Who talk about decline in Railway’s freight share

In all developed countries, Railway share of total transportation is around 25%. In India too, it’ll ultimately stabilise at that level. This is a result of developing economy

“Who talk about decline in Railway’s freight share from 90%+ in early 1950s to about 30%+ today, and ways and means to boost the same, don’t know what they are talking about”, writes Indra Ghosh, former General Manager, East Coast Railway.

He writes, This figure of 90%+ being Railway’s freight share has been bandied around by Planning Commission – now Niti Ayog – for decades, without there being any actual basis, since nobody has figures for the total transportation sector at the time of Independence.

Moreover, he says, whatever sketchy figures are available of those times, those pertain only to the motorised portion of road transportation; whereas large percentage of road transportation was carried on by non motorised means such as bullock carts, horse carts, camel carts etc.

If we take the total transportation sector including non motorised road movement, then a figure of 75% being Railway share would be closer to the truth.

Gradually, as the non motorised movement got converted to motorised means, the percentage of road transportation (as maintained by Planning Commission) increased.

Be that as it may, it is a fact that Railway share of total transportation has reduced from 75% to around 30%+ today. However, this is not due to Railway inefficiency, but as a result of developing economy, he said.

Shri Ghosh says – At the time of Independence, there were hardly a handful of Cement plants across the country. So both raw materials as also finished products used to move by rail. Today, with large number of Cement plants spread out throughout the country, these plants have come much closer to their markets. Hence, large percentage of finished products move by road.

After all, if I’m a cement seller sitting 200 kms away from a Cement plant, I wouldn’t like to build up my inventory by getting 3000T of cement at one go. I would rather instruct the plant to send me 3 truckloads of Cement on a daily basis. It would save me both inventory cost as also stacking space.

Therefore, while raw materials are still moving by rail, and will continue to do so, finished products will gradually shift to road. !Same for all other sectors such as Fertilizer, Iron and Steel etc.

Regarding Food Grains too, till about three decades back, only Punjab and Haryana were surplus in Food Grains; so the surplus had to be moved from these two states to all over the country. Today, practically every state is self sufficient in Food Grains and only the surplus amounts have to be transported.

This is the reason why despite Food Grains production having gone up by leaps and bounds, Food Grains carried by Railway has increased only marginally.

In all developed countries, Railway share of total transportation is around 25%. In India too, it’ll ultimately stabilise at that level. As I said earlier, this is a result of developing economy.

In China, till few years back, Railway share was over 60%; but gradually over the years, it has come down to around 45%, and like most developed countries, it is likely to stabilise at less than 30%.

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