Global Rail Freight Conference

Hon’ble Minister for Railways, Deputy Chairman/Planning Commission, Minister of State for Railways, Chief Executive and Deputy Chief Executive of UIC,

Indian Railways is indeed privileged to host this two day Global Rail Freight Conference in New Delhi. The International Union of Railways has given this opportunity to deliberate on topics which are of utmost importance to Indian Railways and other Railway Systems.

Indian Railways is one railway system where both passenger and traffic is intense on common infrastructure. In the last three years, Indian railways have achieved a growth rate of more than 9% and 7% in freight and passenger traffic respectively. Today, apart from focusing and enhancing the market share, railway operating companies have to devise a strategy of reform which is built around generation of capacity through optimization of the existing infrastructure and assets aimed to reduce the cost of operation. This is necessary as large scale funds will be required for major capacity augmentation in view of increase in growth of economy. Innovative financing schemes will have to be devised for implementation of projects aiming to enhance the capacity.

Operational innovations on Indian Railways have led to a lowering of unit cost of operation in the face of rising costs of inputs. These measures have redefined the transport scene in the country and have positioned the railways as a competitive and viable alternative to road transport. Indian Railways is likely to earn a record surplus of US$ 4.5 billion in the current financial year.

On freight side, tariff rationalization, enhancement of axle loads, reducing the cost of operation through Double Stack Containers have started paying rich dividends to Indian Railways. The market shares of certain commodities have increased with such measures. Today, Indian Railways can boost of have a system which is achieving one of the lowest operating ratios in the world, in spite of having a strong work force of 1.4 million and without increasing the tariffs.

Indian Railways have exploded the wide-spread cynicism that government systems can not deliver. Not long ago, there was virtually no international conference on railways which did not extol the models of privatization adopted in certain countries. Today, nobody speaks about these examples because they have not worked. On the other hand, the resurgence of railways in China and India, which are the last few bastions of government-owned railways, are being studied for appropriate lessons. The great Chinese leader, late Deng Xiapeng had once said, "A cat is a cat as long as it catches mice". The true test of an organization is whether it delivers. There is no doubt that as long as Indian Railways travels on the path of positive and programmed pragmatism, nothing can stop its forward march.

Today, the future looks bright. The traffic volumes are expected to double the current traffic volumes by 2015. We have therefore chalked out a well planned strategy to remove bottlenecks and augment capacity to match the requirements.

As part of this strategy, the focus will shift to investment in infrastructure, modernization, use of information technology, building world-class terminals, segregation of passenger and freight infrastructure and resource mobilization through innovative financing schemes.

Our investment strategy over the next decade would give top-most priority to accelerate the identified projects of Dedicated Freight Corridors, strengthening port and industry rail linkages, augmentation of manufacturing capacities of rolling stock manufacturing units and creating world class terminals and logistic parks. Implementing Dedicated Freight Corridor projects involving an investment of US$ 6 billion will be one of the key strategies to capture large share of freight traffic. The project will remove the existing constraints on the network by adoption of movement of heavier and longer trains, better pay load to tare wagons and totally separating the corridor from Roadways by construction of Grade Separators.

On resource mobilization, innovative financing mechanisms built on Public Private Partnerships are being devised. Indian Railways under PPP is not only implementing infrastructure projects but is also exploring possibilities for manufacturing of locomotives, development of passenger terminals, logistic parks. Permission to private operators for movement of container trains has been granted which will increase containerization in the country.

I am glad that the Conference will cover the emerging areas of global logistic chains, the various challenges and opportunities for rail transport and the perspectives of major customers. The Sessions on Rail Freight Expansion Plans & Initiatives, Research & Development and New Technologies will be very useful experience sharing for all. The successful implementation of mega rail projects would require innovative financing strategies and right legal framework that would facilitate such project implementation and it is only appropriate that the Conference covers this important area.

The conference will enable to explore new challenges, adoption of best practices and will give an insight to on-going developments and freight infrastructure projects.

I wish the Conference all success.

Thank you