NAIROBI, JAN 2 — Kenya has commenced commercial operations of the Standard Gauge Railway (SGR) freight train services, giving importers and exporters of cargo through the port of Mombasa an alternative mode of transport from road.
The first commercial cargo train arrived in Nairobi on Monday (January 1), at the refurbished Embakasi ultra-modern Inland Container Depot (ICD), which was launched by President Uhuru Kenyatta a fortnight ago.
Kenya Railways managing director Atanas Maina said in a recent statement that the freight service will be available round the clock and customers will pay between $ 500(about Ksh51, 685) and $ 700(Ksh72, 359), to transport a 20 foot and 40 foot container respectively.
The commercial train service comes after more than six months of testing, with Kenya Railways affirming it’s satisfaction with its operations.
The first commercial cargo train carried 104 containers, which is almost equivalent to the trucks operating daily on the Mombasa-Nairobi highway.
The SGR commercial services will at the moment be available between the port of Mombasa and the Kenya Ports Authority managed ICD.
The capacity of the new ICD, officially commissioned by President Kenyatta on December 16, has been expanded to handle up to 450,000 —20-foot-equivalent unit (TEUs), from 180,000 TEUs.
According to the Kenya Ports Authority head of Inland Container Deports Symon Wahome, the new commercial cargo train will revolutionize the transport of cargo in Kenya.
“While the meter train used to carry twenty to thirty containers, the standard gauge train will carry 216 containers .This is a big relief for our importers and exporters. The ICD will be able to achieve its original objectives of easy logistics from Mombasa to upcountry, ensuring our customers are served as efficiently as possible,” Wahome said.
He said currently, there will be four trains operating daily (two from either ends) but in the fullness of time, eight cargo trains are expected to operate between Mombasa and Nairobi daily, with the ICD operating 24 hours.
“We have already discussed with revenue authorities and agreed that within six hours, you should be able to clear your container from the ICD,” Wahome noted, during the marshalling of the first cargo train at the Embakasi ICD.
The refurbished ICD incorporates a one-stop centre which houses representatives of Rwanda, Uganda, Burundi and Kenya Revenue Authorities , who will clear goods destined for the various destinations and that will leave the Port of Mombasa before being cleared.
Domestic traffic will be charged in local currency whereas transit or ICD traffic will be charged in US Dollars.
The minimum chargeable distance for all types of goods for up and down direction is 300 kilometres.
The minimum cost of transporting a fully loaded 20-foot container is set at Ksh19, 800 at a minimum distance of 200 Kilometres.
The maximum cost of transporting a fully loaded 20ft container has been set at Ksh49,500 for the full distance between the port of Mombasa and the Nairobi inland container depot.
Agricultural inputs will however enjoy a lower rate at a minimum cost of Ksh16, 500 for a minimum distance of 200 Kilometres and a maximum cost of Ksh41, 250, for the full distance between the port of Mombasa and the ICD, according to Kenya Railways.
Motor vehicle importers will incur a cost of Ksh3, 300 to transport their vehicles from the port of Mombasa to Nairobi while transit vehicles will be ferried at a cost of Ksh2, 640.
The maximum weight allowed on a 20 ft container is 30 tonnes while the maximum allowed weight on a 40ft container is 35 tonnes.
The costs are however exclusive of handling costs and VAT. All goods destine for the local market will be subjected to 16 per cent VAT while transit goods and goods being exported from Kenya will be Zero rated.
Handlers of large cargo volumes between 4,000 and 40,000 tonnes will enjoy discounts between five per cent and 20 per cent, according to Kenya Railways.
The minimum chargeable weight for non-containerized cargo is 70 tonnes while that of light down traffic such as food stuffs, steel, animal feeds and paper is set at 43 tonnes per bogie wagon.
During the commissioning of the ICD, President Kenyatta said that the government is committed to lowering the cost of doing business through investment in enabling infrastructure.
“Over the last four years, the government has invested in the expansion of the country’s transport and infrastructure network with a view of reducing the cost of doing business while creating new business and employment opportunities,” Kenyatta said.
In his new year’s message, President Kenyatta said the new commercial cargo train would cut costs and delays in trade for Kenya and its neighbours.
The president said the delivery of a world-class railway on time and within budget, would attract world-class manufacturing and value-addition investments, which are critical to creating jobs and business opportunities.
The ICD will be served by two access roads, one linking to the Southern By-pass (Road A, 4.122kms) and the other linking to the Eastern By-Pass (Road B, 3.044kms).
A key feature contributing to the ICD’s efficacy is the One-Stop Centre. Here, all government agencies involved in the cargo clearing process (Kenya Railways, Kenya Ports Authority, Kenya Revenue Authority, and Kenya Bureau of Standards) are housed in one space thus facilitating efficient clearing and forwarding of cargo at the ICD.
In terms of infrastructure, the ICD is well equipped, ably served by a spacious container yard, four- SGR loop lines within the ICD, four rail-mounted cranes and eight rubber-tyred gantry cranes to assist in loading, offloading and movement of containers around the yard.
Kenya Railways will run freight trains with 54 double-stack flat wagons each, carrying 216 twenty-foot containers each with a total load of 4,000 tonnes on each train.
The state corporation has been given a target of delivering six million tonnes to the Nairobi ICD in the next six months.
The SGR services are currently popular with the Madaraka Express (passenger rail services) launched in May last year, which has already had a significant impact on the tourism sector, boosting both foreign and domestic tourism.