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CareEdge Research Report
In this report, we have analysed the imminent shift in the mode of freight movements from roadways to railways and the underlying factors facilitating the transition.
We expects container rail volumes to grow at a healthy compounded annual growth rate of 15.60% for FY22 to FY25 with steady improvement in rail-coefficient to 31%.
Slated completion of the prestigious dedicated freight corridor project by June 2023, increased trips of cost-effective double-stack container trains and incremental volumes of cement cargo through railways are prominent factors influencing the switch from roads to rail.
we believe that transit assurance under DFC aiming to squeeze the travel period by 40- 50% for some of the major routes shall accelerate this transition. This shall help in achieving ‘Just in Time' inventory management and hence improve cost competitiveness.
Nevertheless, higher haulage rates for freight traffic due to extensive cross-subsidisation of passenger traffic and the absence of a regulatory body for the railways are the underlying key challenges for the modal shift.
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