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Lowest dip in Freight Loading for Railways since 2010

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An astounding 8% drop in freight loading in October 2019

The Indian Railways witnessed a whopping 8% drop in freight loading this October when recorded against the same period fiscal. This has been the first time in the past nine years that the Railways has seen such a stark decline in freight loading.

This September, in a bid to attract customers, the Railways had decided to scrap off a 15% season surcharge that would have applied from October 1. This decision was taken with an aim to encourage more railway customers into choosing a cheaper mode to move their cargo, that too without the festive season surcharge, but the year-on-year decline proved to be otherwise.

In September, the net tonne kilometers (ntkm) dipped 11.2% to 49355 million. By the end of October, this has sunk to just over  11%, meaning thereby that the distance moved by the cargo has also decreased.

The movement of most commodities by the rail mode is lower in October 2019 as against October 2018, as reported by The Hindu Business Line. The commodities that are chugging less include: coal (drop by 12.5%), raw material for steel plants except iron ore (almost 8%), domestic container movement (almost 14%), cement (14%), clinker (almost 3%), foodgrain (13.5%) and domestic container movement (almost 14%).

The commodities that were loaded more during the festive month of Diwali this year include fertiliser (6.5% growth), domestic coal for steel plants (almost 3%), pig iron and finished steel from steel plants (7.6%), iron ore movement for export (more than double), and export-import containers (over 6% growth), as quoted by The Hindu Business Line.

The fact that customers prefer road transport to railways mode may be one of the reasons attributing to the fall in the freight loading. But another reason that might be a cause of this dip in freight loading may be attributed to the increase in adoption of greener strategies by customers. This has led to people opting for coastal shipping modes that are cheaper although they involve a third of the additional time in shipping the goods. Thus a green logistics factor can also be another reason for this dip in cargo loading.

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