Connectivity Challenges: Addressing evacuation issues by enhancing port-rail networks

Addressing evacuation issues by enhancing port-rail networks

Today, the biggest challenge faced by Indian ports is evacuation. Although the major ports have single- or double-line rail connectivity, the routes to major destinations are still congested. In the case of non-major ports, while some such as Pipavav, Dahej, Mundra, Dhamra and Krishnapatnam have adequate first-mile connectivity, for the last mile, they face the same problems as major ports. The capacity constraint of Indian Railways’ (IR) network is the key issue that hinders the provision of adequate connectivity.

Indian Port Rail Corporation Limited

To provide enhanced rail evacuation systems to the major ports and non-major ports (if found to be viable), the Ministry of Shipping formed a special purpose vehicle (SPV), Indian Port Rail Corporation Limited (IPRCL). It was incorporated on July 10, 2015 under the Companies Act, 2013, with 11 major ports and Rail Vikas Nigam Limited (RVNL) as equity partners, for undertaking port connectivity projects. IPRCL has an initial authorised capital of Rs 5 billion and an initial subscribed share capital of Rs 1 billion.

The objectives of the SPV are to provide efficient rail evacuation systems and undertake projects aimed at enhancing last-mile connectivity at the major ports. IPRCL is responsible for the modernisation of evacuation infrastructure, and operations and management of internal port railway systems. It is also responsible for raising financial resources for funding port-related connectivity projects. IPRCL willalso assess inter-modal gaps in handling rail cargo by the major ports and develop suitable solutions to enable the seamless flow of cargo. It will also strengthen the implementation of the Sagarmala programme’s second pillar of improving port connectivity by undertaking dedicated port connectivity projects.

Experience so far

In December 2012, the Ministry of Railways (MoR) framed a policy, Participative Models in RailConnectivity and Capacity Augmentation Projects, for encouraging uptake of port-rail connectivity projects. The experience so far has reflected that for port connectivity projects, developers prefer the non-government railway or joint venture (JV) models.

So far, RVNL has formed six SPVs for providing port connectivity. Of these, Kutch Railway Company Limited and Bharuch Dahej Railway Company Limited are fully operational, while Krishnapatnam Railway Company Limited is partially operational. The projects under Haridaspur Paradip Railway Company Limited and Angul-Sukinda Railway Company Limited, both providing connectivity to Paradip port, are currently under construction. Meanwhile, Dighi Roha Rail Limited, the SPV formed to lay a rail line between Dighi and Roha in Maharashtra, has initiated the land acquisition process. Besides, the MoR has also formed two new SPVs with the JSW Group for providing connectivity to Jaigarh port and with Rewas Port Limited for connectivity to   Rewas port. Moreover, IR had formed two SPVs, Pipavav Rail Corporation Limited and Hassan Mangalore Rail Development Company Limited, to provide connectivity to Pipavav and Mangalore ports respectively. Both the lines are now fully operational.

At present, IPRCL has 88 projects (for major ports and Setu Bharatam) under its wing. Of these, eight projects have been completed, covering a total of 31 track km and entailing an investment of Rs 1.35 billion. These projects include the modernisation and upgradation of the existing railway network and upgradation of track nos. 10, 12, 14, 16, 18, 19, 20, 21, 22 and 23 at Kolkata port, laying of a new railway track west of Western Yard I and paving, and setting up a block loading platform at Chennai port, upgradation of platform nos. 2 and 3 in the marshalling yard at New Mangalore port, upgradation of railway line 1 and 2 and rail connectivity to the fourth terminal at the Jawaharlal Nehru Port Trust, and providing a direct connection between the ore exchange complex and western sector joining the naval armament depot curve (6 km) and connection of the dead-end line north of the research and development yard to the eastern grid (4 km) at Visakhapatnam port. Besides, IPRCL has initiated works on 19 projects. These include rail connectivity projects at non-major ports such as Jaigarh port (via an SPV of Konkan Railway with port promoters), Dighi port (via an SPV of port promoters with RVNL) and Machilipatnam port, among others. In addition, two major rail connectivity projects being promoted are the Indore-Manmad new broad gauge railway line project and the Jaisalmer to Kandla rail connectivity project.

Going forward

While a number of projects are on the anvil, the development of rail connectivity projects faces certain challenges such as slow and cumbersome process of approval, high capital costs, long gestation period and uncertainties of traffic/freight, among others. Going forward, to improve rail connectivity of ports, these challenges will need to be addressed. For this, the dedicated port rail corporation can help fast-track connectivity projects. This will not only help in increasing the percentage of cargo being evacuated via rail from the major ports but also meeting the objectives of Sagarmala.

Based on a presentation by Anang Pal Malik, Chief General Manager, Projects, IPRCL, at a recent India Infrastructure conference