The railways parcel business will be entering the e-commerce space as the national transporter is planning to announce a special scheme that will attract the online retailers using road transport to shift heavy volumes.
The railways is earning around Rs 2,100 crore from the parcel business that can increase by about Rs 5,000 crore in the next three years, provided it taps the emerging e-commerce business. This move comes at the right time when the railways department is struggling to get away from the financial crisis that it is facing.
It has been reported that the Indian railways had an operational ratio of 93.5 percent in the fiscal year 2013-14. This left the transporter with very little funds of financial upgrade and reconstruction of rail infrastructure.
Regarding the move towards e-commerce portal, a senior official of the railway board announced that the firm is working on a special scheme that will partner with the emerging e-commerce firms to address their transportation requirements. It was added that the initial deliberations have been detained and that they will seek suggestions from the major e-commerce portals such as Flipkart and Amazon before framing the held plan.
Logistic companies’ shares including that of Gati and Blue Dart have been the best performers. And, railways board has a small stake in the same. The official claimed that railways will get a minimal share of 5 percent for the transfer of white goods, and the rest will be transferred through road. This can be expanded by 25 percent with the e-commerce firms onboard.
The railways board is scaling up the tracking system to let the customers track their parcels. This a key concern in the e-commerce industry where the consumers like to keep a check on the delivery time of their orders. However, the parcel tracking system is operational only on the route betweenDelhiandHowrahand it has been implemented for three years. The railways department is all set to look out for innovative ways to expand its revenue.
