The Indian Railways has mandated a substantial non-refundable fee for firms seeking to renew their container train operating permits. The fee structure involves a charge of INR 25 crores or INR 5 crores, depending on the type of permit held by the operator, for a renewal period of 10 years. This renewal follows the expiration of the original 20-year concession agreements that will end in 2026 and 2027.
The privatisation of the container train operating sector, initiated by the Ministry of Railways in 2007, saw the issuance of permits to 16 firms. These included major players such as Container Corporation of India Ltd (Concor), Adani Logistics Ltd, and DP World Rail Logistics Ltd, among others. The initial permits, issued for a fee of either INR 50 crores for pan-India operations or INR 10 crores for limited routes, have facilitated the growth of a diverse rail logistics network across the country.In response to queries from container train operators, the Railway Board clarified in a circular dated 18 June that operators desiring to renew their agreements must pay a fee equivalent to half of their original registration fee. This fee is required at the time of application for the extension of the concession agreement.The Ministry of Railways has further defined the Commercial Operations Date (COD) as either the second anniversary of the agreement date or the date when commercial operations began if prior to the agreement execution. For those operators whose commercial activities commenced before the two-year mark, the COD will be the date of the first Railway Receipt issued.
Operators must submit a formal request for extension along with the non-refundable fee and a copy of the first Railway Receipt. Additionally, they are urged to settle any outstanding dues to the Indian Railways to facilitate the renewal process.The substantial fee increase has raised concerns among container train operators. Many argue that the new financial burden could force some operators to cease operations. Given that haulage charges—set by the Railway Ministry—constitute up to 80 percent of operating costs, the additional fees for permit renewal are seen as a severe blow to an already margin-thin industry.The haulage charges, which cover the use of locomotives and tracks owned by the Railways, are a fixed cost that operators must factor into their pricing models. The decision to levy a significant renewal fee is expected to strain the financial viability of several firms, potentially leading to market exits and reduced competition.As container train operators brace for these new terms, the future of rail logistics in India hangs in the balance. The Railway Ministry’s decision is poised to reshape the sector, with long-term implications for the operators and the broader supply chain infrastructure.
