News Details

Freight rates hike to increase transaction cost, says BVC Logistics

Reaction to Rail Budget

The proposed hike in rail freight rates announced by the Union Railway Minister, Mr Suresh Prabhu, in the Railway Budget for 2015-16 will further increase the transaction cost, Mr Rajesh Neelakanta, Executive Director and CEO of BVC Logistics, said.

"The freight rate hike is expected to increase transaction cost further. In India, at 14 per cent, we have been at the higher end of the spectrum as compared to other countries which average at around 8.5 per cent. So expenditures will probably continue to remain high," he said.

In regard to the expectations for the private participation, no interesting encouragements have been made. However, the investment plan chalked out by the Railway Minister seems to bring some hope for the facility provision and better infrastructure planning by the Railways, he pointed out.

"Overall, the Rail Budget this year seems to be a clean-up operation which is relevant and much required given the current atmosphere in the Indian economy," the BVC Logistics chief noted.

Source : Exim News Service - mumbai, March 2

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