Top corporates have queued up for the railways’ wagon investment schemes, which allow private companies to procure their own freight trains. Companies such as Maruti Suzuki, Vedanta Aluminum, ACC, Ultratech Cement, Nalco, Balco, Hindalco and several others have sought the railways’ approval to procure freight trains.
So far, approvals for procurement of around 56 rakes to 15 firms have been accorded by the ministry of railways. The purchases have an approximate value of R1,200 crore.
The railways run the wagon investment schemes under the freight marketing division, whose mandate is to increase railways? freight share in unconventional traffic, which is usually moved by road.
?Under the liberal wagon investment scheme (LWIS), several cement and aluminum companies have come forward to procure freight trains. The scheme is a win-win situation for both the private sector and railways as they get around 15% concession on freight rates for 20 years and the railways get the traffic that is usually moved by road,? a railway board official said.
The policy allows investment in special purpose wagons (SPWs) and high- capacity wagons (HCW) by end-users, producers, manufacturers and consumers.
Under the scheme, each rake procured by investor has an associated loading and unloading point over specific route or close circuit as approved by the railways. Wagon leasing companies can a lso procure wagons under this scheme for leasing to end-users. A freight concession of 15% is granted for 20 years on each loading of SPW operating in approved close circuits. In case of HCW, a freight concession of 12% is granted for 20 years on each loading with an additional freight concession of 0.5% for each additional tonne of payload.
The freight scheme for the auto sector is also getting an overwhelming response from auto majors. Under the auto freight train operator (AFTO) scheme, Maruti Suzuki has bought three special wagon rakes and APL logistics has procured one rake. Each rake can carry around 320 small cars.
?Only 5% of auto is transported by the Indian Railways and through AFTO we want to increase it to 25%. Other major auto companies have shown interest in procuring rakes,? the railway board official added.
