INTRODUCTION Indian Railways (reporting mark IR) is an Indian state- owned enterprise, owned and operated by the government of India through the Ministry of Railways. It is one of the worlds largest railway networks comprising 115,000 km (71,000 mi) of track over a route of 65,000 km (40,000 mi) and 7,500 stations. Railways were first introduced to India in 1853 from Bombay to Thane.
CONTINUED IR carries about 7,500 million passengers annually or more than 20 million passengers daily (more than a half of which are suburban passengers) and 2.8 million tons of freight daily. In 2011-2012 Indian Railways earned 104,278.79 crore (US$19.71 billion) which consists of 69,675.97 crore (US$13.17 billion) from freight and 28,645.52 crore (US$5.41 billion) from passengers tickets.
INTRODUCTION Its operations cover twenty four states and three union territories and also provides limited international services to Nepal, Bangladesh and Pakistan. Indian Railways is the worlds fourth largest commercial or utility employer, by number of employees, with over 1.4 million employees. As for rolling stock, IR holds over 229,381 Freight Wagons, 59,713 Passenger Coaches and 9,213 Locomotives. The trains have a 5 digit numbering system as the Indian Railways runs about 10,000 trains daily. As of 31 March 2012, 22,224 km (13,809 mi) (34%) of the total 65,000 km (40,000 mi) km route length was electrified.
COMMERCIAL MOVEMENT Indian Railways earns about 70% of its revenues from the freight traffic (Rs.686.2 billion from freight and Rs.304.6 billion from passengers in 2011-12). Most of its profits come from movement of freight. It makes a loss on passenger traffic. It deliberately keeps its passenger fares low and cross- subsidises the loss-making passenger traffic with the profit- making freight traffic.
SWOT ANALYSIS STRENGHTS: There is a consistent growth over a CAGR of 25 % with a potential of 100 mmt in the year 2005-06. A total of 1.7 MTEUs were rail borne, out of which the North contributed 0.71 MTEUs and the West 0.23 MTEUS.
WEAKNESS This is a highly capital intensive business and the cost of rolling stock is around Rs.13 crores/rail. The cost of operating an inland container depot is around Rs. 100 crores. There is a long gestation period and the project may take sometimes up to 10 years to achieve break even. There is high concentration of traffic at selected port. 78 % of the total container cargo is handled by west coast ports. 70 % of total traffic at the west coast is handled by a single port, i.e. Jawaharlal Nehru Port Trust (JNPT). 60 % of the traffic of the west coast moves to the northern hinterland, which leads to a heavy congestion along the routes.
OPPORTUNITIES With the growth of containerization due to growing GDP, there exists huge potential in the form of a largely virgin market. With the congestion at the existing road linkage ICDs and limited scope for excavation, there is an opportunity for development of competing facilities. There is a potential for running double stacked trains with the lower haulage charges and better utilisation of rolling stock and track capacity.
THREATS This industry is highly dependent on external agencies such as Indian Railways, port terminal operators and shipping lines. There are still several unresolved issues on operational matters, such as stability of rakes, service guarantee and dedicated freight corridors. With regards to double stacked operations due to the lack of a developed infrastructure, this may take time to take off in a larger way. There exists fragmentation on volumes due to multiple operations and there is no control on haulage cost.
FREIGHT RATE In Existing freight structure ,some 3000 commodities have been classified into several classes, which are shown as class rates. The class rates -start from 60 which is the lowest and end at class rate 300, which is the highest.(per quintal).
CONTINUED… Along with class rates Wagon load rates ,Trainload rates has also been introduced for certain commodities like grains, Pulses, coal, Fertilizer, cement, iron and steel, limestone etc. Special Rates- For Defence, postal tarrif etc. Station-to-Station Rate- To meet competition from alternative modes of transport and to generate additional freight traffic.