The Indian logistics sector has been undergoing a much-needed transformation with the impetus given to transportation infrastructure across the country. An important addition happened last month. Indian Railways achieved a significant milestone in its Dedicated Freight Corridor (DFC) project when the Eastern Dedicated Freight Corridor (EDFC) was completed. The entire 1,337 kilometre length of the EDFC has now been declared operational after the successful trial run of the first freight train over the 401-kilometre long New Sahnewal (Punjab)–to-New Khurja (Uttar Pradesh) section of the EDFC.
This will allow seamless and cost-competitive cargo movement and an accurate travel time prediction for freight transports that will have a far-reaching impact on trade.
Moreover, the corridor would multiply the capacity in terms of carrying heavier loads and volumes, as it could operate 480 heavy-haul freight trains each day. Besides facilitating quicker cargo transit, it will also ease traffic on the current rail and road networks.
AgenciesBoosting growth and efficiency
Projects like EDFC could prove a game-changer not only for the Indian Railways but also for the economy on the whole in the near future.
As per a World Bank report, DFCs will help India reduce its high logistics costs from some 13-15 per cent of the GDP and help it move towards the target of 8 per cent by bringing them more in line with global standards.
In addition, each kilometer-long freight train on the EDFC will replace some 72 trucks on average. This will ease congestion on India’s overcrowded roads and highways, which carry an overwhelming 60 per cent of the country’s freight.
Moreover, the move from diesel-operated trucks to electrified rail, together with the shift from older railway lines to the energy-efficient corridor, will reduce India’s fossil-fuel consumption and lower its carbon footprint, as the World Bank report highlighted.
Agencies
The coal corridor
Last year in April, acute coal shortages across the country triggered repetitive blackouts ranging from two hours to eight hours as many states struggled to meet the surging demand for electricity.
Simultaneously, factories also took a hit due to the power outage, and industry captains called for regulating electricity supplies. Apparently, the coal supply was hampered by the reduced availability of railway rakes, which led to coal inventories dipping to their lowest pre-summer levels in 2022 in at least nine years.
Meanwhile, international energy prices also shot up following the war in Ukraine, leading to a reduction in coal imports, and the problem exacerbated. The Centre frantically stepped up efforts to increase coal supplies to power plants and also asked the state governments to build up coal inventories for the next three years.
In the past, the Railways has to cancel passenger trains to make way for coal rains during acute shortages at thermal plants. The EDFC will connect a large part of North India to the coal mines in the eastern parts.
Things might change rapidly now, as far as coal supply is concerned. As per the official estimates, the coal transit time from the coalfields of Eastern India to the power plants of Northern India has been reduced by 30-40 per cent with the operationalisation of EDFC, ET has reported. This will further lead to a significant reduction in the inventory costs of power plants.
The east-to-north railway route brings coal from eastern coalfields to northern thermal power plants, but the line capacity has already been saturated due to the surge in passenger trains, which are given priority over freight trains. This leads to constant delays, but that could be a thing of the past now, as the EDFC would take most of the goods traffic from the busy Delhi-Howrah Grand Chord, helping to reduce congestion and increase the speed of passenger trains.
A study done by the Railway Board had emphasized the need to have dedicated coal corridors to meet the growing power demand in the country. The majority of the coal is transported from Odisha, Jharkhand and Chhattisgarh to the north, west and south-east of the country and there is a need to develop tracks exclusively for coal movement on these routes, said the report on estimation of coal transportation by rail by 2030.
India’s electricity consumption is expected to grow at an annual rate of 5.4% over the next decade, with annual demand touching 2,300 billion units by 2030, a study released last year by Arthur D. Little, a global management consulting firm, estimated.
Laggard no more
The 1,337-km EDFC will enable the freight trains to run at top speeds of 60-70 kmph, which will be a significant improvement as currently these trains run at 25-30 kmph or so. Though the corridor has been designed to achieve a maximum speed of 100 kmph for freight trains, that appears like a distant dream amidst the present state of affairs.
The arteries for multimodal hubs
Multi-modal logistics parks (MMLPs), which are being built to bring revolutionary improvements to India’s freight logistics sector, are part of the PM Gati Shakti National Master Plan, which was launched in 2021 to provide multimodal connectivity infrastructure to various economic zones. This master plan aims to enhance economic growth, infrastructure development, and the completion of projects in a time-bound manner, which is a big concern in India.
These multi-modal parks, the hubs that will connect various modes of transport, will be built at select locations along DFCs to lower logistics costs and increase freight modal share of railways. Several multi-modal logistic parks, including one on the riverfront at Varanasi at an estimated cost of Rs 5,000 crore, would be set up along the DFCs, spanning across the country to facilitate seamless movement of goods.
These parks will Improve the freight logistics sector, leading to lower overall freight costs and saving of time. It will have a cascading effect in terms of trimming warehousing costs, reducing vehicular congestion, and improving the tracking and traceability of consignments with the help of new technology.
These parks have been set up under the Logistics Efficiency Enhancement Programme (LEEP), to serve as intermodal freight-handling facilities with the help of mechanized material handling provisions.
Intermodal connectivity with DFCs, expressways,and highways will allow the smooth movement of cargo. Moreover, multi-modal parks will also provide other value-added services such as packaging, tagging,and crating, under one roof to further reduce cost and save time.
The DFCs will serve as arteries for these multi-modal parks.
According to government estimates, these multi-modal parks could leverage the new opportunities thrown up by DFCs, and are expected to attract investment to the tune of Rs 50,000 crore.
