Access Charges to DFCCIL

 

Access charges to DFCCIL

• What is the Access charge ? 

• Indian Railways pays access charges to DFCCIL - Dedicated Freight Corridor Corporation of India Limited  for utilizing these corridors for freight transportation. The charges are designed to ensure cost recovery for DFCCIL while providing affordable and efficient freight services for Indian Railways. The DFCCIL is responsible for operating and maintaining the dedicated freight corridors (DFCs) in India. 

• New classification as per F2 - Finance Code Volume 2

• Erstwhile Demand No.09 (Operating Expenses - Traffic) Detailed Head 735

• Sub Major Head 07 - Major Head 3002 - Indian Railways Working Expenses - Commercial Lines

 

• Authority: RBA No.33/2024  - ACS - Advanced Correction Slip Number 11 to Finance Code Volume 2 dated 02.12.2024

Key Points:

1. Purpose: Access charges cover infrastructure usage, maintenance, and operational costs of the dedicated freight corridors.

2. Computation Basis:

• Charges are calculated based on parameters like gross tonne kilometers (GTKMs), train path allocations, and distance covered.

• DFCCIL aligns these charges to incentivize higher utilization and efficient operations.

3. Mutual Agreement: Rates are determined through a mutual agreement between Indian Railways and DFCCIL, periodically reviewed for adjustments.

4. Revenue Sharing: The access charges also support DFCCIL's financial sustainability, enabling repayment of loans taken for DFC construction.

5. Operational Benefits: The use of DFCs reduces congestion on existing passenger rail lines, ensures faster transit for freight trains, and promotes economic efficiency.

In conclusion, these charges foster collaboration between DFCCIL and Indian Railways, facilitating the development of a robust freight transportation network.

TAC - Track Access Charges

 TAC - Track Access Charges

• Definition: Charges payable by user for access to the Rail Network. 

 

• A Concession Agreement signed between DFCCIL - Dedicated Freight Corridor Corporation of India Ltd, an SPV - Special Purpose Vehicle and Indian Railways in 2014.  Under this agreement, Indian Railways will pay TAC to the DFCCIL for accessing the track constructed by the latter.

• TAC - Two part Tariff  (decided after examining the practices followed by different Railways of the world where ownership of infrastructure (i.e., DFCCIL) has been separated from the user of the infrastructure (i.e., Indian Railways & other Private users)

1.  Fixed Component (Depreciation, Cost of the Capital i.e., Interest)  - will be payable irrespective of volume of traffic

2. Variable Component (Traction charges, staff costs, material costs)   -  will be payable based on volume of traffic in terms of 000 GTKM 

  

• Part of these TAC, will be utilized by DFCCIL to pay back loans availed to develop Dedicated Freight Corridors to World Bank and JICA - Japanese International Cooperation Agency. 

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