Indian Railways to permit Private Firms to run Freight Trains

Indian Railways to permit Private Firms to run Freight Trains

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New Delhi: The Indian Railway is set to allow private companies to run freight trains. These companies will run freight trains from their own terminal, though they will be using the railway infrastructure.

More Details:

  1.  The move assumes significance as entry of private players would not only break the monopoly of the railways but also help the national transporter recover from the financial crunch.
  2.  Under the freight-train operations scheme, companies can lease rakes from Indian Railways or have their own rakes manufactured as per their specifications, a senior railway ministry official  said
  3.  However, the train operations will still be managed by railways & companies will have to pay charges for using railway track and other infrastructure.
  4.  The decision has been taken in wake of the union Cabinet approving the setting up of (RDA) Rail Development Authority which is mandated to bring in the rail reforms.
  5.  This body will help the national carrier take decisions on pricing of services commensurate with costs, protect consumer interests, suggest measures for enhancement of non-fare revenue,  promote competition and encourage market development.
  6.  It will be mandated for creating positive environment for investment, promote efficient resource allocation and bench-marking of service standards, and suggest measures for absorption of new technologies.




  1.  As per the plan, private companies from cement, iron and steel, chemicals and fertilizers, food grains and automobile sectors have expressed their interest in operating their own freight trains.
  2.  Many of these companies have their own terminals that will be used for loading & offloading the goods.
  3.  Indian Railways estimated that with entry of private companies, its freight capacity can go up by nearly 30 million tonne. If the experiment is successful, it can be repeated for passenger services  as well.
  4.  For the current year, railways has decided to allow 55 private freight terminals in the country at an investment of Rs 5,000 crore (approx US$ 778.4 Million).

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