Falling coal demand puts 2-mt dent in freight loaded
NEW DELHI: The slowdown in the core economy has hit the Railways hard with the national transporter lowering its freight loading target for the present fiscal (2016-17) by two million tonne (mt), as per the revised estimates.
Lower loading has also led the Railways to temper its freight earnings in 2016-17, which are expected to drop to ₹1.089 lakh crore from ₹1.092 lakh crore in 2015-16.
In last year’s Budget, the Railways had set a target to load an extra 50 million tonnes of cargo this year, against the previous fiscal. This projection had to be sharply revised downwards, following a drop in loading and average distance of transporting coal and other commodities in the first half.
The demand for coal, which accounts for 50 per cent of total freight, had dipped following lower demand for power by industry. Additionally, the average distance of coal transportation had fallen as power plants were located close to pitheads.
As a result, the Railways had to revise its freight loading target of 1,093 mt in 2016-17.
“There was a sharp drop in coal loading till November, which has now improved,” Railways Member-Traffic Mohammed Jamshed recently told.
Cargo loading for the year would have been lower had the Railways not seen an improvement since December 2016. From January, demand for coal has picked up with Coal India moving 240 wagons a month.
Loading in January, February and March is expected to be higher than these three months last year, say sources.
To meet the revised loading target this year, the Railways will have to load at least 94 million tonnes each month in January-March.
The national transporter has set an ambitious target of loading an incremental 72 mt in the 2017-18. This is almost 50 per cent higher than the incremental loading target of 50 million tonne set for last year.