Wednesday, June 17, 2009

Mangalore Railway Line Sees Slowdown In Iron Ore Traffic

The Hassan-Mangalore Rail Development Company, which started freight handling during a high economic growth period when there was a boom in iron ore exports, now seems to be witnessing the impact of the economic slowdown.

Formed as a project specific special purpose vehicle by the Railways and the Karnataka Government, the HMRDC Ltd commissioned the 183 kilometre stretch of railway line between Hassan and New Mangalore on May 5th 2006, for freight handling.

However, the initial 2 years of operations saw the line transporting 1.6 million tonne and 4.6 million tonne of freight in 2006-07 and 2007-08, respectively. During 2008-09, that is the 3 year of freight operation, it saw a slight fall in the traffic handling. It handled 4.51 million tonne of traffic during 2008-09. The composition of iron ore traffic to the total traffic, which was around 65% during 2007-08, came down to 55% during 2008-09.

The share of iron ore traffic is more than half in the total composition of freight traffic of HMRDC and the decline of nearly half a million in its handling during 2008-09 made its impact in the total freight traffic of the company.

Ms Sarala Balagopal director & CEO of HMRDC said that it handled 2.49 million tonne of iron ore cargo during 2008-09 as against 3.01 million tonne in the previous fiscal. She said the slowing down of the economy and reduced international demand for iron ore resulted in decrease in tonnage of iron ore transported by rail.

An analysis of iron ore cargo movement through the HMRDC line to New Mangalore Port and the total handling of iron ore fines at the port shows that iron ore through HMRDC line contributed 44.52% to the total iron ore fines handled at New Mangalore Port during 2007-08. The contribution came down to 30.66% in 2008-09. New Mangalore Port handled 8.12 million tonne of iron ore cargo during 2008-09 as against 6.76 million tonne in the previous fiscal.

Of the 183 kilometres of railway line under HMRDC, a stretch of 55 kilometres comes under the ghat section. This section between Sakleshpur and Subrahmanya Road has a gradient of one in 50. It has 57 tunnels with a total length of 10.98 kilometres. The Karnataka Government, union railways ministry, New Mangalore Port Trust, Mineral Enterprises Limited and Karnataka Rail Infrastructure Development Corporation are the stakeholders in the SPV.

Source: Steel Guru/Business Line

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