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Costing and Pricing Issues in Transport Sector - Indian Railways ...

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Cost of service & Value of service<br />

• Cost of service :<br />

– Such charges must <strong>in</strong> no case be less than the cost to<br />

the railway management of render<strong>in</strong>g the required<br />

service.<br />

– This should be the lower limit of the freight rate.<br />

• Value of service :<br />

– They must <strong>in</strong> no case be more than the value of the<br />

service to the customers.<br />

– This should be the upper limit of the freight rate.<br />

Tuesday, September 06, 2011 INDRA GHOSH, Adviser/Rates Slide No. 29

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