The Ministry of Coal in India has embarked on a pioneering initiative known as Rail-Sea-Rail (RSR) with the objective of revolutionizing the transportation of domestic coal. This innovative multimodal approach seeks to seamlessly integrate rail and sea transport, offering a more efficient movement of coal from mines to ports and ultimately to end-users. By mitigating transportation costs and optimizing logistics, this initiative aims to contribute to improved overall efficiency in the coal supply chain.
Current Scenario and Challenges
In the fiscal year FY’23, a substantial 75% of the nation’s domestic raw coal dispatch was attributed to major coal-producing states like Odisha, Chhattisgarh, Jharkhand, and parts of Madhya Pradesh. Recognizing the surging demand for coal, the Ministry of Coal has set forth an ambitious goal of nearly doubling coal production in India with a Compound Annual Growth Rate (CAGR) of approximately 7.7% by FY’30. As such, the need for an effective coal evacuation system has become paramount.
Inter-Ministerial Collaboration for Effective Coal Movement
To address the pressing need for a robust coal evacuation system, the Ministry of Coal has established an Inter-Ministerial Committee (IMC) led by the Additional Secretary of Coal. This committee includes representatives from the Ministry of Power, Ministry of Railways, and Ministry of Ports, Shipping, and Waterways. The primary objective of this collaborative effort is to develop a comprehensive long-term plan for coal movement within the country. The IMC envisions railways playing a pivotal role in coal evacuation, with a targeted increase from the current 55% to 75% by FY’30.
Promoting Rail-Sea-Rail for Efficient Evacuation
The Ministry of Coal is actively advocating the augmentation of coal evacuation methods and diversification of evacuation routes. A key focus lies on the Rail-Sea-Rail (RSR) mode of transportation. The IMC has outlined strategic measures to promote RSR evacuation, aiming to elevate coal movement to 112 million tons by 2030, a significant leap from the existing 40 million tons. This approach carries several noteworthy advantages. Firstly, it alleviates congestion on the All-Rail Route by introducing an alternative evacuation mode. Secondly, it establishes opportunities for future exports through the infrastructure developed. Lastly, RSR stands out for its lower carbon footprint compared to traditional methods.
Coastal Shipping: A Game Changer
The coastal shipping mode emerges as a transformative force in India’s logistics landscape. Offering an economical and environmentally friendly solution for transporting goods, including coal, this mode has the potential to reshape the nation’s transportation industry. Efforts to enhance coal evacuation methods like RSR align with the goal of optimizing Southern and Western coastal ports’ capacities. This optimization paves the way for efficient coal transportation to powerhouses in states like Gujarat, Maharashtra, Karnataka, Goa, Tamil Nadu, Kerala, and Andhra Pradesh.
Optimizing Costs and Efficiency
A key driver of the Rail-Sea-Rail initiative is cost optimization. By adopting this approach, substantial savings are anticipated, potentially ranging from Rs. 760 to 1300 per ton in logistics costs for end-users located in Southern India. Notably, the total cost increment for transporting coal from MCL (Paradip) to Western/Northern TPPs is around Rs. 2500/ton over the traditional All-Rail Route, yet it remains more cost-effective than the total landed cost of imported coal.
Way forward
The Ministry of Coal’s relentless efforts to promote Rail-Sea-Rail transportation have yielded remarkable outcomes. Over the past four years, the transportation of coal through the RSR mode has witnessed substantial growth, soaring by approximately 125%. With India’s coal production projected to nearly double in the next seven years, the Rail-Sea-Rail mode stands as a pivotal alternative for seamless coal evacuation to consumption centers across the country. The IMC’s recommendations represent a holistic approach involving multiple ministries, collectively addressing the challenges of efficient coal evacuation.
UPSC Mains Questions
- How does the Rail-Sea-Rail initiative address the challenges associated with the efficient movement of domestic coal in India?
- What are the key benefits of the Rail-Sea-Rail (RSR) mode of transportation for coal evacuation, and how does it contribute to sustainable logistics?
- In what ways does the Inter-Ministerial Committee’s collaboration enhance the efficacy of the Rail-Sea-Rail initiative? What ministries are involved and why?
- How does the adoption of Rail-Sea-Rail impact the cost dynamics of coal transportation in comparison to traditional methods, and what implications does this have for end-users in different regions of India?
