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  • Q.3. “Indian Railways is the lifeline of the Indian economy.” Discuss the statement in the context of the three railway corridors announced in the Union Interim Budget, 2024.

    • 14,Oct 2024
    • Posted By : SPM Academy
    • 0 Comments
    • APSC2023
    • GS3

    Indian Railways, often referred to as the lifeline of the Indian economy, plays a critical role in driving economic growth, supporting trade, and connecting the country’s diverse regions. As one of the largest railway networks in the world, it is pivotal in facilitating the movement of goods and people, particularly in a cost-effective manner. In the Union Interim Budget 2024, the government announced the development of three new railway corridors — Energy, Mineral and Cement Corridors, Port Connectivity Corridors, and High Traffic Density Corridors — which aim to further strengthen the role of Indian Railways in economic development and climate sustainability.

    Significance of Indian Railways in the Indian Economy

    Indian Railways is essential for both freight and passenger movement, contributing to economic integration, job creation, and infrastructure development. It transports 1.2 billion tonnes of freight annually, and the railway freight sector accounts for nearly 30% of India’s goods movement. The three proposed corridors in the 2024 Budget are set to enhance these capacities, ensuring faster, more efficient, and environmentally sustainable transport, which is crucial for economic growth and addressing regional disparities.

    1. Energy, Mineral, and Cement Corridors

    These corridors are designed to enhance the transportation of essential commodities like coal, minerals, and cement — key drivers of India’s energy and construction sectors. India’s industrial hubs and power plants rely heavily on the efficient movement of such resources, particularly from states rich in minerals and coal like Jharkhand, Odisha, and Chhattisgarh.

    • Economic Impact: These corridors will significantly reduce transportation time and costs for energy and mineral goods, particularly benefiting India’s coal, cement, and steel industries. According to reports by the Press Information Bureau (PIB), the corridors will streamline logistics and reduce bottlenecks in areas where large volumes of these commodities are moved, boosting industrial production and supporting India’s infrastructure development push.
    • Example from Assam and North-East: The North-East region, including Assam, is rich in coal and limestone deposits. Efficient transport of these resources to cement plants and energy consumers across India will benefit from these corridors. This will enhance regional economic development and ensure a smoother supply chain for critical resources, supporting industries in Assam and neighboring states.
    • Environmental Benefits: Transporting minerals and energy resources via rail is significantly less carbon-intensive than road transport. By shifting a larger portion of these goods onto rail corridors, the Indian Railways can reduce carbon emissions from freight, aligning with India’s target of achieving Net Zero by 2070.

    2. Port Connectivity Corridors

    Port connectivity corridors aim to improve the transportation of goods to and from India’s major ports, supporting both domestic industry and international trade. These corridors are expected to facilitate the smooth movement of export-import (EXIM) cargo, enhancing India’s integration into global supply chains.

    • Economic Impact: Improved connectivity to ports like Mumbai, Chennai, and Visakhapatnam will reduce the turnaround time for cargo, lowering logistics costs and enhancing trade efficiency. As per PIB, these corridors are expected to reduce transportation costs by 20-25%, making Indian goods more competitive in international markets. This is crucial for India’s growing manufacturing sectors, including textiles, chemicals, and pharmaceuticals.
    • Regional Impact: For Assam and the North-East, improved connectivity through the port corridors can enhance trade with Southeast Asian countries. With projects like the Kaladan Multimodal Transit Transport Project and the Act East Policy, better rail connectivity to ports can facilitate greater exports from the North-East region, boosting its economic prospects.
    • Sustainability: By facilitating smoother rail-based cargo movement to ports, the corridors will help shift freight transport from road to rail, reducing traffic congestion and vehicular emissions. This contributes to cleaner and more efficient trade logistics, further advancing India’s climate commitments.

    3. High Traffic Density Corridors

    These corridors will cater to regions where railway traffic is heavy, ensuring better connectivity and smoother operations in areas with significant passenger and freight movement. This will address congestion, improve operational efficiency, and enhance service reliability in high-demand areas like Delhi, Mumbai, and Kolkata.

    • Economic Impact: The high traffic density corridors will relieve congestion in critical sectors of the Indian Railways network, improving the movement of both passengers and freight. This is particularly significant for India’s industrial belts and urban centers, where delays can have major economic impacts. By ensuring smoother train operations in high-density routes, businesses will experience fewer delays in transporting goods, reducing the overall cost of logistics and improving economic output.
    • Boost to North-East Connectivity: The North-East, including Assam, often suffers from limited railway infrastructure and overcrowded lines, hindering economic development. Enhanced connectivity in high-density corridors can indirectly benefit the North-East by easing the movement of goods and passengers from other regions to the North-East, further integrating it into the national economy.
    • Environmental Impact: By streamlining high-traffic routes and increasing the efficiency of rail services, the corridors will reduce fuel consumption and improve the overall energy efficiency of Indian Railways. According to the PIB, Indian Railways’ target of achieving 100% electrification by 2030 will be supported by these new corridors, contributing to lower emissions and helping India achieve its climate goals.

    The three railway corridors announced in the Union Interim Budget 2024Energy, Mineral, and Cement Corridors, Port Connectivity Corridors, and High Traffic Density Corridors—will further solidify Indian Railways’ position as the lifeline of the Indian economy. By enhancing the efficiency of freight and passenger movement, reducing logistics costs, and improving environmental sustainability, these corridors will have far-reaching benefits for economic growth and climate action. Specifically, in regions like Assam and the North-East, these corridors promise better resource mobilization, enhanced trade potential, and deeper economic integration into the national framework. Indian Railways continue to be instrumental in driving inclusive development and sustainable growth across the country.

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