In collaboration with Jupiter Group, a leading producer of railroad wagons, passenger coaches, wagon components, and castings, Dun & Bradstreet, a leading global provider of business decisioning data and analytics, has released the second edition of its all-India survey, Railway Freight Activity Optimism Index (RFAOI).
The RFAOI survey was carried out to determine if rail freight activity in India is anticipated to increase, remain stable, or decrease by measuring the optimism levels of rail freight users (industry participants and logistics service providers). The index consists of 14 sub-parameters spread across four sub-indices: supply-side optimism, operational efficiency, investment sentiment, and demand sentiment.
Despite the uncertainties caused by the Russia-Ukraine war and the impending risks slowing down economic recovery, the Railway Freight Activity Optimism Index (RFAOI) for Q2 2022 is 63, three points higher than the previous quarter (global inflation and swift change in monetary policy)
The poll also shows that western businesses are the most enthusiastic about Q2 2022. (optimism index at 65). Compared to tiny and micro players, both large and medium-sized enterprises are more positive about the market for export freight.
According to Dr. Arun Singh, global chief economist at Dun & Bradstreet, the improvement in consumer mood and the beginning of economic activity have boosted the optimism level of businesses that move goods by railroad. According to our study, there is more optimism about shipping goods by train in Q2 2022 than in Q1 2022. We anticipate that as India successfully implements additional FTAs (foreign trade agreements) with other nations, commerce and logistic activities will pick up. However, the level of confidence for import freight demand, which is still the lowest in Q2 2022 among all the factors examined, may have been impacted by rising logistic costs and general inflationary pressure, given rising fuel prices and the weakening of the rupee. Future freight costs are anticipated to stay high or perhaps climb, as 40% of businesses anticipate higher costs for shipping by railroads in Q2 2022.
The director of Jupiter Wagons, Vivek Lohia, stated: “Railway freight activity is projected to pick up steam in Q2 2022. According to the survey, firms are willing to expand the proportion of goods they ship via rail, but they also expect rail transit to become more expensive. For the majority of the survey factors taken into account for the rail freight activity optimism index, the western area is the most upbeat. In terms of availability of wagons and travel time, there are now two areas of concern that have decreased from the previous quarter. However, even if optimism for wagon availability has decreased, it has climbed for wagon utilization, which is higher than containers compared to the previous quarter.
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