Rail freight earning down 11%; loading close pre-covid level in July2 min read . Updated: 06 Aug 2020, 07:15 PM IST
Freight earning as well as loading was up nearly 2%. Railway ministry officials said that said that demand is picking up with economic activity getting back to pre-covid-19 days
Indian Railways’ freight revenue declined 10.6% on-year in July to ₹8,969 crore, with loading witnessing de-growth of 4.6% during the same period to 95.2 million tonne (MT), official data showed.
However, sequentially, freight earning as well as loading was up nearly 2%. Railway ministry officials said that said that demand is picking up with economic activity getting back to pre-covid-19 days.
A senior government said that freight loading picked up in the last week of July and the trend is expected to continue in August. For instance, on July 28 loading was up 19% on year to 3.29 MT, while revenue was up 5% on year to ₹308.4 crore.
However, during the first four of the financial year, earnings continued to remain subdued to due the disruption caused by coronavirus. During April-July, earnings from movement of goods declined 26.4% on-year to ₹31,235 crore. Freight traffic volume was down 17.3% during the same period to 336.7 MT.
“Railways has staged a smart recovery on the freight side for the month of July. Food grains and fertilizer has outperformed the previous year’s numbers. Coal, which is predominantly moved by railways has had a dip and this has been offset by the carriage of other bulk commodities like steel. Overall, this is a positive development. It is important that railways maintains this growth trajectory and not lose much to road once the economy opens up," Jagannarayan Padmanabhan, Director and Practice Lead, Transport and Logistics at CRISIL Infrastructure Advisory said.
The railways transport a wide basket of goods, including foodgrain, fertilizers and industrial outputs, such as coal, cement and iron ore, among others. The cement and coal segments comprise more than 50% of freight movement for the national transporter. Earnings from coal declined to ₹12,773 crore in April-July from ₹21,457 crore in the same period last year. Earnings from cement fell to ₹2,284 crore from ₹3,052 crore a year-ago. However, the movement of foodgrain witnessed a jumped to ₹3,442 crore , from ₹2,354 crore a year ago.
In the current fiscal, Indian railways is drawing up a strategy to substantially increase its freight revenue as it expects earnings from the passenger train segment to take a beating due to the covid-19 crisis. Last week, railway board chairman had said that the national transporter may incur a loss of around ₹35,000 crore from the passenger train segment as only 230 trains are running across the country.
“Improvements in freight movements will be institutionalized and incorporated in the upcoming zero based time table. These steps will lead to significantly higher freight traffic and earnings for Railways and cost competitive logistics for the entire country. A number of concessions/discounts are also being given in Indian Railways to make Railways freight movement very attractive," railway ministry had said last week.