Indian Railways will charge 15% Busy Season Surcharge from Oct 1. Will you be affected?

Akshata Kamath
Akshata KamathSep 29, 2022 | 09:30

Indian Railways will charge 15% Busy Season Surcharge from Oct 1. Will you be affected?

If your 'aata' is brought to you by Indian Railways from Punjab, it might cost more. (Photo: Getty)

Indian Railways will charge a busy season surcharge of 15% on goods that are transported by freight trains. This charge will be levied on all goods except coal, coke fuel, containers and automobiles.

The circular: As per the Indian Railways' recently released circular dated September 27, 2022, called ''Dynamic Pricing Policy – Levy of Busy Season Charge, Development Surcharge and Congestion Charge'', Indian Railways will levy a 'busy season surcharge' of 15% on goods traffic from October 1, 2022.

What is this 'busy season surcharge'? This surcharge was announced in 2015 and is levied on transportation of all commodities except coal, coke (fuel, not your soft drink or the drug), and containers and automobiles moved in certain wagons. 

  • The surcharge is a source of revenue for the Indian Railways for carrying goods during particular periods of time from April to June and from October to March.
  • The Railways stopped levying this surcharge on October 1, 2019 and did not levy it for 3 years since then. 
  • The busy season surcharge was raised from 12% to 15% on freight base rates in March 2018. 
No Busy surcharge will be levied on transporting cars . (Photo: Twitter)

Why was the surcharge withdrawn? The Railways had withdrawn the charge on October 1, 2019, due to the slowdown in economic activities in the nation. The charge was waived for all goods except iron ore and petroleum, oil, and lubricants.

What's the impact: The withdrawal of the surcharge in 2019 led to a rise in freight loading as Indian Railways reported a record-high loading for two straight years till August 2022. 

  • In August 2022, the Indian Railways' revenue from freight increased to Rs 12,927 crore against Rs 10,867 crore a year ago. 
  • Though the surcharge will be levied from October 1 to June 30 with some exceptions, it is expected to hike the prices of goods like fertilisers, cement, food grains and other goods that are transported via Indian Railways.
Last updated: September 29, 2022 | 09:30
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