Hike in Rail Freight Prices Worries Units in Noida

Hike in Rail Freight Prices Worries Units in Noida

The decision to increase freight charges and linking them to diesel prices has created a chaos for companies based in Noida and Grater Noida, which is the largest industrial belt in northern India.

The railway budget recently proposed by the Railway minister, Pawan Kumar Bansal, will take effect from 1 Apr. The freight on diesel has increased by 5.79% to 1,041.80 per tonne from `984.80 per tonne at present.

The freight charges have linked to the diesel prices and that has become major worry for the companies. There is always uncertainity over diesel prices. The price keeps on increasing by 50 paise every month and always has uncertainty due to partial de-regulation.

Vipin Malhan, president of Noida Entrepreneurs Association, revealed that they have already written to the railway minister about linking the freight rates with diesel prices. It would have a negative impact on the operation costs in industries like electronics, plastic, automobiles, construction and many others that have to import raw material using freight transport.

Noida Entrepreneurs Association is an umbrella body that represents over 60,000 industries in the twin townships.

VS Khurana, director of Vidya Electrotech, a television manufacturing company in Noida, said, "Rail freight that has traditionally been the cheaper commercial transport for small and medium industries is now coming at par with road commercial transport, which is a bad sign".

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