Dedicated Freight CorridorSocial Costs and Benefits

Sesh

INTRODUCTION• Biggest ever project in Indian infrastructure sector

• Undertaken by Ministry of Railways

• LT strategic plan – construction of high-capacity +

high-speed DFCs along the golden quadrilateral and its

diagonals

OBJECTIVES OF DFC PROJECT

• To facilitate speedier & smooth transportation of goods at

lesser transport cost and lesser time

• To increase the railway transport share within the

transport sector

• Ensure sustainable growth in Indian economy

PHASE 1Mumbai – Delhi (Western DFC)

Delhi – Kolkata (Eastern DFC)

WESTERN CORRIDOR

DELHI – HARYANA –

RAJASTHAN – GUJARAT –

MAHARASHTRA

EASTERN CORRIDOR

PUNJAB – HARYANA – UP

–

BIHAR – WEST BENGAL

PROJECT FUNDING

WESTERN CORRIDOR• Debt funding Govt. of Japan funds 67%of construction costbetween Rewari and

Vadodara• Equity fundingMinistry of Railways

EASTERN CORRIDOR• Debt FundingWorld Bank - 725 km

sectionbetween Khurja andMughalsaraiAsian Development Bank –remaining single lineportion between Ludhianaand Khurja• Equity FundingMinistry of Railways

PROJECT COST – Rs. 28000 Crore (RITES)

ECONOMIC BENEFITS FROM DFC

• Economic benefits from cost savings of rail over road

transport

• Economic Costs “With the project”

Cost of construction of DFC - up gradation cost of

rail feeder routes - O&M costs incurred for hauling

the traffic - Inventory cost: The costs incurred for

the cost of goods detained during transit period.

• Economic Costs “Without the project”

Road Improvement Costs - Road Maintenance Cost -

Vehicle Operating Costs

SOCIAL BENEFITS FROM DFC• Environmental Benefits

Rail fuel efficiency is high compared to road – Low

gaseous emissions

• Savings in accidental costs

Rail transport is safer than road transport – less

accident cost

• Employment Generation

During construction and during O&M

• Increase in passenger demand

Improvement in punctuality in services

POSITIVE EXTERNALITIES- Creation of Logistic Parks

Multiple facilities for bulk commodities and storing

containers.

Other facilities like hotels, banks and entertainment

- Less Congestion

Current line cap. utilization – High

After commissioning of DFC – Low

- Creation of new industries, factories and businesses

Facilitate faster and scheduled transport of raw materials,

finished products

- Promotion of Agriculture, Forestry and Fishery market

Reduced travel times between the coastal areas and the main

inland area

NEGETIVE EXTERNALITIES- Impact on Truckers

Indian Railways share in freight transportation market

1951 – 89% 2008 – 30% Speed – 25 kmph

Highway truckers share in freight transportation market

1951 – 11% 2008 – 70% Speed – 40-50 kmph

After DFC, Indian railways speed will increase to 65-70 kmph

- Other impacts

Large scale land acquisition – Impact on livelihood of land

owners and business establishments – Common property

resources like Temples, water resources, cremation places and

graveyards

THANK YOU