Title - Railway freight revenue on the decline

Developments in the mining sector in Bellary, Hospet and Sandur in the past few years, which has been hit by the illegal mining scam, has resulted in a steep decline in the railway freight revenue of the Hubli Division, which is the main resource base for the South Western Railway (SWR) zone.This has come to light from information furnished by the Hubli Division in response to an application filed under the Right to Information Act by Y. Yamunesh, member of the Divisional Rail Users’ Consultative Committee.Iron ore exports from the area witnessed a boom in the international market from around 2002, when China emerged as a major player. As a consequence, freight earnings started moving up and it peaked in 2009-10, when it brought in Rs. 2,60,351.14 lakh out of the total earnings of Rs. 2,76,339 lakh.However, the downturn began with the ban imposed on export of iron ore in July 2010 by the State government in an attempt to curb illegal mining. This was followed by a total ban on all kinds of mining imposed by the Supreme Court, while hearing a public interest litigation filed by the Dharwad-based Samaj Parivartana Samudaya against illegal mining activities in forest areas, in July 2011

Comparison

As a result, over the years, the freight revenue from the movement of iron ore has declined drastically and touched Rs. 39,869 lakh, out of the total freight earnings of Rs. 1,87,434 lakh, in 2011-12.

Prior to the ban, about 27 rakes (one rake has 58 wagons for transporting about 3,850 tonnes of ore) used to move daily from the Bellary-Hospet section towards various ports, including Chennai, Visakhapatnam, Krishnapattanam, Karwar and Goa. This has come down to less than 10 rakes, that too plying for short distances, mainly to meet domestic needs.

As against the normal 27 rakes a day, less than 10 rakes were plying after the ban on exports. In 2010-11, the total revenue contributed by Bellary-Hospet section was Rs. 92,699.16 lakh. Revenue earnings further dipped in 2011-12 to Rs. 39,869 lakh from this section.

Iron ore traffic in this sector was being handled at 15 loading points, of which bulk handling was done at 10 points, including Torangal, Bannihatti, Kariganur, JVSL, Bellary (cantonment), Papinayakanahalli, Ranjitpur, Bellary, Ramgadh and Swamihalli. The prospects of any improvement in goods revenue earnings appear uncertain because, the ban on exports imposed by the State government is still in force. Moreover, the mining activities in the Bellary-Hospet-Sandur sector returning to its earlier state is unlikely at the moment, as only about 20 mines, listed in category A by the Supreme Court-appointed Central Empowered Committee, have been permitted to resume mining.

Apart from that, the State government has cancelled the lease given to 51 mines, which were included in Category C, as per the directions of the Supreme Court.

The mines listed in B category have been asked to implement reclamation and rehabilitation (R&R) plan and obtain all mandatory licences and clearances from the departments of Environment and Forest, before resuming their activities. Above all, there is a cap on the production of ore too, imposed by the Supreme Court.

From 27 rakes a day prior to the ban, the ore movement has dipped to less than 10 rakes now

The State government has also cancelled the lease given to 51 mines