Market Trends of Rail Freight Transport Industry
Increase in International transportation through Rail Freight
More than 1.08 million TEUs of freight have been transported between China and Europe in the first seven months of 2023, a year-on-year rise of 27%, according to state-owned China Railway Group Ltd (CRGL). China-Europe Railway has set up terminal deals with nine other European cities, including Moscow and Hamburg, and ships goods to 50 cities worldwide across more than 20 countries.
Indian railways' remarkable 7.5% increase in cargo transported in 2022, totaling 1,497 million tonnes, aligns with the National Rail Plan Vision-2030's goal to raise rail's freight share from 31% to 44% by 2051.
China's Guangdong-Hong Kong-Macao Greater Bay Area and Beijing-Tianjin-Hebei Region launched their first China-Kyrgyzstan-Uzbekistan (CKU) international multimodal freight train services, enhancing connectivity between Central Asia and two major economic hubs in China. The new route linking the Greater Bay Area adopts a containerized "railway-road" multimodal transport system. After arriving in Northwest China's Xinjiang Uygur Autonomous Region via railway, the cargo will then be transferred to road transport and exit through the Irkeshtam port, passing through Kyrgyzstan and ultimately arriving in Uzbekistan. The development of the CKU railway is very promising because it will be able to transport more efficiently and effectively than road transport.
Asia-Pacific Leads the Rail Freight Transport Market
An increase in demand for freight capacity is expected to drive the growth of the railway infrastructure market in Asia-Pacific. However, high capital requirements, lack of technology infrastructure and consistency in developing countries, and high overhaul and maintenance costs hinder the market's growth.
Among all the countries in Asia-Pacific, India is expected to have a positive outlook due to government support. The government of India has focused on investing in railway infrastructure by making investor-friendly policies. It has moved quickly to enable Foreign Direct Investment (FDI) in railways to improve infrastructure for freight and high-speed trains. Moreover, Indian Railways recorded a cumulative freight loading of 507.7 million tonnes (MT) in the first four months of the financial year 2023-2024, up 1.23% over the same period of the previous year.
Railways have earned INR 55,459 crore (USD 66.87 Million) from freight loading in April-July 2023 against INR 53,731 crore (USD 6474.5 million) over the last year, which is an improvement of 3.22% compared to the same period the previous year, the railways said in a statement.
In July 2023, Indian Railways achieved an originating freight loading of 123.98 MT, surpassing last year's loading of 122.15 MT for the same month by approximately 1.5%.
The China-Europe Railway Express operated 16,145 trains in the first 11 months of this year, up 7 percent year-on-year. According to China State Railway Group Co, a total of 1.75 million 20-foot equivalent containers of goods were carried, up 19 percent year-on-year.
