Rs 30K-crore revenue eyed off 300 upcoming cargo terminals

Raring to expand its cargo handling ecosystem riding on the newly liberalised land-lease policy, the Railways has already identified 250 hectares (ha) of its land in 62 locations across the country where the 300 new Gati Shakti cargo terminals may come up in next five years.

With each cargo terminal enabling an additional revenue of Rs 100 crore — as per internal calculations by officials — the national transporter is eyeing a revenue of around Rs 30,000 crore in about five years’ time, enabled by the web of cargo terminals.

Over 90 companies are ready to set up cargo terminals and around 65 more have expressed interest, said Railway Minister Ashwini Vaishnaw.

The Railways has 62,000 ha of free land but a lot of it are narrow strips running parallel to tracks. Explaining the policy in detail, Vaishnaw said it was needed with the ultimate aim to bring down logistics cost in India.

“Hypothetically speaking, if all goods were transported by road, the logistics cost would be around 17-18 per cent of the GDP. Similarly, if all goods went by rail, that figure would come down to around 6-7 per cent. That’s the difference. For the first time after decades, Railways’ modal share in freight increased since last year. We need to encourage this shift to bring down logistics cost in the economy. The cargo terminals are important in that context,” he told reporters on Thursday, a day after the Union Cabinet approved long-term leasing of railway land at economical rates.

The minister said that the new policy has nothing to do with the proposed disinvestment of CONCOR, the market leader by a huge margin, in rail cargo handling business.

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Vaishnaw said that along with cargo terminals, his ministry was also in the process of firming up plans to set up hospitals on railway land. As reported by The Indian Express on Wednesday, the policy enables setting up of hospitals at nominal rate of Re 1 per square meter for 60 years in public-private partnership (PPP) mode.

“Many good hospitals have shown interest in this. The idea is that wherever there is vacant land adjacent to stations, we could think of setting up good hospitals there for the benefit of the local population,” he said.

The policy also stipulates that under exceptional, unavoidable circumstances, the Railways can take back the leased land for its own use, like fo multi-tracking and other operational needs. In such cases, it would give adequate notice as well as a compensation based on the investment of the lessee.

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