Bangalore: Pipavav Railway Corp. Ltd (PRCL), one of India’s 16 licensed container train operators, has secured a one-year extension from the railway ministry to start operations.
Pipavav Railway is a 50:50 joint venture company set up by Indian Railways and Gujarat Pipavav Port Ltd (GPPL) to construct, maintain and operate a 271km-long broad gauge railway line connecting Pipavav port to Surendranagar junction of Western Railway in Gujarat.
Private firms that were allowed to run container trains were mandated to start operations within three years of obtaining a licence or have it lapse, as per an agreement with the railway ministry in January 2006.
That deadline ended this January. Of the initial 14 licensed operators, only PRCL failed to comply with the condition.
“We have got a one-year extension from the railway ministry to start operating container trains,” said managing director, PRCL, Pankaj Malviya. “Presently, we have no plans to start operating container trains.”
Container trains: A file photo of the Tughlakabad railway station in New Delhi. Container train operators are offering innovative solutions. Rajkumar / Mint
“The firm has not purchased or placed orders for procuring rakes (wagons) for running container trains,” he added.
GPPL, developer and operator of Pipavav port in Gujarat on the country’s western coast, is 54.8% owned by APM Terminals Management BV, the world’s third biggest container port operator.
Other than PRCL, state-run fertilizer cooperative Krishak Bharati Cooperative Ltd (Kribhco) is also yet to start operations.
“Kribhco, however, has one more year to begin operations because it got a licence a year later,” said an industry executive.
Reliance Infrastructure Engineers Pvt. Ltd, owned by billionaire Anil Ambani, is also yet to commence full-fledged operations.
“But Reliance Infrastructure ran a container train service by hiring a rake (wagon) from another operator before the three-year period ended in January just to keep the licence,” the industry executive said. He did not want to be named.
Pipavav port currently handles some 500,000 containers a year, which are evacuated from the port or brought to the port on trains run by state-owned rail hauler Container Corp. of India Ltd, or Concor.
“Other container train operators are not able to run regular service to and from Pipavav port because of lack of volumes,” the executive said.
Private players have already invested at least Rs1,000 crore for buying some 55 rakes and developing cargo terminals.
One rake can carry 90 twenty-foot equivalent units, or TEU, or 45 forty-foot equivalent units, or FEU.
A TEU is the standard size of a container and a common measure of capacity in the container business. An FEU is double the size of a TEU.
But the economic slowdown has put the brakes on their plans.
“Container train operators have idled (parked) some 12 rakes a day on an average due to lack of cargo since October last year,” said R.C. Dubey, president of the Association of Container Train Operators, an industry lobby.
“The private firms have also put on hold orders for buying another 120 rakes due to lower demand for carrying cargo containers,” he added.
Given the current slowdown in export-import container traffic, container train operators are focusing more on domestic movements by offering innovative solutions to tap newer commodities that can be containerized, said Vinoo Sanjay, an executive tracking the sector at infrastructure consultancy firm Feedback Ventures Pvt. Ltd.
“Operators are trying to expand the spectrum of cargo that can be containerized to increase the base of domestic cargo moved by rail,” he said.
Some 500,000-550,000 TEU of local cargo containers are moved by rail in a year compared with 2-2.25 million TEU of export-import containers.