The Indian government owned and operated Indian Railways is considering a 15 percent cut in iron ore freight rates next month, a senior government official said on Wednesday, June 22.
The official said that recently Indian Railways scrapped dual freight rates for export and imports of iron ore and the current uniform rate is expected to boost freight volumes of iron ore on railways as well as make export shipments more price competitive.
Indian Railways is expecting that a further cut in freight rates will result in higher freight volumes, the official said.
According to the government official, lower iron freight rates and the resultant higher volume traffic will be the key to reversing the falling revenue earnings faced by Indian Railways in recent months. According to government data, Indian Railways total revenues during April-May, the first two months of the 2016-17 fiscal year, was down 13 percent year on year to $2.15 billion.