“…in commercial point of view, the chief object is to provide the means of conveyance from the interior to the nearest shipping ports, of the rich and varied productions of the country and to transmit back manufactured goods of Great Britain, salt etc in exchange”
-R.M Stephenson, on Indian Railways. (Calcutta, 1843).
It is evident that the intention behind introduction of railways in India was to cater to the needs of the British industry by facilitating supply of cheap raw materials; and to open up the colonial markets for consumption of finished goods; the railways were to be used as a tool for consolidating the British Empire. In short, freight from commercial activities and military requirements prompted the British to invest in railways in India.
Into the sixth decade of independence from whatever colonialism stood for, the performance of Indian railways has been indeed praiseworthy. A government railway system operating in a free economy with social objectives gaining precedence over commercial objectives, the ability of Indian Railways to be among the top five in the world in terms of passenger and freight traffic is marvellous.
Today, the railways are playing different roles in different parts of the world. France, Germany and Britain have sophisticated railways with the prime objective of providing quality services in both passenger and freight movement. USA, Canada and Brazil, due to the long distances involved and unequal distribution of population, attach more importance to freight traffic. In Japan and the Nether-lands, characterised by high density of population, super fast and sophisticated trains ply frequently between metropolitan cities at high speed on dedicated corridors whereas freight trains ply in the night on the available traditional tracks only. However, for planned economies like India, China and Russia, railways should perform the traditional role of carrying both passengers and goods. Thus, greater emphasis is placed on maximum exploitation of the assets.
In post-independence India, railways have been the lifeline. The British doctrine of divide-and-rule led to India becoming a divided house. At the time the British exited, India was a divided house - in terms of class, race, religion, resource availability, development, princely kingdoms and what not; but it was united in political spirit. The railways consolidated this spirit by integrating the country. The railways have been immensely popular with the masses; they facilitated mobility of labour to new centres of activity. As commercial activity and industrial growth picked up so did railway terminals. Numerous jobs were created in sectors like trade, commerce, transport, storage and communication courtesy these terminals. It increased urbanization and homogenized development along the railway tracks in the county. This proves the relevance of passenger traffic to India and the role of railways.
However the passenger traffic segment has been neither profitable nor self-sustaining; it is sustained only through cross-subsidization by earnings from freight traffic. Owing to certain social, economic and political compulsions, passenger fare cannot be raised to the required levels. Again the losses incurred by the passenger segment have not restrained railways from continuously upgrad-ing travel comfort. The railways have come a long way since 1860 - the (fourth) coolie class where passengers squatted on the floor and were locked from out-side like cattle and the third class where passengers carried their own candle for lighting, to the present-day luxurious travel ambience, comparable to any developed nation. Keeping the passenger fare unchanged and yet registering a revenue surplus year after year and paying dividend to the exchequer for the capital invested are creditable achievements indeed on the part of the railways. But the question is one of long term-sustainability of this arrangement.
Considering the financials for the period April - October 2005 as the basis, earnings from passenger segment was Rs 8,876.87 crores compared to Rs 8,152.22 in the previous year, a variation of 8.89%. In the goods segment, the corresponding figures were Rs 19,861.93 crores and Rs 16,929.60, with a variation of 17.32%. Of the total earnings of Rs 29,933.68 crores, passenger fare accounted for nearly 30% and freight accounted for 66%. The railways continue to be the beast of burden for transport of bulk commodities like coal, iron ore, cement, mineral oils, food grains, etc. The underlying strategy has been to recover not only the cost of transporting these major commodities but also a suitable percentage of profit so as to subsidize passenger traffic and generate a surplus for the railways. To cover the cost of running the railway system and ensure generation of a surplus, it is necessary to raise freight by 6% to 10% every year. Thus there is no getting away from the fact that a sustained increase in freight is inevitable year after year. Compulsions may temporarily freeze this increase but again the gap would have to be bridged in the subsequent years!
But what are the long-term implications of this strategy? Railways have with-stood competition from road transport so far but the onslaught will be tremendous in the future with the dedication of the Golden Quadrilateral and the North-South-East-West road corridor to the nation. With such connectivity, the freight levied by road-haulers for bulk commodities will go down. Fear of diversion of freight to road transport which is again costly to the national economy in the long run will prevent the railways from raising freight. Increase, if any, will be only marginal and will be inadequate to meet the cost involved in moving goods, subsidising passenger services and improving the quality of ser-vices.
The remedy lies in investing further to create additional capacity leading to in-creased freight traffic. With the world shrinking, the railways need to improve in terms of tonnage, net ton-kilometres, line capacity and locomotive capacity. The railways carry about 600 million tons of freight and have registered a 17% growth in freight, in recent times. This will ensure that the railways remain the carrier of bulk commodities in future too. So it is imperative that the railways create some idle capacity in the freight sector so it is not caught napping in future. After all, the freight sector is its cash cow.
The average speed of a goods train was 17.4 Kmph in 1950-51 and this has in-creased to 22.7 Kmph in 1989-90. In the fast-moving present-day world, this speed or the rate of growth in speed is very low. In a predominantly agricultural economy like India, perishable goods account for a big chunk of the freight. Hence, a speed of at least 100 Kmph is needed. Again, gone are the days when India was represented by Delhi, Bombay, Madras and Calcutta; with more industries coming up in different parts of the country, the long hauls have shrunk, reducing the average lead of freight traffic, i.e, net tonne kilometres handled. To derive profit from short hauls, an efficient highway of freight traffic is required. The extensive haulage of freight that obtains presently should be confined to a core, dedicated freight track; a distribution network will tone up the marketing of and service provided by the freight sector. By establishing a dedicated freight corridor, better efficiency can be achieved. Intensive monitoring for timely delivery, increase in trailing load of trains, claim-free movement of goods, improved services such as refrigerated containers for perishable goods, etc, can be achieved.
Use of multi-purpose wagons for freight in this corridor could reduce the present-day empty haulages from destinations to the loading points. There would also be considerable economy in working operations; increased train load movement in the corridor would offset the losses the railways incur in the haulage of certain commodities like food grains, salt, fodder, etc. The same logic would lead to economy in transport of smalls and certain parcel loads if they were to be clubbed with wagon loads in the corridor. With high-powered fast locomotives plying in the freight corridor and handling of goods for loading mechanized, onward distribution along the corridor’s major stations would greatly contribute to efficiency. Additional benefits will follow if such a dedicated freight corridor is operational - reduction in wagon turn-around time from the present 5.5 days and improved profitability for the railways resulting from engagement of more private players in the container-carrying business. Private ownership of rakes would lead to greater private investment in privately-owned warehouses, mechanized loading, etc. With the current routes earmarked for plying passenger trains and separate lines laid for freight traffic, the railways could achieve improved moving dimensions, longer loops of travel and higher axle loads, all leading to increased efficiency and profitability.
Thus tremendous commercial advantages will accrue to the nation and the rail-ways if the dedicated freight corridor is operationalised. However, for a developing country like India with limited capital resources, government investment in a solely commercial proposal is debatable. But a dedicated freight corridor would also be consistent with the social objectives of the country. Subsidized passenger fares for the majority of the economically-backward masses should be viewed against the concomitant creation of jobs along the length and breadth of the country in the public and private sectors. Heavy capital expenditure on new tracks will boost the country’s iron and steel, cement, locomotive and various other ancillary industries. Private investment will add to the assets of the country; it will homogenize and accelerate the development of the country. The resultant reduced road haulage will in turn reduce the oil pool deficit of the country, saving precious petroleum and equally precious forex reserves. Reduced road traffic and installation of electric traction along corridor will reduce the pollution levels in the country. Thus overall national social and economic interests will be met with the railways implementing a dedicated freight corridor.
