New Delhi, PTI. The World Bank has approved a $245 million loan to support India’s efforts to modernize rail freight and logistics infrastructure, the International Financial Institution said in a statement on Wednesday. The Rail Logistics project will give a further boost to rail traffic, making both goods and passenger transportation more efficient. This will reduce greenhouse gas emissions (GHG) by millions of tons every year. The project will also encourage more private sector investment in the railway sector.

Let us tell you that Indian Railways is the fourth largest rail network in the world, having transported 1.2 billion tonnes of freight in the financial year ending March 2020. Yet 71 percent of India’s goods are transported by road and only 17 percent by rail.

Indian Railways’ capacity constraints have limited volumes and reduced the speed and reliability of shipments, the statement said. As a result, its share has shrunk over the years. Its market share stood at 32 per cent in 2017-18, up from 52 per cent a decade ago.

Road freight is the largest contributor to GHG (greenhouse gas) emissions, accounting for about 95 percent of emissions in the freight sector. Trucks accounted for about 12.3 per cent of road accidents in 2018 and 15.8 per cent of the total road transport-related fatalities.

Hideki Mori, India’s operations manager and acting director at the World Bank, said the new project will also benefit millions of rail passengers in India while reducing greenhouse gases. Integrating railways with the wider logistics ecosystem is also important for reducing India’s high logistics cost, which is much higher than that of developed countries. This will make Indian firms more competitive.

Edited By: Sarveshwar Pathak