RAIL FREIGHT: A STRATEGIC SOLUTION TO SUPPLY CHAIN DISRUPTIONS

For companies mapping out risk scenarios, rail is turning into a form of portfolio diversification. According to the National Rail Plan of India, despite possessing an extensive rail network, the current share of rail in the country's freight mix is approximately only 26-29 per cent. However, the policies outlined in the National Rail Plan aim to increase this percentage to 40 per cent by 2030.

- An article by Vikash Lohia, Dy. Managing Director, Jupiter Wagons

Globally, supply chains face uncertainty, which compels companies and governments to reconsider the fundamental structure of logistics. Freight costs have surged due to the closure of key Red Sea shipping lanes, congestion at European ports, container shortages, and volatile oil markets. India, which historically relied on road transport for nearly three-fourths of its inland freight, is now making a deliberate turn toward rail as a structural hedge against disruptions.

DFCS: DECONGESTING ROADS & PORTS

At the core of this shift are the Dedicated Freight Corridors (DFCs). These are high-capacity electrified tracks built solely for cargo, designed for speeds of 100 km/h, axle loads of 25 to 32.5 tonnes, and the ability to run long-haul, double-stack container rakes.

This type of infrastructure is not an isolated concept. Historically, the United States has used the heavy-haul railways operated by Burlington Northern and Union Pacific to absorb shocks in West Coast ports. Similarly, Germany has also established intermodal corridors for its Mittelstand exporters. Meanwhile, in China, too, the Trans-Eurasian freight rail has provided an alternative to maritime chokepoints for over a decade. India’s network, though younger, is being configured along these lines to position rail as a tool for supply chain continuity rather than an ancillary option.

In FY 2024-25, Indian Railways carried 1,617.38 million tonnes of freight, representing a 1.68 per cent increase over the previous year.