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Indian railway keen to establish auto hubs

The Railways also want freight train operators to set up such auto and ancillary hubs. The hubs will be allowed only at sites where setting up of such value-added facilities will attract sufficient additional traffic and is approved by the Railways.

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Market Press Release – June 9, 2010 6:00 am – Indian railway keen to establish auto hubs

With the export of cars from India is set to increase the Indian Railways is creating a number of auto hubs in an effort to augment infrastructure. This necessitated by the fact that a number of automobile manufacturers such as Maruti Suzuki, Hyundai and Volkswagen have decided to set up their global manufacturing hub in India. To speedily augment this infrastructure, the Railways is seeking the Public-Private-Partnership (PPP) route in this venture.

Ten locations have been identified. Two possible locations are Santragachhi and Shalimar in West Bengal. The other identified areas are Siliguri, Ranchi, Patna, Guwahati, Hosur, Palakkad, Ernakulam, Vijaywada, Chandigarh, Delhi Cantonment, Kharagpur, Chalapalli and Kalamasery.

According to the Society of Indian Automobile Manufacturers (SIAM), if this project is implemented successfully, the Indian Railways’ share of logistics can go up to 15 per cent in the next three-four years. The Finance Ministry has also deferred the implementation of service tax on motor vehicles carried by the Indian Railways, in an attempt to woo car manufacturers as the Indian Railways would have to compete with road carriers, who have the advantage of the first- and last-mile connectivity.

However, according to a policy paper by the Indian Railways, development of automobile and ancillary hubs will help automobile manufacturers to carry their traffic by rail in bulk and that these hubs will also assist in secondary distribution to consuming centres in the immediate catchment areas from such hubs. With Indian Railways inducting high-capacity auto carriers, the policy says, the Railways will add more rakes to provide for competitive freight structure.

The Railways also want freight train operators to set up such auto and ancillary hubs. The hubs will be allowed only at sites where setting up of such value-added facilities will attract sufficient additional traffic and is approved by the Railways.
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