Dedicated freight corridors, a positive step
Welcoming the reduction in freight rates for iron ore, the Chairman of Steel Authority of India Ltd (SAIL), Mr. S.K Roongta, said: "Over the last few years, the changes in freight classification on steel making inputs had substantially increased freight cost.We welcome the reversal of this trend. Freight reduction of 6 per cent on iron ore, limestone and dolamite is likely to have a positive impact of around Rs 70 crore annually on SAIL in terms of savings on freight cost."
Stating that the growth plans of the steel industry, including those of SAIL, will need substantial additions to the railway infrastructure in the coming years, Mr Roongta said that the announcement of dedicated freight corridors is also a positive step and, when completed, will help meet the growing transportation requirements of the economy.
Other initiatives by the Railway Minister that would have a positive impact on the steel industry in terms of increasing demand are the proposed expansion of Rs 30,000 crore for freight corridor, increase in wagon production by 10 per cent including addition of 800 bogies to popular trains, revamping of rail infrastructure and laying of new rail lines, proposal of three-tier freight container movement and conversion of most of the meter gauge to broad gauge track, he said.
The SAIL Chairman also said that the company would be in a position to meet the increased requirement of the Indian Railways for different varieties steel product.
CAPACITY EXPANSION HAILED
Mr. J Mehra, Director, Essar Steel: "Railway Minister's shift to expanding new railway capacities is a welcome development after his earlier focus on utilising existing assets during past two-three budgets. His promise for new railway lines to new steel and & power project is also a positive initiative. We hope it becomes a reality soon. Railway Minister's announcement about cut in freight tariffs on iron ore is an initiative in the right direction. I hope it is applicable to all steel plants."
Mr. Naveen Jindal, Vice Chairman and Managing Director, Jindal Steel & Power: Steps like reduction in passenger fare, additional trains, other infrastructure developments, ease in ticketing, focus on cleanliness will encourage higher footfalls resulting in higher revenues. A reduction in freight rates of diesel and petrol by five per cent will help the economy and will have direct effect on the prices, which affects the common man. The reduction in freight rates minerals (iron ore, limestone and dolamite) will have a positive impact on the steel industry over all. The overall freight impact on the indutry is in the right direction and the goal of the budget is to improve efficiency and higher output. Keeping the freight rates untouched is a positive sign for the economy.