Consumer durables, FMCG products, electronics, e-commerce goods, automobiles, paper products, and pharmaceuticals continue to be transported primarily by road, and Indian Railways (IR) must recalibrate its operations and pricing strategies to actively target these fast-growing freight categories, according to a report by FICCI and PwC.

The report, "Unlocking Growth: Railway Freight Portfolio Diversification in India", points out that coal, cement, and iron and steel account for nearly 70 per cent of the total freight volume moved by rail, indicating a heavy reliance on a limited set of commodities.

To expand its freight portfolio, IR must either grow its share within these traditional categories or diversify into new, especially lightweight, segments. The report emphasised that this shift is essential if IR is to meet its ambitious targets of handling 3,000 million tonnes (MT) of freight annually by 2027 and achieving a 45 per cent rail modal share by 2030.

Lightweight and non-traditional freight such as two- and four-wheeler automobiles, packaged consumer goods, paper, and pharmaceuticals are expected to grow at nearly twice the rate of bulk commodities and are seen as the future of logistics. Yet, these continue to rely on road transport due to perceived limitations in rail services.

To make rail a viable option for such goods, the report recommends improvements in operational efficiency, reliability, availability of suitable wagons, competitive pricing, customer-centric services, and a tech-enabled ecosystem.