Indian Railways opens vacant land for ecommerce cargo infrastructure boost
Indian Railways has revised its land lease policy to stimulate the growth of ecommerce cargo movement, paving the way for modern logistics facilities and sustainable trade.
Under the amended framework, the national transporter will now allow vacant railway land to be used for sorting, grading, packaging, and labelling units, a significant expansion of permissible activities. The move is aimed at increasing freight movement while boosting revenue streams through more efficient land use. According to senior officials, the previous policy permitted the use of railway land for general cargo facilities but lacked a comprehensive listing of supporting infrastructure. The updated guidelines explicitly cover warehouses, storage facilities, grinding units, silos, conveyor belts, decanting facilities, and allied infrastructure such as weighbridges, truck parking areas, and assembly centres.
This policy shift is expected to draw major interest from ecommerce firms, logistics players, and agri-based industries looking to optimise supply chains. Officials believe that the relaxation will help scale up the parcel business, which saw volumes rise from 31 million parcels in FY24 to 44 million in FY25. The Indian Railways holds approximately 490,000 hectares of land nationwide, of which over 8,800 hectares have been leased for various purposes. Under the revised terms, land can be leased for up to 35 years at an annual rate of 1.5% of the market value. The ownership of the land will remain with the Railways, ensuring that the asset continues to serve public interest while enabling commercial viability.
The policy aligns with the broader strategy to promote sustainable and efficient cargo transport. By encouraging the aggregation of goods and enabling last-mile connectivity through both rail and road networks, it aims to reduce dependence on long-haul trucking — a step that could significantly lower carbon emissions in the logistics sector. Experts point out that expanding rail-based cargo movement is crucial for reducing congestion on highways and curbing fuel consumption. Additionally, the creation of decentralised storage and handling facilities near railway hubs will help small businesses and farmers access markets more quickly, bridging the urban-rural supply chain gap.
The Railways has already rolled out initiatives such as the Cargo Aggregator Transportation Product and Joint Parcel Product-Rapid Cargo Services to diversify its freight basket. The new lease policy builds on these efforts by removing procedural bottlenecks and giving the private sector greater operational flexibility. While industry players have welcomed the announcement, they emphasise the importance of transparent allocation processes, strict adherence to construction quality, and integrating renewable energy solutions in the upcoming facilities. If executed well, this initiative could redefine India’s cargo landscape, making it more competitive, eco-friendly, and resilient to future demand surges.
