Railway Freight Activity Optimism Index (RFAOI)

Overall freight activity is expected to increase many folds over the coming years. To cater to the growing demand for freight, the shift in the modal share of transport from roadways to railways has become more critical than ever. Indian Railways aims to increase its modal share in freight to 45% from current level of 27%. To increase the share, various initiatives are being taken to modernize the rail infrastructure enabling low transit time, increased productivity, and lower overall freight cost.

Given the expected increase in freight demand, thrust on railway infrastructure and expected gains in operational efficiency in transporting freight through railways, understanding changing market dynamics of rail freight activity is important. In this context Dun & Bradstreet and Jupiter Wagons are introducing first of its kind in India, a quarterly Railway Freight Activity Optimism Index (RFAOI), based on survey responses to capture the optimism level of businesses across India towards using railways to transport their freight.

About the RFAOI

Railway Freight Activity Optimism Index (RFAOI) is a unique index aiming to capture the optimism level of the users of the railways (industry players and logistics service providers) on expected rail freight activity i.e. whether the rail freight activity is expected to improve, remain stagnant or decline for the upcoming quarter. The index is composed of 14 parameters across four sub-indices.

The Index will track the optimism level towards freight transport activity of different stakeholders, large, medium and small businesses across regions on a quarterly basis. To construct the index, a survey on 300 panelists including industries and logistics service providers utilizing railway freight services encompassing all railway zones will be done on a quarterly basis. The index value can range between 0 to 100, with 50 being the neutral level of optimism. Index value above 50, would indicate an increased level of optimism from the previous quarter and vice-versa. Higher the value means higher the degree of optimism.

Objective of the index

RFAOI is a forwarding looking index of pan India rail freight activity

Stakeholders will be able to identify the expected shift in demand and supply and meet expectations for operational efficiency across segments/regions to make informed decisions

An important input in supply chain planning of service providers, supply side industries and government

A ready reckoner for policy makers to understand the requirement of the user industries and plan towards meeting supply/investment demand

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