Competition Among Railway Service Providers Reduces Fare

CONCOR Slashes Shipping Charges as New Private Company Starts Cargo Service

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Competition Among Railway Service Providers Reduces Fare

Om Prakash Khanal

September 16: Container Corporation of India (CONCOR), which used to enjoy monopoly for transporting cargo to Nepal, has slashed the shipping charges as soon as its competitor from the private sector started railway service to transport goods to Nepal.

CONCOR slashed the shipping charges for the first time after the private railway company arrived in Birgunj carrying containers following the amendment to the Nepal-India  Railway Service Agreement.

Issuing a notice on Wednesday, September 15, CONCOR reduced the fare from Kolkata port to Birgunj by 31 to 37 percent. Similarly, fares have also been significantly reduced for cargo transportation from Haldia port, to be effective immediately.

The 2004 Railway Agreement gave a monopoly to CONCOR, a subsidiary company of the Indian Railways, for providing cargo services to Nepal-bound goods. The Indian Railways had built a railway track to the dry port of Birgunj.

Nepal's private sector had been demanding amendment to the agreement, stating that the fares were being charged arbitrarily. Though the government had proposed for the amendment, the Indian side has been reluctant to revise it in the past.

Entrepreneurs say that the cut down in soon after the entry of a private railway company has confirmed that CONCOR had been charging arbitrarily for the freight services. 

CONCOR brings containers from Kolkata port to Birgunj and delivers the empty containers back to the yard.

The new fare for transporting goods up to 31 metric tons in a 20-feet container is IRs 39,856  while bringing 30 tons of goods in a 40-feet container costs IRs 58,008. Until,September 14, the rates were IRs 61,466 and IRs 85,198, respectively.

There has also been a massive reduction in fares based on the quantities of goods to be transported from Kolkata and Haldia ports. CONCOR has also reduced fares from Haldia port to Birgunj by 25 to 31 percent.

Eknarayan Aryal, the then Consul General of Nepal in Kolkata, who is currently a secretary of the Government of Nepal, had played a crucial role to remove paperworks at Nepali customs and increase competition in cargo services.

Aryal thinks Nepal's foreign trade can be made more competitive if the existing railway infrastructure, the only service available in Birgunj, is expanded to other border points as soon as possible and Nepal Railways brings its railways into operation.

At present, four companies including CONCOR have come forward to provide container services to Nepal. Pristine Logistics and Infraprojects Pvt Ltd, Pristine Valley's main Indian partner, is also set to launch the service in a few days.

According to Ishwar Raj Poudel, Nepal’s Consul General in Kolkata, the company has already started the process to provide cargo services from Kolkata. JM Buxi group, which operates ports and railways in India, is also preparing to transport containers to Birgunj, officials said.

Poudel said that decline in freight charges with the entry of private service providers is encouraging for Nepal's foreign trade, which should be utilized by Nepali entrepreneurs. 



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