Indian Railways Rationalized Coal Tariff by Changing Distance Slab

Indian Railways revised coal freight rates with alteration in distance slab from 50 km to 25 km.

With the aim to boost freight revenue, Indian Railways rationalized coal tariff by changing distance slabs. The new slab distance and rates will be applicable above 426 kms.

The Railways has revised the distance slabs from 1-125 kms to 1-100 Kms. However, overall price charges, applicable for distance under 0-200 kms are kept unchanged.

The revised Railway freight rates will affect the overall cost of cement and steel manufacturing units.

Major Highlights
• Alteration on coal freight charges seems profitable for the short distance pithead coal-based power plants as their distance fall under less-than-100 km slab.

• The alteration in price is applicable from long distance rail trade above 426 kms.

• Indian Railways also levy a coal terminal surcharge (CTS) at INR 55/MT at loading and unloading terminals for distances beyond 100 kms.

• There is no negative impact on the fuel cost, while fuel sourcing cost will be the same lines as the pithead plants.

• Main purpose is to make freight price equivalent for short distance and long distance power plants to gets actual benefit as their plants are situated faraway from coal mines.

Source: Ministry of Railway
Distance in km
Prices in INR

Moreover, the revised freight rates comprises of changes in distance slab and price for long distance trade. For short distance trades, prices are kept unchanged and only slab range is changed.