The Hindu Business Line : `We are the leanest, but most profitable'

Till March 31, 2003, Bilaspur was the largest freight-loading division of the then South Eastern Railway (SER), accounting for over 40 per cent of SER's total originating freight traffic. From April 1, 2003, Bilaspur became the headquarters of a new railway zone, South East Central Railway (SECR). Predictably, today, SECR, complete with three divisions located at Bilaspur, Nagpur and Raipur, is the largest freight-loading and the highest revenue-earning zone of the Indian Railways. Mr Pramod Kumar, General Manager, who has been heading SECR since inception, recently discussed with Business Line the various issues facing the Railway.

Excerpts from the interview:

Isn't South East Central Railway the largest freight-loading and highest revenue-earning division of the Indian Railways (IR)?

Yes. In 2004-05, we handled 92.52 million tonnes (mt), representing 15.37 per cent of the total originating freight traffic of 601. 8 mt handled by all the zones put together. Our revenue earning during the period at Rs 6,372 crore, out of Rs 47,161 crore earned by the IR as a whole, represented 13.7 per cent, also the highest.

How big is your zone?

In terms of track kilometres, our share at 4,773.63 represents 3.8 per cent of the country's total and our workforce of 45,000 represents three per cent of the total workforce of the IR. We are, perhaps, the leanest of all zonal railways and, yet, with an operating ratio of 55.94 (2004-05), most profitable.

Is freight the major source of revenue?

Yes. Of our total earning of Rs 6372 crore in 2004-05, the share of freight was Rs 5,993.77 crore, representing 19 per cent growth over the previous year's Rs 5,037.62 crore. Our earnings from passenger services amounted to Rs 252.09 crore (Rs 229.63 crore), up 9.78 per cent.

Which one is the most important item of your freight traffic?

Obviously coal, accounting for more than 70 per cent of our total freight traffic. In 2004-05, we handled 66.8 mt of coal (out of a total of 92.5 mt) compared to 58.18 mt (out of a total of 83.02 mt) in 2003-04. We serve two major coal companies — South Eastern Coalfields Ltd (Korba and Central India coalfields) and Mahanadi Coalfields Ltd (Ib Valley). Our daily wagon loading of coal is over 8,000 (in terms of four-wheelers), out of the total of 11,000.

What is your target for 2005-06?

Initially, when Indian Railway's total freight traffic target for 2005-06 was set at 635 mt, our target was fixed at 100 mt, but internally, we set our target at a higher level of 106 mt.

Subsequently, Indian Railway's revised upwards its total target to 700 mt and with it our target to 106 mt. But, internally, we did not revise our target. We decided to stick to 106 mt.

Why?

The reason is simple. With the extant infrastructure, we are just equipped to handle 106 mt without batting an eyelid. Any further increase will strain our existing facilities.

Coal will continue to be the mainstay...

Yes. The Railway Board wants us to handle 72.69 mt of coal traffic this fiscal but, internally, we have decided to handle more, about 74.4 mt.

Will it not strain your...

Most probably not. We will make some internal adjustments such that the total traffic remains unchanged at 106 mt.

Do you still think that the coal target for the current year is achievable despite the not-so-satisfactory performance in the first quarter?

Every year, the performance remains sluggish in the first two quarters, only to bounce back in the third and fourth. This is true of the economy as a whole. This year will no exception. The shortfall from the targets in the first two quarters will be more than compensated in the last two quarters. But, then, I must also concede that there are certain genuine areas of concern with regard to freight loading. For example, there are reports of coal shortages all over the country, so much so that along with steel plants, the power houses too are being encouraged to import coal. If coal imports rise, the Indian Railways will benefit, but not my zone.

There is another point. Indian Railwaysas a whole, and with it SECR too, hasgeared itself to handle the projected increase in freight traffic. We have created additional capacity. However, the increased production of coal companies is not enough to use fully the additional capacity created by us. The coal companies might be producing as per their own targets which are not enough to help us meet our loading targets.

The work on many new coal projects is held up on grounds of environment protection. The coal seams identified for excavation in forest areas cannot be touched. The Railway Ministry is believed to have taken up the matter at the highest level.

Evicting people from land identified for mining and arranging for their rehabilitation has delayed work on many coal projects in several States. The Government has to take a total view of the situation after considering all aspects.

What about other commodities?

We transport cement (8.92 mt in 2004-05) and the production of the cement plants located in areas served by our zone is also increasing. But we do not stand to benefit much from the increased production, bulk of which is consumed within the State. For short movement, road transportation is ideal.

We handle steel items and raw materials for steel plant. In fact, we cater to the requirements of Bhilai Steel Plant exclusively. But steel as an industry, being subject to cyclical fluctuations, often causes concern to us. For example, the earlier boom situation is no longer there. Also, with several world leaders in steel planning to have manufacturing facilities here, the competition is going to intensify. The future appears uncertain.

What about new projects?

We have pushed hard the implementation of projects sanctioned as early as 1996-97 and 1997-98 but not implemented. In 2004-05 we spent Rs 367 crore on new projects and plan to spend Rs 426 crore this fiscal. The projects sanctioned for the current fiscal include gauge conversion between Chhindwara and Nagpur (149.52 km), track doubling between Salka Road andKhongsara with a flyover at Bilaspur and construction of Bhilai-Durg third line (13.15 km). The survey work has been sanctioned for third line between Durg and Nagpur, and Jharsuguda and Champa, and conversion of Raipur-Dhamtari and Tirodi-Katangi narrow gauge.

The capacity enhancement work would include additional loops at Brajarajnagar, Bhilainagar, Bhupdeopur and Kalamuna; development of goods shed at Kotarlia; goods terminal at Bhilai; electrification of Mandir Hasaud including yard, and interlocking of level-crossing gates in Bilaspur division. The Rs 45-crore modernisation of the Bilaspur yard should prove extremely advantageous. On the signalling and telecom front, optical fibre cable is being laid between Salka Road and Anuppur (110 km) and between Anuppur and Katni (110 km).

How serious is your IT initiative?

Very serious. For the first time for any zonal railway, we have set up an in-house computer training centre, making it mandatory for employees at all levels, including Group D and security personnel, to undergo relevant training. We have created massive data transmission capacity. In MIS, we have made significant headway. The operations of commercial and personnel departments have been computerized and the materials management package developed by Central Railway is already in place. In short, wide use of IT has already started in SECR.

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