short Lead Traffic - Commercial Matters

 

Short Lead Traffic

• Sources: Rate Circular 16 of 2020 and  Corrigendum-1 to RC 16/2020 dt. 05.08.2020. Validity is extended from time to time. 

• Salient Features: 

• Up to 100 KMs

• Agreement Period: Maximum 10 Years

• Applicable for all Traffic (except Coal & Coke, Iron Ore, Military Traffic, Rail Material Consignments and Container Traffic )

• Permitted Distance slab and Freight Concession as follows,

Distance Slab	Freight Concession
0 -50 KM	50%
51 - 75 KM	25%
76 -90 KM	10%
91- 100 KM	NIL

• The applicable concession as mentioned above shall be given on Normal Tariff Rate (NTR).

• This concession shall not be available with any other concession. (except 6% concession on freight applicable to traffic booked to and from the NorthEast Frontier Railway (NFR)region).

• CRIS has developed necessary modifications in FOIS.

• The agreement shall have a clause of enhanced loading commitment supported with Bank Guarantee. Depending upon the commitment, the percentage concession may vary from the rates mentioned in above referred Rates Circular.

• Zonal Railways must assess the concession vis-a-vis the additional traffic and revenue projections to determine the rate of concession. 
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• Zonal Railways shall evaluate the fulfillment of committed traffic and revenue projections annually, and realize the unmet revenue from customer or from Bank Guarantee at the end of year. 

• Zonal Railway shall get the MIS report designed in TMS through FOIS/CRIS before effecting the agreements, so as to get data on traffic, revenue and concession given for assessment of performance. 

Objective of the Scheme

* To attract short-distance freight traffic from road transport to Railways.

* To make Rail freight competitive for nearby destinations where road transport has an advantage.

Practical Examples

Distance: 40 km

* Normal Freight = ₹100 per tonne

* Concession = 50%

* Freight Charged = ₹50 per tonne

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