The Center is
considering reducing railway freight rates for thermal coal shipped through
coastal transportation by changing the price calculation under the
rail-sea-rail (RSR) method. BLiTZ has
received this information.
Demand for coal is
expected to increase in the coming months; this move by the Centre aims at
increasing coal despatches and at the same time, keeping the cost of seaborne
coal less expensive.
This also comes
after Finance Minister Nirmala Sitharaman in her Union Budget speech for
2023-24 made clear her intention to promote coastal shipping.
Telescopic freight
i.e. journey from coal mine to port and then from destination port to power
house will be treated as one consignment thereby reducing the final freight
cost. At present, freight for rail
transport from mine to port and from destination port to power houses is
charged separately, making it very expensive.
The policy is facing some
resistance from the Ministry of Railways, because coal
transportation generates good revenue for the railways, to put it simply. None
will welcome revenue-loss it can be understood.