REVENUE ENHANCING SCHEMES

SANJAY UPRETI

PAM

VARIOUS SCHEMES

• Own Your Wagon (OYW) Scheme

• Volume Discount Scheme (VDS)

• Leasing of SLRs

• Leasing of VPUs

• Station to Station Rates

Own Your Wagon (OYW) Scheme:

• This scheme was initially started in the year 1992

• Further modified in the year 1994• These lease charges are of the nature of

16% for the first 10 years and then• 1% for the next ten years. • IOC, Raymond Cement, Essar Gujarat,

IFFCO, ACC, L&T, etc.

Benefits

For the Railways: For the party:

•No funds needed for the acquisition of Rolling Stock

•No need of prioritising at the time of wagon allotment.

•A more or less fixed and committed traffic.

• Dedicated rakes.

•No waiting for rakes – less cost.

•Lease charges as an added discount.

Category A – Pure Lease

• The Indian Railways on quarterly basis pay annual lease charges in advance.

• The charges are 16% per annum for the first 10 years and then 1% for the next ten years.

Category B - Lease cum guaranteed clearance scheme

• In addition to benefits of Cat. A

• Indian Railways will enter into an agreement for guaranteed clearance of the mutually agreed specified quantum/tonnage of the specific commodity/product during leasing a specified period.

Category C – guaranteed clearance with special wagons:

• Lease charges will not be payable to owners of special wagons moving in dedicated circuits – Involving empty running in one direction

• A lump sum freight – Mutually agreed taking into account the

haulage, terminal, marshalling and other costs.

Purchase of wagons

Directly by the owner from the wagon builders approved by the ministry of Railways, subject to current IRS designs and specifications, inspected by nominated agency of the Indian Railways and on payment of design loan and inspection charges to the Indian Railways to 1.5% of the cost of the wagons.

Through the Indian Railways on payment of a service charge of 3% of the cost of the cost of the wagons which would cover design loan, inspection and administrative charges of procurement

VOLUME DISCOUNT SCHEMES

• The concept of volume discount scheme in freight rates was introduce from second half of the financial year 1998-99.

• The commodity cover were – Group I - Cement, Iron & Steel, Sponge iron,

clinker and sugar. – Group II - Iron or Line Stone, Dolomite and

Gypsum.

The benchmark

Type of party Benchmark

Normal Highest loading achieved during the same six monthly periods for the last 3 financial years.

New parties 15000 tones for both the groups for each six monthly period.

Parties with few months of traffic

Notionally based on the average monthly loading for the concerned months multiplied by 6.

Sugar traffic Actual highest loading figure during corresponding six monthly period

Premier customers

Highest of total dispatches during each half-yearly period of the last three years.

VARIOUS DISCOUNTS AVAILABLE

Group Incremental traffic over benchmark

Discount

I Up to 10% 8%

I 10% - 15% 10%

I Beyond 15% 12%

II Up to 10% 6%

II 10% - 15% 7%

II Beyond 15% 8%

CCM (FM), CCM (FS), CFTM and FA&CAO (WST)/(T) shall be formed Which shall monitor the operation of the scheme and process the requests of each party.

LEASING OF SLR’

• Front SLR’s

• Open tender – Highest bidder above reserve price.

• Multiple of 4 tonnes

• EMD – 5 days freight.

• Penal charges for overloading– 2 times the normal luggage fare charged.

STATION TO STATION RATES

• Party should commit a fixed amount of traffic between fixed pairs of points.

• GM has powers up to 10% reduction

• Commodity class should not be below 100

• Distance should not be below 200 KM’s

• .