Towards decarbonising India’s transport system, freight activity



Indian Railways and Rapid Rail Transit (popularly known as Metro) are  one of the major modes of transportation  for passengers and freight in India today. India’s National Rail Plan (NRP) aims to increase the share of rail in freight transport to 45% by 2030, up from the current 27%. This increase will lead to higher emission of GHGs,  if we do not take appropriate action at this moment. 

The transport sector of India is the third biggest emitter of greenhouse gas (GHG), whereas the major contribution comes from the road transport sector. Out of the total carbon dioxide emissions in India, 13% comes from the transport sector. These emissions have more than tripled since 1990. The increasing motorization and demand for mobility in India have contributed to increased levels of air pollution congestion, as well as the increase in the emission of greenhouse gas, specifically in the urban areas.

The International Energy Agency (IEA) and International Union of Railways (Union Internationale des Chemins de fer-UIC) research indicates that Indian Railways produces approximately 11.5 gCO2e per passenger-km travelled and about 9.5 gCO2e per ton-km of freight transported. 

According to the IEA, India’s transport sector is responsible for 13.5% of the country’s energy-related CO2 emissions, with road transport accounting for 90%, rail and domestic aviation accounting for 4%, and waterways accounting for 1%. In 2020, the total CO2 emissions from Indian transportation were 368.72 Mt, with road transport accounting for 87%, railways, airways, and waterways accounting for 7%, 5%, and 1%, respectively.

Decarbonization of the transport sector is essential to reduce the Greenhouse Gases (GHGs) emission and to meet the ambitious target of achieving net-zero emissions by 2070 set by Government of India. 

What is Decarbonization?

Decarbonisation involves increasing the prominence of low-carbon power generation, and a corresponding reduction in using fossil fuels. This involves,in particular, a use of renewable energy sources like wind power, solar power, biomass, etc.

Main Objective

The main objective of decarbonisation is to make the transportation ecosystem more environmental- friendly and sustainable by reducing its carbon footprint. It refers to the process of reducing or eliminating the carbon emissions associated with the transportation sector.

Decarbonisation of the transport sector would create a cleaner, healthier and more affordable future for everyone. 

Decarbonizing India’s transport system

Decarbonizing India’s transport system, particularly in the realm of freight activity, is a significant challenge but also a crucial one for mitigating climate change and improving the air quality. We have summarised some strategies and initiatives that can contribute to decarbonizing freight transport in India.

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Rail is also the most energy-efficient land-based transport mode for freight. Rail also has a high reliance on electricity, which can be produced from renewables to eliminate GHG emissions. Of conventional passenger rail activity, 54% is powered by electricity (on a passenger kilometre basis), compared to 65% of total freight rail activity.

Understanding Challenges

To tap the potential of freight decarbonisation in India, the most important thing that needs to be addressed is making long-distance freight more efficient through a modal shift to the rail transport system. We need to understand the challenges (technological, behavioural, economic and social) and opportunities specific to the Indian freight transport sector that hinder the implementation of modal shifts from road to rail. We also need to explore alternative solutions for challenges in decarbonization . 

The transport sector faces several barriers to decarbonisation, especially insufficient regulatory incentives, lacking infrastructure, and limited demand from shippers. Achieving complete electrification and deploying renewable energy requires substantial investments. Issues like Climate Change, Energy Security, Air Pollution & Cost efficiency come midway when it comes to policy or strategy formulation. 

Innovative financing mechanisms and public-private partnerships are crucial for resource mobilisation. Technology Development & advancements in battery technology and hydrogen fuel cell technology are essential for powering trains on non-electrified routes.

Decarbonization of the transport sector is essential to reduce the emission of  GHGs, achieving net-zero emissions by 2070. Also, in order to achieve the ambitious goal of 45% share of railway in freight transport, It becomes more important than ever to reduce the emission of greenhouse gases.

Incentivize Rail Transport for Freight Shipping

The Ministry of Railways is also implementing policies and strategies to incentivize rail transport for freight shipping (Parliamentary Standing Committee on Railways 2017-18), and has recently introduced new initiatives to boost railway modal share for freight transport.

  • The National Rail Plan (NRP) of 2020 envisions achieving a rail share of 45% in freight transport by 2030–31.
  • Automatic Freight Rebate Scheme Offers discounted freight on routes where the railway operates empty wagons annually.
  • Long Term Tariff Contract (LTTC) Provides freight stability
  • Non-levy of Terminal Charges at the unloading point of notified alternate goods
  • Zonal Railways have been empowered to get into a long-term contract with customers for short-lead traffic
  • Revised Round Trip Tarif-freight discount is granted to traffic if the customer offers to book traffic onwards as well as return direction
  • Incentive to Fly Ash: 40% discount in freight is granted to fly ash
  • A short lead concession has been re-introduced from 01.07.2020, under which discount in freight at the rate of 50%, 25% and 10% is granted to the traffic booked up to 0-50KM, 51-75KM and 76-90 KM, respectively except Coal & Coke and Iron ore traffic.
  • Stabling charge for privately owned wagons
  • 25% concession on Haulage Charge

There are so many other strategies adopted by IR to incentivise the freight. The main objective behind these all is to promote movement of goods traffic through railways. These incentives are expected to boost the economy of the country through giving railways a boost.

Strategies for Decarbonising India’s transport system

We have summarised some ways through which the decarbonisation of the transport system can be ensured in India.

  1. Promoting Electric Vehicles (EVs)

Encouraging the adoption of electric vehicles for freight transport can significantly reduce carbon emissions. This includes not only electric trucks but also electric two-wheelers and three-wheelers for last-mile delivery. The Indian government has already initiated schemes like FAME (Faster Adoption and Manufacture of Electric Vehicles) to incentivize the adoption of EVs.

  1. Investing in Charging Infrastructure

Building a robust charging infrastructure network across the country is essential for supporting the widespread adoption of electric vehicles. This involves establishing charging stations along key freight corridors and in urban centres to facilitate long-haul and intra-city freight movements.

  1. Promoting Clean Fuels

Apart from electric vehicles, promoting the use of cleaner fuels such as compressed natural gas (CNG) and liquefied natural gas (LNG) for freight transport can also help reduce emissions, especially in heavy-duty vehicles.

  1. Improving Logistics Efficiency

Optimizing freight logistics can lead to reduced fuel consumption and lower emissions. This includes measures such as route optimization, load consolidation, and implementing technology-driven solutions like GPS tracking and real-time monitoring to improve fleet efficiency.

  1. Encouraging Multimodal Transport

Integrating various modes of transport, including road, rail, waterways, and air, can help optimize freight movement and reduce the carbon footprint. Developing multimodal logistics parks and incentivizing intermodal transportation can facilitate seamless cargo movement while minimizing emissions.

  1. Regulatory Measures and Incentives

Implementing stringent emission norms for vehicles and providing incentives such as tax breaks and subsidies for zero-emission vehicles can accelerate the transition towards cleaner freight transport.

  1. Awareness and Capacity Building

Educating stakeholders about the environmental benefits of decarbonizing freight transport and providing training programs to drivers and fleet operators on eco-friendly driving practices can promote sustainable behaviour.

  1. Research and Development

Investing in research and development initiatives to improve the efficiency and affordability of clean transport technologies, such as battery technology and hydrogen fuel cells, can further drive the transition towards decarbonization.

  1. Public-Private Partnerships (PPPs)

Collaborating with private sector stakeholders to develop and implement sustainable freight transport solutions can leverage resources and expertise from both sectors towards achieving common goals.

  1. Policy Support and Long-term Planning

Formulating comprehensive policies and long-term strategies that prioritize decarbonization goals and provide a clear roadmap for the transition can create a conducive environment for investments and innovation in clean freight transport.

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By implementing these strategies in a concerted manner, India can make significant strides towards decarbonizing its freight transport system, contributing to national climate goals and fostering sustainable economic development.

Opportunities for MSMEs & Startups in Indian Railways’ Decarbonisation

The Indian Railways’ ambitious decarbonization journey presents a wealth of opportunities for Micro, Small and Medium Enterprises (MSMEs) and startups. Here’s a closer look at some key areas where these agile businesses can play a vital role:

Renewable Energy Integration:

  • Solar Panel Manufacturing and Installation: As the Indian Railways scale up their solar power capacity, MSMEs can contribute by manufacturing and installing high-efficiency solar panels on railway land and rooftops.
  • Wind Power Solutions: MSMEs can explore developing and supplying smaller-scale wind turbine solutions suitable for on-site wind power generation at railway stations or workshops.

Energy Efficiency Technologies:

  • LED Lighting Solutions: Developing and supplying cost-effective LED lighting solutions for stations, platforms, and train coaches can significantly reduce energy consumption.
  • Sensor-based Automation: MSMEs can develop and implement sensor-based systems for automatic lighting control, air conditioning activation, and other applications in stations and buildings, leading to energy savings.

Green Materials and Equipment:

  • Sustainable Construction Materials: Developing and supplying eco-friendly building materials for railway infrastructure projects can contribute to the overall sustainability goals.
  • Energy-efficient Railway Components: MSMEs can focus on research and development of energy-efficient components for locomotives, coaches, and track infrastructure.

Green Technologies:

  • Battery Storage Solutions: As the Indian Railways explore battery-powered trains, MSMEs can contribute by developing innovative and cost-effective battery storage solutions for various applications.
  • Hydrogen Fuel Cell Technology: MSMEs can participate in research and development of hydrogen fuel cell technology for potential applications in future railway projects.

Data Analytics and Monitoring:

  • Energy Management Platforms: Developing user-friendly platforms that track energy consumption across different railway operations can help identify areas for improvement and optimize energy usage.
  • Predictive Maintenance Solutions: MSMEs can create data-driven solutions for predictive maintenance of locomotives and other railway assets, leading to improved efficiency and reduced energy consumption.

Capitalizing on the Opportunities:

To effectively harness these opportunities, MSMEs and startups need to:

  • Focus on Innovation: Developing novel and cost-competitive solutions tailored to the specific needs of the Indian Railways is crucial.
  • Collaboration: Partnering with larger companies, research institutions, and the Indian Railways themselves can facilitate knowledge exchange and accelerate innovation.
  • Government Support: Leveraging government initiatives and schemes promoting clean technologies and MSME development can provide financial and logistical support.


The Indian Railways’ decarbonisation journey is long and arduous, but the commitment is unwavering. By implementing the strategies outlined and addressing the challenges head-on, the Indian Railways can achieve a significant reduction in their carbon footprint. This transformation will not only benefit the environment but also enhance the sustainability and competitiveness of the Indian Railways in the long run.Additionally, the success of the Indian Railways’ decarbonization efforts can serve as a model for other railway networks around the world, demonstrating that large-scale decarbonization in the transportation sector is achievable.


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