Indian railways, logistics sector need private players: Suresh Prabhu

Prabhu pointed out that the rail ministry's freight policy encouraged private partnership which would also generate employment opportunities.

Union minister for railways Suresh Prabhu called for private players to invest in the country’s railways and logistics sector at the third conference on logistics organised by confederation of Indian Industries (CII) in Panaji Wednesday, reported Time of India.

Opening the sector for private players would help railways cut debt and improve its turnover. In April 2017, Reuters reported railways had missed earnings targets for the third straight year, which added to its piled-up debt.

Hinting the government could not be the sole investor in the railways, Prabhu pointed out that the rail ministry's freight policy encouraged private partnership which would also generate employment opportunities.

"The strategy is to bring in private and public partnership (PPP) in the freight segment. It is time for the private sector to make investment in logistics. Unlike other sectors, this is the only sector where PPP is the perfect model. I can see huge growth coming in logistics from railways investment alone but to make it more viable, I think private sector must also come in," Prabhu said.

The union minister for railways also added the government has been exploring ways to promote multi-modal transportation systems that would aid logistics and economic growth.

"We need to have an integrated multi-modal transportation system, implemented. We are working very closely with the other ministries to make it happen. We are preparing a plan for 2030 and that plan will be applicable to 2050," Prabhu added.

According to the report, the multi-modal transportation plan will integrate various modes of transportation including roads, metro systems, bus service and water. The plan will also encourage private freight terminals and private rolling stock.

The railway ministry is also keen to boost its revenues by diversifying the freight cargo, according to Times of India.

"The railways have been traditionally doing business in major bulk cargo, that too in ten major commodities including ore and cement among others. It is important now that over a period of time, we need to develop and diversify the freight basket and to do that we need for small quantities of freight. And so now we will have to find out smaller quantity of cargo, which needs to be integrated, and for that the best way it can happen is through public private participation," Prabhu told at the conference.State minister for panchayats, Mauvin Godinho, agreed with Prabhu saying the Centre and the state were ready to support the private sector for developing Goa as a logistics hub.