The Railway Minister, Suresh Prabhu presented his second Railway Budget for 2016 on Thursday.
The railway budget presents great opportunities for the logistics sector, Vineet Agarwal, Managing Director, TCI Group said. Railway Minister, Suresh Prabhu presented his second Railway Budget on Thursday.
While speaking to dna, Agarwal, said, " “We welcome the Rail Budget and at the outset it presents great opportunities to the logistics sector".
"Delivery capabilities of logistics players are set to improve with announcements like Transport Development Corporation and multi-modal depots. We are also pleased to know that the ministry has put together a proposed investment plan that will include crucial areas like network expansion, high-speed rail, elevated corridor, station redevelopment and Logistics Park. The announcement of logistics and warehouse parks to be created on PPP mode is also a step in the right direction", he added.
Further, he said, "the proposal of building dedicated freight corridors to boost North-South, East-West connectivity will also prove very useful. We are keen to see the pilot that would be running around the time-table freight container train. Commissioning dedicated freight corridors are the need of the hour and we hope that this announcement would be executed well. The connectivity of airports with railways would give a boost to the perishable goods sector and this would encourage the use of multi-modal transportation".
Moreover, said that it was pleasing to see that the Minister had promised the rationalizing of the tariff structure by undertaking a review to evolve competitive rates vis-a-vis other modes of transport and to expand the freight basket as a means of additional revenue
However, he said that the budget doesn’t explicitly address on efforts to increase the share of movements by rail compared to the road sector. The model mix is still heavily tilted to road and the recent drop in fuel prices has further fueled the growth in road movements. In the same period, rail freight rates have increased, making it a big challenge for industry to shift to rail transport.
"In addition, the integration of all modes of transport be it road, rail, air and sea, is still a dream. For the industry to be competitive at a global level, integrating all modes to bring in cost and operational efficiencies is a must and the same is not covered in the current budget," he added.
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