Indian Railways Plans for DFC, Multomodal & International Rail Cargo Transportation

Sanjiv Garg Additional Member Railway Board, September 28, 2018 DEDICATED FREIGHT CORRIDORS Golden Quadrilateral & Its Diagonals

High Density Corridor (Golden Quadrilateral + Diagonals)

16% of route KOLKATTA Km carries more than 52% of passenger & 58 % of freight CHENNAI

www.dfccil.gov.in CONCEPT PLAN OF DEDICATED FREIGHT CORRIDOR NETWORK

LUDHIANA

DELHI

KOLKATA

MUMBAI

Sanctioned projects VIJAYAWADA VASCO Unsanctioned projects CHENNAI

www.dfccil.gov.in Eastern Corridor (1856 km) Khurja -Bhaupur (343 km) Bhaupur-Mughalsarai (402 km) Khurja-Ludhiana (400 km) Khurja-Dadri (47 km) Western Corridor (1504 km) Mughalsarai-Sonnagar (126 km) Rewari-Vadodara (947 km) Sonnagar-Dankuni (538 km) Vadodara-JNPT ( 430 km) Rewari-Dadri (127 km)

5 Introduction

Feb 2006 CCEA approved feasibility reports of DFC.

Nov 2007 CCEA gave ‘in principle’ approval with authorization to incur expenditure on preliminary and preparatory works. Feb 2008 CCEA approved undertaking work & extension of EDFC from Sonnagar to Dankuni. Directed MoR to finalise financing and implementation mechanisms

Sept 2009 Cabinet approved JICA loan for WDFC along with STEP loan conditionalities

Mar 2010 JICA Loan Agreement for JPY 90 billion (Rs. 5100 crores) signed for WDFC-I.

Oct 2011 Loan Agreement with World Bank for USD 975 Million (Rs. 5850 crores) signed for EDFC -1 (Khurja-Bhaupur).

Mar 2013 JICA Loan Agreement for WDFC Phase-II: 1st Tranche amounting JPY 136 billion (Rs. 7750 crores) signed. Dec 2014 Loan Agreement with World Bank loan of USD 1100 million signed (EDFC-2).

June 2015 Cost estimate of Rs. 81,459 Crores approved by CCEA. March 2016 First Goods train run between Sasaram-Durgawati. Oct 2016 Loan Agreement with World Bank loan of USD 650 million signed (EDFC-3).

Jan 2017 All Civil, Electrical and S&T contracts of WDFC finalized. Feb 2018 All Civil contracts of Eastern Corridor finalized. 6 Basic features of the project

Name of State Length in Length in Total % of total EDFC WDFC (in length (in length (in KM) KM) KM) Uttar Pradesh 1058 19 1077 38% Bihar 100 - 100 3.5% Punjab 88 - 88 3.1% 72 176 248 8.8% - 567 567 20.1% Gujarat - 565 565 20% Maharashtra - 177 177 6.3% Total 1318 1504 2822* 100% * This excludes 538 km of Sonnagar-Dankuni section.

7 Funding Plan

Particulars Eastern Wester(All figs. in INRTotal Crores) Corridor n Corrid or Equity from MoR 11,334 7,996 19,330 Loan from JICA - 38,722 38,722 Loan from World Bank 15,340 - 15,340 Total Funding 26,674 46,718 73,392 (without Land) MoR (Land) 3,684 4,383 8,067 Total Funding with 30,358 51,101 81,459 Land Multi-lateral (JICA/World Bank) Funding details

World Bank loan for EDFC Section KM Loan Amount Loan Agreement (in Million US$) Date Khurja-Bhaupur 343 EDFC-1 800 27-Oct-11 Khurja-Dadri 46 EDFC-2 Bhaupur-MGS 402 910 11-Dec-14 EDFC-3 Ludhiana-Khurja 401 650 21-Oct-16 Total 1192 2,360 JICA loan for WDFC Phase Section KM Loan amount LOAN Tranche Loan Date of (Billion Yen) tranche (Billion Yen) Agreement 1 90.2 31-Mar-10 I Rewari-Vadodara 947 273 2 103.6 31-Mar-16 Vadodara-JNPT 430 II 296 1 136.1 28-Mar-13 Rewari-Dadri 127 TOTA 1504 569 329.9 L Though the project was approved in 2008, real project implementation started with the approval of first loan for construction works in WDFC & EDFC in March, 2010 & October, 2011 respectively. 9 Basic Design Features

Indian Railway DFC Routes

Moving Dimensions 5.1m 4.265 m 7.1 m Height

Western Corridor Eastern Corridor

Width

3200 mm 3660 mm

Container Stack

Western Corridor Eastern Corridor

Train Length

700 m 700/ 1500 m

Axle Load 22.9 t / 25 t 32.5t/25 t

Maximum Speed 75 Kmph www.dfccil.gov.in100 Kmph Basic Design Features (Contd.)

Indian Railway DFC Routes  Heavier Axle Loads

25 t (Track Structure) Axle Load 22.9 t / 25 t Bridges & formation designed for 32.5 t (+30%)

Maximum Speed (+33%) Predominantly 75 Kmph 100 Kmph Average speed 26.5 kmph 65 kmph (+145%)

Gradient Upto 1 in 100 1 in 200 (easier) Traction Electrical (25 kV) Electrical (2 x 25 KV System)

Signalling Absolute /Automatic Automatic with 2 Km spacing in

with 1 Km spacing Automatic territory11 Heavier, longer & faster freight trains will enhance freight throughput – additional 120 train paths each way. BROAD FEATURES OF CONCESSION AGREEMENT

• THE RELATIONSHIP BETWEEN AND DFCCIL GOVERNED BY A CONCESSION AGREEMENT • CONCESSION IS FOR A PERIOD OF THIRTY YEARS FROM THE DATE OF START OF OPERATION. • INDIAN RAILWAYS IS THE SOLE OWNER AND FOR THE PRESENT ONLY CUSTOMER OF DFCCIL. • DFCCIL’S - INFRASTRUCTURE PROVIDER WITH RESPONSIBILITY OF CONSTRUCTION, OPERATION AND MAINTENANCE. • IN FIRST PHASE, TWO CORRIDORS ARE BEING CONSTRUCTED– • EASTERN CORRIDOR FROM LUDHIANA TO DANKUNI AND • WESTERN CORRIDOR FROM DADRI TO JAWAHARLAL NEHRU PORT . • PROVISION FOR NON-DISCRIMINATORY ACCESS TO INDIAN RAILWAYS AND OTHER QUALIFIED OPERATORS.

12 OPERATING ASPECTS OF DFCC

 DFCCIL TO MANAGE TRAIN OPERATION AND INFRASTRUCTURE MAINTENANCE ON DFC.

 DFCCIL TO HAVE OWN STATIONS AND CONTROL CENTERS.

 ROLLING STOCK OWNERSHIP & ITS MAINTENANCE BY IR.

 FEEDER ROUTES /SIDINGS TO BE UPGRADED BY IR .

 COMPLETE GRADE SEPERATION - ALL LCS TO BE REPLACED BY ROBS / RUBS.

 MARKETING AND DEVELOPMENT OF TERMINALS BY IR AND DFCCIL

www.dfccil.gov.in Projected Traffic on DFC Corridors

C+2 C+30 Freight Traffic (MTPA) C+5 Years C+10 Years Years Years -Traffic due to IR 235 264 300 523 -Additional Traffic (Non- IR) 150 280 489 1242 Total Traffic 385 544 789 1765

- Eastern DFC 163 277 427 956 - Western DFC 222 267 362 809 This will help increase rail share gradually from 30%-35% to more than 50%.

Source: Study by PWC. Summary of Achievements as on 30.07.2018

Award of contracts (on design build lump sum basis) • Overall 97.2% Tenders awarded (worth ₹ 51,906 crs) • WDFC - All Civil, Electrical and S&T contracts finalised. • EDFC – All Civil contracts finalized. Contracts worth ₹ 1524 crores under finalization.

Overall progress • Overall Financial progress (including land) – 48.1% • Overall Physical progress - 50.7%

Land acquisition – 98.3% (overall under section 20F) • WDFC – 99.1% • EDFC - 97.3%

• Use of Advance Technology in construction & maintenance • Track laying of 1445 km completed by Mechanised track Construction (NTC Machine) • OHE mast foundation using mechanized auguring mechanism & wiring using mechanized wiring train being done for the first time in India. 15 Achievements • First Double Stack Container Goods Train was run on Ateli Phulera section (190 km) on 15.08.2018.

16 Trends/Projections for Capital expenditure  Cumulative CAPEX upto 30.06.2018 - ₹ 39,139 crores.

25000

21803

20000

15711 15000 15000

13037 CAPEX 10000

6579 5488 4345 4163 4427 2150 crs 5000 (upto June’18) 1961 1237.6 521.1 925 500 0 0 0 0 0 Avg upto 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2013-14 Capex on Land CAPEX on Contract Projections

17 Section-wise progress - WDFC

Section/ Packages Civil/ Cost (Rs Land Physical Progress Financial (with Kms) Elec./ Crores) available / (%) Progress (%) S&T affected Patch 1. Rewari-Iqbalgarh CTP1- 2801 Civil 80.7% 72.3% CTP -1& 2 (639 Km) CTP2- 3898 99.70% Syste EMP-4- 3097 1/0.8 km 35.4% 28.9% m STP-5- 1780 2. Iqbalgarh- 99% Vadodara CTP-3(R)- Civil 4744.00 23.7% 19% (308 Km) 2/2.0 km 3. Vadodara-Sachin 99.7% Civil 2157.60 16.8% 15.6% CTP-13 (133 Km) 2/0.86 Km 4. CTP-12 Sachin- 94.8% Vaitarna (186 Km) Civil 2170.65 14/13.875 15.2% 10% Km 5. Vaitarana-JNPT 88.5% Civil 2949 9% 5.1% CTP-11 (102 Km) 9/12.5 Km 6. Dadri-Rewari Civil, 98.80% CTP-14 (127 Km) Elect 3799 14.9% 13.1% S&T 4/3.347 Km 18 Section-wise progress - EDFC

Section (with Civil/ Cost Land Physical Financial Kms) Elect/ (Rs availability/ Progress Progress S&T Crores) affected (%) (%) Patches 1. Bhaupur-Khurja Civil 3267 99.30% 87.6% 79.2% EDFC-1 (343 km) Elect & S&T 1497 0/0 km 46.4% 41.9% 2. Bhaupur- Civil 5087 42.7% 39.6% 99.40% Mughalsarai Elect & 1600 2/2.95 km 20.4% 13.6% EDFC-2 (402 km) S&T 3. Durgawati- Civil, Elect 750 100% Ready for commissioning. Sasaram (56 km) and S&T

4. Balance portion Civil 1450 49% 43.1% of Mughalsarai- 95.5% Civil, Track System work will be awarded Sonnagar (70 km) 355 22/14.75 km & System by August, 2018.

19 Section-wise progress - EDFC

Section (with Civil/ Cost Land Physical Financial Kms) Elect/ (Rs availability/ Progress Progress S&T Crores) affected (%) (%) Patches 5. Khurja-Dadri 87.20% Civil 511 24.2% 20.9% EDFC-1 (46 km) 9/10.26 km Contract will be awarded by Elect & S&T 188 October, 2018. 6. Pilkhani – Civil 1769 100% 25.2% 21.7% Ludhiana (179 km) 1/0.3 km Contract will be awarded by Elect & S&T 462 November, 2018. 7. Khurja-Pilkhani (222 km) Civil 1873 8.6% 5% 90.7% 2/5.5 km Contract will be awarded by Elect & S&T 524 December, 2018.

20 Commissioning Targets-WDFC

SN Sections Targets 1. Rewari-Marwar (432 Km) December 18 2. Marwar-Palanpur (207 Km) September- 19 3. Palanpur-Makarpura (308 Km) March -20 4. Makarpura-Vaitarna (313 Km) March - 20 5 Vaitarna – JNPT (117 Km) March -20 6. Rewari – Dadri (127 Km) March -20 Commissioning Targets-EDFC

SN Section Target 1. Khurja-Bhaupur (343 km) November- 2018 2. Bhaupur-Mughalsarai (402 km) August-2019 3. Sonnagar – Mughalsarai (126 km) October- 2019 4. Khurja-Dadri (46 km) December-2019 5 Pilkhani – Sahnewal (179 km) March -20 6. Khurja – Pilkhani (222 km) March -20 21 State-wise affected Land Patches

Name of Length Total Affected No of State of DFC Area Patches length Area (in KM) (in Ha) (in KM) (in Ha) Uttar 1077 4200 41.51 125 56 Pradesh Maharashtra 177 444 30 50 22 Bihar 100 571 2 4 3 Rajasthan 567 1956 2.58 5 3 Gujarat 565 2453 0.58 7.8 2 Punjab 88 260 0 0 0 Haryana 248 1044 0 0 0 Total 2822 10928 76.67 191.8 86 Affected patches include land legally acquired but possession not taken.

22 BENEFITS OF IMPROVED DESIGN IN TRANSPORT LOGISTICS

 Faster, higher and longer due to higher speed, train load & throughput.  Quantum jump in transportation capacity: both corridors capable of running 120 trains each way.  Providing connectivity to major ports of Gujarat & JNPT in Maharashtra  Scheduled time tabled trains- supply chain management  Induction of modern technology in construction, maintenance & train operation.  Improved Safety features by providing TPWS

 DFC to save 457 Million Tonne of CO2 emission over 30 years period (as per study conducted by Ernst & Young through World Bank). ◦ Part of India’s commitment in COP 21 to reduce emission intensity by 32.6% in 2030 23 BENEFITS OF IMPROVED DESIGN IN TRANSPORT LOGISTICS  Decongestion of major highways  One freight train of DFC will accommodate 1300 standard Truck load of freight  Released capacity on IR available for  Augmentation and speeding up passenger services  Strengthening “Make in India” Initiatives  By improving logistics.  By creating an ancillary Rail equipment industry for DFC/Railway  Development of industrial hubs  DMICDC on Western Corridor  Plan for development of Industrial Corridor from -Dankuni along the Eastern Corridor  Employment generation  Direct/Indirect – 42,000 jobs being generated during construction.  Skill Up-gradation - Training for Enhancing employability of PAPs under CSR initiatives. DFC – A GAME CHANGER IN TRANSPORT LOGISTICS

 FASTER, HIGHER AND LONGER-SIGNIFICANT INCREASE IN ◦ AVERAGE SPEEDS OF FREIGHT TRAINS (FROM 26 KMPH ON IR TO 70 KMPH) ◦ VOLUMETRIC CAPACITY PER WAGON (WAGONS WITH HIGH PAY LOAD/TARE WEIGHT RATIO. ◦ THROUGH PUT PER TRAIN (INCREASE LENGTH OF TRAIN FROM 750 M TO 1500 M). ◦ DOUBLE STACK CONTAINER ON WESTERN CORRIDOR.  QUANTUM JUMP IN TRANSPORTATION CAPACITY  CONNECTIVITY TO MAJOR PORTS OF GUJARAT & MAHARASHTRA  SCHEDULE TIME TABLED TRAINS- SUPPLY CHAIN MANAGEMENT  INDUCTION OF MODERN TECHNOLOGY IN MAINTENANCE , TRAIN OPERATION.  LOW OPERATING COST

25 DFC – A GAME CHANGER IN TRANSPORT LOGISTICS

RAILWAY SYSTEM:-  INCREASE IN RAILWAY SHARE IN TRANSPORT SECTOR (30% TO 45%)

 INCREASED EARNINGS FOR RAILWAYS

 IMPROVED ASSETS PRODUCTIVITY

 RELEASED CAPACITY ON IR FOR AUGMENTATION AND SPEEDING UP PASSENGER SERVICES INDUSTRY/SHIPPERS:-  FASTER MOVEMENT OF GOODS

 GUARANTEED TRANSIT TIME ENABLING RUNNING OF FREIGHT TRAINS TO TIME TABLE

 VALUE ADDED SERVICES- SUPPLY CHAIN MANAGEMENT

 REDUCED UNIT COST OF TRANSPORT LOGISTICS DFC – A GAME CHANGER IN TRANSPORT LOGISTICS(Contd)

 Economic Growth – Not only Regional but National

• ECO FRIENDLY ENERGY EFFICIENT TRANSPORT SYSTEM

GREEN DFC - TO SAVE 457 MILLION-TONNE CO2 OVER 30YEARS PERIOD.

• CATALYST FOR GROWTH IN INDUSTRY AND ECONOMY  BACKBONE OF DFC USED FOR DEVELOPMENT OF DELHI MUMBAI INDUSTRIAL CORRIDOR AMRITSAR-KOLKATA INDUTRIAL CORRIDOR

 DEVELOPMENT OF LOGISTICS PARKS-3PL SERVICES

 Employment generation • DIVERSION OF ROAD TRAFFIC TO RAIL  HELP IN REDUCING CONGESTION ON ROAD  REDUCTION IN ACCIDENT & FATALITY  SAVING IN PRECISOUS IMPORTED FOSSIL FUEL Impact of DFC on Rail freight transport

 1 container train= 280 trucks  1 bulk cargo train= 500 trucks  Total 6 DFCs have been planned. 2 DFCs being constructed at a total investment of around USD 16 Billion  Likely completion of 2 DFCs: December 2018.  Eastern DFC (Ludhiana-Dankuni, 1839 kms): mainly for bulk traffic, passing thru Haryana, UP, Bihar & W.B.  Western DFC (Dadri-JNPT, 1483 kms): for container traffic, passing thru Delhi, Haryana, Rajasthan, Gujarat, Maharashtra  Western DFC: 130 trains per day per direction which translates to evacuation of 65 million TEUs per annum  Axle load on IR: 20.3 tons  Axle load on DFC: 25 tons (32 tons eventually)  Container trains on IR: 90 TEUs  Container trains on DFC: 400 TEUs Projected Traffic

• EASTERN DFC- FROM LUDHIANA TO DANKUNI VIA KHURJA, KANPUR, ALLAHABAD, MUGHALSARAI

• WESTERN DFC-FROM DADRI TO JNPT VIA REWARI, AJMER, VADODARA

• COMPRISE 22% OF TOTAL IR TRAFFIC & 38% OF TRAFFIC ON GOLDEN QUADRILATERAL.

• PROJECTED TRAFFIC IN 2036-2037

CORRIDOR In Million Tonnes In Billion NTKM

EDFC 251.0 290

WDFC 284.3 303 Commodity wise Non-IR traffic in FY 20 WDFC Originating EDFC Originating Total Traffic Commodity Traffic (MTPA) Traffic (MTPA) (MTPA) Cement 12 16 28 Cement Grade 5 2 7 Limestone Chemicals 0.65 0.03 0.68 Clinker 7 8 15 Coal 0 0.4 0.4 Domestic Containers 7 8 15 Edible Oil 0.8 0.4 1.2 Exim Containers 28 1 29 F&V 1.1 0.4 1.5 Fertiliser 0 - 0 Finished Steel 2 5 7 Iron & Steel Grade 0 1 1 Limestone Pig and sponge Iron 4 4 POL 6 3 9 Rice 4 7 11 Salt 2 - 2 Wheat 1 3 4 Non conventional cargo 5 1 6 Other Commodities 5 4 9 Total Traffic 86 64 150 Non-conventional cargo estimated on rail

Non-conventional cargo Expected Volumes (FY20)

Marble 3.2 MTPA Ceramics 1.9 MTPA Retail 1.4 MTPA Two wheelers 1.4 Mn Units Three wheelers 0.022 Mn Units Passenger cars 0.157 Mn Units Tractors 0.043 Mn Units Household Appliances 0.4 Mn CBM Hi-Tech Commodities 1.1 Mn Units Construction Equipment 0.347 Mn Units DFC in Railway Budget 2016-2017

Corridor Kms Projected Completion Traffic in Cost 2041-42 (MT) (Billion USD)

East – West Corridor 2328 Kms 1410 22.1 (Kolkata–Mumbai)

North-South Corridor 2327 Kms 962 22.9 (Delhi-Chennai)

East Coast Corridor 1114 Kms 1192 10.25 (Kharagpur-Vijayawada)

Total 5769 3564 55.25 MAJOR CHALLENGES

 REMOVAL OF LC GATES  TIMELY COMPLETION OF WORK BY THE CONTRACTORS  UPGRADATION OF FEEDER ROUTES  TIME TABLING OF TRAIN ON IR NETWORK AND SEAMLESS TRANSFER OF TRAFFIC  SAFETY OF TRAINS OF PARALLEL SYSTEM  REVIEW AND REWORKING OF PRICING STRETEGIES  DEVELOPMENT OF FREIGHT TERMINALS

www.dfccil.gov.in Container Logistics & Planning for Container Traffic & Facilitating e- Commerce

34 Global Logistics Market

 Globally approx. 75% of break bulk cargo being shipped is containerized, whereas in India it is around 50%.

 Global ranking of the world bank’s 2016 logistics performance index shows that India jumped to 35th rank in 2016 from 54th rank in 2014.

 Indian logistics industry is valued at USD 160 billion and is likely to touch USD 215 billion by 2020.

 Global logistics industry employs 40 million professionals and Indian logistics industry employs about 22 million.

 It has grown at CAGR of 7.8% during the last 5 years and is expected to grow at a CAGR rate of 10.5 %.

35 Global Logistics Market (contd.)

 India is one of the fastest growing economies in the world. And, to support the pace of the economy, the growth of the logistics and SCM industry is very crucial as it contributes to 13% of the country’s GDP.  For harmonisation of warehousing which plays a major role in the growth of the logistics industry, Government of India has brought GST into picture for an optimal and efficient supply chain planning.  Overall Port Container Throughput of 13.7 million TEUs in 2016-17 but just about 2% of global volumes. As per Industry estimates, by 2021-22 India would handle around 379 Mn Tn of containerized cargo (approx 20 million TEUs) per annum.

36 Global Logistics Market (contd.)

 Container handling capacity at Ports is planned to be increased to 47 million TEUs by 2020 (present 10.35). India handled around 14.68 million TEUs in 2017-18 at Major Ports.

 CONCOR, a major player in providing multimodal logistics solutions, handled around 3.53 million TEUs in 2017-18 through its vast network of 72 owned Terminals and 7 strategic Tie ups spread across the Country.

37 Overview

 Indian logistics industry is valued at USD 160 billion and is likely to touch USD 215 billion by 2020.

 Global ranking of the world bank’s 2016 logistics performance index shows that India jumped to 35th rank in 2016 from 54th rank in 2014.

 Indian logistics industry employs about 22 million people.

 It has grown at CAGR of 7.8% during the last 5 years and is expected to grow at a CAGR rate of 10.5 %.

38 Overview (contd.)

 The sector alone provides jobs to more than 40 million professionals across the globe and expected to create millions more in the coming years.  India is one of the fastest growing economies in the world. And, to support the pace of the economy, the growth of the logistics and SCM industry is very crucial as it contributes to 13% of the country’s GDP.  For harmonisation of warehousing which plays a major role in the growth of the logistics industry, Government of India has brought GST into picture for an optimal and efficient supply chain planning.

39 Overview (contd.)

 INDIA GDP – Around US$ 2 trillion, set to grow at 7-8% per annum

 Overall Port Container Throughput of 10 million plus TEUsBut just 1.6% of global volumes

With increase in merchandise trade, container traffic is poised to increase with passage of time.

40 Overview (contd.)

 Container handling capacity at Ports is planned to be increased to 47 million TEUs by 2020 (present 10.35).India handled around 14.68 million TEUs in 2017-18 at Major Ports.

 Globally approx. 75% of break bulk cargo being shipped is containerized, whereas in India it is around 50%.  CONCOR, a major player in providing multimodal logistics solutions, handled around 3.53 million TEUs in 2017-18 through its vast network of 72 owned Terminals and 7 strategic Tie ups spread across the Country.

41 Challenges for Logistics

 High Logistics cost

 Under developed material handling infrastructure

 Fragmented warehousing

 Lack of seamless movement of goods across modes

42 Trade

 India’s export basket, continues to rely on exports of primary goods and low-value, low-tech manufacturing goods.

 Agricultural products such as cotton, rice, tea, meat and spices continue to dominate the exports.

 A shift to exports of medium and hightech manufacturing products such as engineering goods is visible; however, their share in the total export goods lags behind China and other emerging economies.

43 Trade (contd.)

 India’s top 10 exports accounted for 59.4% of the overall value of its global shipments.

1. Gems, precious metals: US$42.6 billion (14.4% of total exports) 2. Mineral fuels including oil: $35.9 billion (12.1%) 3. Machinery including computers: $16.7 billion (5.6%) 4. Vehicles: $16.2 billion (5.5%) 5. Organic chemicals: $13.6 billion (4.6%) 6. Pharmaceuticals: $12.9 billion (4.4%) 7. Iron, steel: $11.7 billion (4%) 8. Clothing, accessories (not knit or crochet): $9 billion (3%) 9. Electrical machinery, equipment: $8.8 billion (3%) 10. Knit or crochet clothing, accessories: $8.3 billion (2.8%)

44 Trade (contd.)

 India’s top 10 imports accounted for almost four-fifths (78.2%) of the overall value of its product purchases from other countries.

1. Mineral fuels including oil: US$123 billion (27.7% of total imports) 2. Gems, precious metals: $74.4 billion (16.7%) 3. Electrical machinery, equipment: $46.9 billion (10.6%) 4. Machinery including computers: $36 billion (8.1%) 5. Organic chemicals: $18 billion (4%) 6. Plastics, plastic articles: $13 billion (2.9%) 7. Animal/vegetable fats, oils, waxes: $11.9 billion (2.7%) 8. Iron, steel: $10 billion (2.2%) 9. Optical, technical, medical apparatus: $8.4 billion (1.9%) 10. Ores, slag, ash: $5.9 billion (1.3%)

45 Trade (contd.)

 Over three-fifths (61.3%) of Indian exports in 2017 were delivered to the above 15 trade partners. 1. United States: US$46.1 billion (15.6% of total Indian exports) 2. United Arab Emirates: $30 billion (10.1%) 3. Hong Kong: $15 billion (5.1%) 4. China: $12.5 billion (4.2%) 5. Singapore: $11.6 billion (3.9%) 6. United Kingdom: $9 billion (3%) 7. Germany: $8.2 billion (2.8%) 8. Vietnam: $8.1 billion (2.7%) 9. Bangladesh: $7.2 billion (2.4%) 10. Belgium: $6.2 billion (2.1%) 11. Italy: $5.7 billion (1.9%) 12. Malaysia: $5.5 billion (1.9%) 13. Nepal: $5.5 billion (1.9%) 14. Netherlands: $5.4 billion (1.8%) 15. Saudi Arabia: $5.2 billion (1.8%)

46 Trade (contd.)

 Positive demand in Europe, North America, South American economies, as well as rising imports from China tethered the container traffic growth at Indian ports.

 Trade with western countries continues to dominate as India’s export market with a share of 72% of the country’s total exports.

 Imports from western countries are gradually declining and decreased from 59% in 2011 to 51% in 2016.

 Import from eastern countries reached 49% in 2016 from 41% in 2011.

47 Trade (contd.)

 The market share of major ports declined from 92% in 2005 to 63% in 2016 while market share of non-major ports collectively surged to a whopping 37% in 2016 from 3% in 2005.

 On the west coast, JNPT that had a share of 66% traffic back in 2010 slipped to 48% by 2016. On the other hand, Mundra expanded its share from 18% to 35% during the same period.

 On the east coast, Krishnapatnam and Katupalli that started operations from 2013, currently hold a market share of 5% and 8% respectively while Chennai’s share plummeted from 52% to 41%

48 Modal Split & Assessment (contd.)

 Rail -The backbone ◦ Containerization had significant impacts on rail transportation and spurred the development of intermodal rail services that are specific to rail. ◦ Indian Railways carry 36% of freight traffic in India in train km terms, as compared to 23% in China, 48% in USA and only 10% in Europe. ◦ More than 60,000 kms of tracks ◦ Carries more than One Billion MT cargo every year ◦ 60% of rail freight traffic is carried on 16% of rail route kms. ◦ Railways handled more than 1.16 Billion tons of freight in 2017-18 and is poised to grow further. ◦ Delhi-Mumbai route is working on more than 100% line capacity utilization.

49 Modal Split & Assessment (contd.)

 Road/Truck :- ◦ Trucks are highly flexible vehicles able to carry almost every types of cargo over short to medium distances. ◦ Package trucks are commonly used in urban freight distribution since they carry a variety of cargo (in boxes or pallets) ◦ Less than truckload (LTL) carriers usually consolidate and deconsolidate loads coming from different customers, which is common in the parcel carrying business. ◦ Truckload (TL) transportation carries large volumes that have been broken down into the largest possible truck load unit; several truckloads are required to fulfill an order. ◦ Trucks using chassis are able to carry domestic and ISO containers (20 and 40 feet).

50 Modal Split & Assessment (contd.)

 India has second largest road network in the World with 41 lakh kms roads criss-crossing the subcontinent.  Roads carry around 57% of freight traffic.  National Highways: 1.7% of total road network  State Highways: 3.6% of total road network  Major district roads: 6.5% of total road network  Other district & rural roads: 88% of total road network  Majority of freight traffic is carried on 12% of road network.  Share of road in freight traffic has grown from 14% to 57% from 1951 to 2013. Modal Split & Assessment (contd.)

 Maritime. ◦ Through the application of the principle of economies of scale maritime shipping has developed specialized ships to carry break bulk, dry bulk, liquids, vehicles (RoRo) and even liquid natural gas. ◦ Container shipping has also become a dominant maritime modal option supporting commercial transactions with multiple origins, destinations and cargo owners. ◦ The standard ISO containers of 20 and 40 feet are the main unit sizes, which has been adapted to carry refrigerated goods (reefers) and even liquids (tank containers). ◦ The dry maritime container is the most dominant container cargo unit.

52 Modal Split & Assessment (contd.)

 Air ◦ Air packages are generally carried in unit load devices, on dedicated freight planes (freighters).

◦ Heavy loads, such as vehicles, require specialized cargo planes and are commonly used by the military and for emergency deliveries.

53 Modal Split & Assessment (contd.)

 Inland / Coastal ◦ India has an extensive network of inland waterways in the form of rivers, canals, backwaters and creeks. ◦ Of the total navigable length of 14,500 km, 5200 km of the river and 4000 km of canals can be used by mechanized crafts. ◦ India has recognized 106 waterways of which 6 are declared as national waterways. ◦ Economic viability of a waterway to carry traffic as an alternative to rail and road depends on its length which should be a minimum 500 km and 250 km for both cases respectively. ◦ Domestic waterways are cost effective as well as environmentally friendly means of transporting freight, For eg:- cost of moving coal via coastal shipping is one-sixth of the cost of moving it by railways.

54 The External Environment

Movement of bulk commodities is one of the major responsibilities of India's transportation system. Thermal coal alone accounts for around 61 percent of the freight volume on the Indian Railways and 24 percent of the seaport freight mix. Water currently contributes less than 10 percent to India's modal mix. China uses its inland waterways to transport raw material and finished goods between Eastern and Western provinces; water contributes 24 percent to China's freight modal mix. Australia carries 17 percent of goods through coastal shipping. In Germany, 11 percent of goods are moved through inland waterways and coastal shipping. India is one of the fastest growing major economies in the world with an expected GDP growth rate of 7.5% in 2015-16 India's long coastline of 7,517 km and a navigable inland waterways of 14,426 km offers immense potential for development 4th most attractive FDI destination in the World as per UNCTAD The External Environment (contd.)

 Over the last decade, seaborne trade has grown at twice the global growth rate of 3.3%  Maritime Container trade has grown at 6.5%, which is higher than the world average of 5.4% over the past 10 years (FY 2005 - 2015)  Cargo traffic at Indian ports has doubled to 1 billion tonnes per annum over the last decade (FY 2005 - 2015) and is expected to reach 1.7 billion tonnes per annum by 2022  US$ 2.6 Bn INVESTED IN Ports and Shipping sector between 2011 and 2014.  150 + projects identified in Indian maritime sector offering numerous investment opportunities India with long coastline, spanning 7516.6 kilometers, forming one of the biggest peninsulas in the world. It is serviced by 13 major ports (12 government and 1 corporate) and 187 notified minor and intermediate ports.

These ports account for nearly 90% (by volume) of India’s international trade. Yet, coastal shipping accounts for only 6-7 per cent of the country’s total domestic freight (on a tonne-km basis). Drivers for container trade growth

 The future of container growth in India is bullish in the wake of various policy initiatives such as Make in India, Goods and Services Tax (GST), Digital India, new Foreign Trade Policy and port linked infrastructure projects.

 New Foreign Trade Policy (FTP):- Under the new Foreign Trade Policy (2015 – 2020), India aims to increase its share in the global trade to 3.5% by 2020. ◦ Incentives to agricultural exports and extension of the same under Merchandise Exports from India Scheme to units in SEZ are part of the new FTP.

58  Infrastructure projects linked to port:- Multiple infrastructure projects, eyeing to improve India’s logistics efficiency and hinterland connectivity, will boost the containers business in India.

◦ Multi-modal terminal under Jal MargVikas project:-  170 crore multi-modal terminal at Varanasi, under the Jal Marg Vikas project that will open before December 2018 will be a major logistics hub connecting North India to North East India.

 The government will also develop 35 multi-modal logistics parks for freight aggregation and distribution, multi-modal transportation and warehousing.

59 ◦ Port based multi-product SEZ at JNPT:-  First of its kind, a port-based SEZ at JNPT will be developed with Free Trade Warehousing Zone, Engineering Goods sector, Electronics & Hardware sector and Pharma sector.

◦ Dedicated Freight Corridor (DFC):-  DFC will provide logistics support for the Make in India initiative. Two of the three DFCs are scheduled to be operational in the next two years. DFC will reduce the inland transit time significantly.

◦ Sagarmala programme:-  The Indian government is implementing the Sagarmala programme in phases, spanning over 20 years from 2015-35.  Four hundred and fifteen projects have been identified for port modernisation, new port development, port connectivity enhancement and port linked industrialisation

60  Proposed transhipment hubs in the south:- ◦ The government has approved ₹ 27,000 crore port project at Enayam.

◦ The port is expected to become a gateway port for India by shifting containers that are currently transhipped at Colombo or South East Asian ports such as Singapore or Port Kelang.

◦ This will act as transhipment hub for cargo from Bangladesh and Myanmar, which are currently being transhipped at Colombo or other South East Asian hubs.

◦ The ₹7,525 Vizhinam port, currently being developed by Adani that enjoys a natural draft of more than 20 metres is another port that will compete as a transhipment hub.

61 New Initiatives-DPD

 The government's new initiative Direct Port Delivery (DPD ) to reduce dwell time and transaction cost for the shippers could make some substantial savings of time and money for importers.

 With DPD, importers can bypass clearances with shipping lines, custom house agents, Customs, consignees and CFS operators through a streamlined procedure, allowing import containers to be delivered to the end user directly at the port with an average dwell time of only 1.5 days from 9-10 days taken earlier.

62 Container Movement by Rail

TIMETABLED TRAINS

 Dadri – Kathuwas & TKD-Kathuwas Daily Timetabled Trains started from 27.10.2016 to Mundra via Khatuwas called Link Express

 Time Tabled Cargo Express in Domestic Circuit started between:- TKD - TNPM, TKD – WFD, TKD – CMCN

DOUBLE STACK TRAINS

 Rationalisation of rail freight with increased Double stack Container Train running, thus reducing the Logistics cost and passing the benefit to Customers

 As against 332 Double Stack Rakes run in 2015-16, 938 Rakes were run in 2016-17

 More than 150 Double Stack Trains being run per month

63 Movement of International Cargo by Railways on Indian Frontiers India – Rail Traffic

 Regulated by a Bilateral agreement signed in 1976, extended in 1999, and then reviewed in 2001. Now being extended every 3 years.  Agreement on “Rules of Interchange between India and Pakistan” applicable primarily to freight traffic. India-Pak Passenger Traffic

running bi-weekly between and via since 1976.  IR running a link service between Delhi and Attari as a feeder service.  running weekly between (Rajasthan, India) to Zero Point station near Khokhrapar (Pakistan) every Saturday.  IR running a weekly link service between and Munabao for international travellers.  Rake sharing for six months by each country for both trains (Samjhauta and Thar Express).  Special trains for pilgrims India-Pak Parcel Traffic

 Agreement provides for movement of parcel traffic between Amritsar and Lahore.  10 freight (BCN) wagons loaded with parcel traffic attached to each trip of Samjhauta Express at Amritsar and taken upto Lahore, and vice versa in reverse direction.  From Pakistan: dry fruits, surgical instruments, finished leather, etc.  From India: machinery parts, tyres, tubes, books, dyes, cardamom, chemicals, fabric, etc. India-Pak Freight Traffic

 Freight trains run between Amritsar and Lahore via Attari.  Loading/unloading of consignments done at Amritsar and Attari.  From Pakistan: Cement, rock salt, chemicals and drugs, tools, cotton, carbon, etc.  From India: De-oiled cake, red chillies, chemicals, seeds, rubber, tamarind, spices, yarn, etc. India-Bangladesh Rail Traffic  Inter-Governmental Railway Meeting (IGRM) held annually.  Indian Railway Conference Association (IRCA) holds periodic meeting with Bangladesh Railways to settle interchange issues.  India has a Railway Advisor in the High Commission of India in Dhaka to coordinate with Bangladesh Government on a regular basis.  India has committed a soft loan of USD 2 billion for rail sector for Bangladesh (20 year loan period at 1% interest). India-Bangla Rail Connectivity

Indian Railhead Bangladesh Gauge Railhead Gede Darsana BG Petrapol Benapol BG Singhabad Rohanpur BG Radhikapur Birol BG Mahisasan Shahbazpur DG-Const Haldibari Chilahati BG-Const Agartala Akhaura DG- new Belonia Feni DG-survey India-Bangla Passenger Traffic

between Kolkata-Dhaka runs four days per week.  Only air-conditioned coaches provided.  Enters Bangladesh via Gede.  between Kolkata-Khulna runs weekly, entering Bangladesh via Petrapole- Benapole.  Both services very popular, and largely patronised by senior citizens and Bangla patients seeking medical treatment in India.  Customs/immigration done end-to-end respectively at Kolkata and Dhaka/Khulna. India-Bangla Freight Traffic

 During 2017-18, an average cargo of 143655 tonnes per month made over to Bangladesh, with a high CAGR.  Average of 92-95 freight rakes used for this export traffic from India.  Export traffic from India: stone/ballast, de- oiled cake, fly ash, foodgrains, etc.  No freight traffic from Bangladesh to India, except occasional consignments for Nepal coming by sea to Bangla ports and onward by rail route to Nepal via India. India-Bangla Container Traffic

 An agreement between CONCOR and Container Company of Bangladesh Ltd. (CCBL) for cooperation signed in April 2017 (in presence of both PMs) and all modalities including fixation of tariff completed (from Darsana to Banga bandhu West and from Darsana to Kamlapur ICP, Dhaka).  Containerisation will boost export traffic from Bangladesh by rail (especially RMG), and from India primarily white goods and CKDs of automobiles. India-Nepal Rail Connectivity

 Existing rail connectivity between Raxaul- Birganj section after operationalisation of ICD at Birganj.  Rail operations between Raxaul-Birganj governed by Rail Services Agreement signed between India and Nepal. India-Nepal Rail Connectivity Projects  Jogbani-Biratnagar – Length is 18.6 km, target date of completion is December 2018, of which Bathnaha-Nepal Customs Yard (6 km) will be operational in October 2018 (for freight services).  Jayanagar-Bijalpura – Length is 68.7 km, target date of completion is December 2019, of which Jayanagar-Kurtha (34 km) will be operational from October 2018 (initially for passenger services).  Both projects have been dependent on timely handing over of land by Government of Nepal, and issues in this regard have been cropping up time to time. Surveys for New India-Nepal Rail Projects From To Distance (India) (Nepal) (km) Nepalganj Road Nepalganj 12 (Uttar Pradesh) Nautanwa Bhairahawa 15 (Uttar Pradesh) New Jalpaiguri Kakarbhita via 46 (West Bengal) Panittanki Kushinagar Kapilvastu Survey in (Uttar Pradesh) progress THANK YOU [email protected]