenger trains are already underway, giving early movers the advantage on grabbing lucrative routes, the report said.

Confirming the development, Railway Board Chairman VK Yadav said as per the report that private operators will be brought in once DFCs are ready. Deadline for completion of DFCs is June 2022.

“A railway regulator will be created before the rollout of private passenger trains in 2023… private freight operators will invest in wagons and containers. So, the regulator will have two mandates — regulating passenger trains and freight trains,” Yadav added.

On the routes likely to be auctioned to private players, Anurag Sachan, Managing Director, DFC Corporation of India (DFCCIL) said they would engage first in the 650 km stretch between Palanpur (Gujarat) and Rewari (Haryana). This stretch will be operational this fiscal, he added.

The Railways is spending Rs 80,000 crore to build two corridors – eastern and western and has plans to monetise their assets to “the highest level to repay loans and receive some revenue,” Sachan added.

The bidding process for private freight trains is expected to be much simpler than that for private passenger trains. “Private players will share their revenue with us. They will be allowed to run wagons or containers. So, what kind of trains they run and what rates they charge will be determined by the operators. The rates, after all, will be driven by the market,” he said.