Title - 3%25 hike in Rail Freight on busy season surcharge

The Railways has raised the busy season surcharge on cargo charges from 12% to 15% even as it deferred a decision on passing on a part of the burden of growing fuel costs.

A decision on raising the Fuel Adjustment Component (FAC) was slated to be taken by September 30.  In addition, the Railways were to receive a call on adding FAC to passenger fares. However, it has put off for now the decision on the politically sensitive fare issue.

Devi Prasad Pandey, Member-Traffic, Railway Board said, “The marginal boost in fuel surcharge was because of increase in various input costs for Railways, excluding fuel. We will take a call on implementing the Fuel Adjustment Component over the next few days.”

The revised fuel surcharge will come into effect from October 1. Traditionally, the Railways levies a busy season surcharge on freight traffic for nine months during the year, barring July to September.

The exceptions to the surcharge continued to be container volume and automobile volume. The move may have an inflationary effect if companies pass on the hike to consumers.

Another Railway Ministry official said, the recent 10% boost in dearness allowance for Government employees is likely to cost the Railways Rs 1,000-1,300 crore this year.