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Indian Railways' Bulk Cement Reforms Cut Costs, Boost Green Transport

Indian Railways' reforms to promote rail-based movement of bulk cement in tank containers are yielding positive results, with many cement companies approaching CONCOR. The railways recently reduced the freight charge and introduced discounts for empty return trips, making rail transport significantly more competitive than road. These changes are expected to lower overall freight costs, reduce fuel consumption and emissions, and improve plant-to-market efficiency. The new scheme replaces an older, less attractive pricing model that was deterring cement producers from shifting from road to rail.

Key Points: Railways' Bulk Cement Reforms Cut Freight Costs, Emissions

  • Lowered freight charge to 85 paise/tonne/km
  • Discounts for empty return trips
  • Reduces fuel costs and emissions
  • Faster turnaround than bagged cement
2 min read

Indian Railways' reforms in bulk cement transportation receives good response

Indian Railways' new pricing for bulk cement in tank containers lowers freight costs, reduces emissions, and gets strong industry response.

"The response of the trade to this innovative charging scheme has been very good. - Official Release"

New Delhi, February 7

Efforts by Indian Railways to increase loading and promote rail-based movement of bulk cement in tank containers are bringing positive results. Many cement companies have approached CONCOR for the movement of bulk cement in tank containers, according to a release.

CONCOR is also facilitating the installation of silos at its terminals for bulk cement handling and storage. To deepen the reforms and make its schemes more attractive, Indian Railways recently reduced the charge on a GTKM basis from 90 paise to 85 paise per tonne per kilometre. This, along with discounts for empty return movements to the originating terminal on a GTKM basis, is making rail movement of bulk cement in tank containers significantly more competitive than road.

The response of the trade to this innovative charging scheme has been very good. This scheme will result in a reduction in overall freight cost for bulk cement movement. This will result in lower fuel cost and reduced emissions. The reforms support faster turnaround and lower handling losses than bagged cement. It also facilitates the adoption of tank containers in bulk cement logistics, improving plant-to-market efficiency.

Earlier, Indian Railways was charging haulage on per TEU basis as per the distance slab for movement of bulk cement in tank containers with a graded discount on haulage in the empty return direction, i.e., 50% in the first year, 40% in the second year, 30% in the third year, 20% in the fourth year, 10% in the fifth year, and no discount from the sixth year onwards.

However, this basis of charging was found to be unattractive for cement producers and was acting as a deterrent to shifting bulk cement movement to rail from road. In order to increase loading and promote rail-based movement of bulk cement in tank containers, Railways brought reform in rates to make win-win situation for Railways and customers.

- ANI

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Reader Comments

P
Priya S
Finally, a sensible policy shift. The old slab system was too complicated and discouraged companies. The new per-kilometre charge with empty return discounts is much simpler and should attract more business to rail. Hope this efficiency translates to slightly lower prices for home builders.
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Aman W
Good step, but execution is key. CONCOR needs to ensure the silos at terminals are well-maintained and the turnaround time is as promised. Our logistics sector needs more such modal shifts from road to rail. Less truck traffic on highways is always a plus!
S
Sarah B
The environmental angle is significant. Bulk transport in tank containers means less plastic and jute waste from bags, plus lower fuel consumption. Every bit helps in fighting pollution. Hope other industries take note and explore similar rail-based solutions.
V
Vikram M
As someone in the construction business in Gujarat, this is welcome news. Cement is a major cost. If rail transport becomes reliably cheaper and faster, it will help margins and project timelines. Let's see if the companies actually pass on the savings.
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Karthik V
Respectfully, while the reform is good, the reduction from 90 paise to 85 paise per GTKM seems very modest. For long-term success, Railways needs to be even more aggressive on pricing to decisively beat road transport. The initial discount structure was clearly a failure, glad they recognized it.

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