The Hindu Business Line : Earnings on right track

Six months into its operations, Kutch Railway Company Ltd, a joint venture promoted by Rail Vikas Nigam Ltd, Kandla Port Trust, Gujarat Adani Ports Ltd and the Gujarat Government, has recorded Rs 30 crore in revenues. These earnings are from the first phase operations of the 248-km rail line between Gandhidham and Samakhiali that was commissioned on March 24.

The second phase, the 53-km broad gauge rail link between Samakhiali and Gandhidham, is likely to be commissioned by this month-end, according to Mr Yogendra Sharma, Managing Director, Kutch Railway. Having lowered the landed project cost to Rs 499.95 crore (December 2005) from Rs 550 crore (June 2005), the company hopes to further lower costs by Rs 20 crore. "We hope to cut costs by Rs 20 crore," said Mr Sharma.

CARGO VOLUMES

"During the last six months, 1,200 freight trains have moved on our track, carrying almost two million tonnes of freight cargo," Mr Sharma said. Of the two million tonnes, the maximum volumes moved are of fertilisers, followed by containerised traffic. The next highest volume of cargo moved is salt, followed by petroleum, oil and lubricants, and vegetable oil.

Kutch Railway is mandated to plan, finance, construct, operate and maintain the 301-km rail link between Palanpur and Gandhidham in Gujarat. Thus, for the freight trains that run on its line, the company gets access charges from the Indian Railways. Simply put, the customers of freight trains are billed by Indian Railways which, in turn, apportions a part of its earnings to Kutch Railway as track access charges.

PERFORMANCE PARAMETERS

Kutch Railway has been able to record a unit cost per net tonne kilometer (NTKM) of 49 paise (April-September 2006). While the latest data for the Indian Railways is unavailable, IR had a unit cost per NTKM of about 52 paise (for 2005-06). "We have been able to manage a low unit cost based on higher speed, low staff cost and mechanised maintenance systems," said Mr Sharma.

The company has also managed an average speed of 25.4 km per hour for freight trains on its tracks for the six-month period, Mr Sharma said. The average speed of trains in the Western Railways was 21.1 km per hour in 2004-05 (the latest data is unavailable officially).

Moreover, at present, only freight trains run on the Kutch Railway's tracks. Passenger trains are yet to be operated, unlike in the Western Railway, where both passenger and freight trains run.

Passenger lines can run on the Kutch Railway line only after it gets a safety clearance. "The Commissionerate of Railway Safety has recently inspected the first phase line," Mr Sharma said.

The comparisons would be fairer when this link also has a mix of trains (freight and passenger), apart from comparing speeds for exactly same periods.

CONSULTANCY JOBS

Moreover, in a move that would add to the company's revenue generation, Kutch Railway is also taking up consultancy works. "We have taken up a task for Sanghi Cements to do a study on cost of construction of a new line between Sanghipuram and Naliya (42 km), and gauge conversion between Naliya and Bhuj (102 km)."

Sanghi Cements has a cement manufacturing plant in Sanghipuram. The nearest rail-head is in Naliya and the metre gauge rail link between Bhuj and Naliya have been truncated. "We are also helping Gujarat Investment Development Board in financial modelling of a rail-link between Mehsana and Bhiladi, which will connect South Gujarat to the hinterland.