Indian Railways targets 55% freight modal share for global competitiveness

NEW DELHI : Indian Railways must double its modal share in freight to 55% for India to achieve global economic competitiveness, according to Railway Minister Shri Ashwini Vaishnaw.

“On aggregate, we should be reaching 55% rail and 45% road. The minister said adding that by doing so, the cost of logistics will reduce to anywhere between 7.5-8.0% of the GDP.

The focus is on reaching 80-85% rail share for heavy cargo like coal, cement, and steel, while parcels should see a 50-50 split between rail and road, he said.

The National Rail Plan aims for a 45% share of freight traffic by rail by 2030, with ongoing efforts including dedicated freight corridors, increased network capacity, and infrastructure upgrades.

Measures such as the development of dedicated freight corridors, increasing network capacity and upgrading infrastructure are being executed to meet that objective.

The minister highlights the completion of dedicated freight corridors and ongoing track laying at 14 km per day to meet rising demand.

The government allocated Rs 26,000 crore for new tracks in FY23, with a further increase to Rs 31,850 crore in FY24, maintaining an overall budget between Rs 2.4 and Rs 2.6 lakh crore.

Vaishnaw further emphasises the economic benefits of rail transport, suggesting potential savings of Rs 1.25 lakh crore annually for the logistics sector.

Vaishnaw also highlighted the limited involvement of the private sector in the railway industry, attributing it to the intricate nature of the network.

He argued that the complexity is better managed within the public sector, citing the UK’s experience of reverting railways to government oversight following unsuccessful attempts at privatization.

According to him, the sector’s intricacies pose challenges for private firms, making it difficult to allocate responsibility for network failures due to the interactions of multiple subsystems