Prabhu gives green signal to much awaited big-ticket FDI proposals
Moneylife Digital Team 09 March 2015
With the government allowing 100% FDI in the railway sector, setting up of the two big-ticket locomotive plants in Bihar through joint venture model is crucial for Railways to give a boost to its infrastructure
 
Railway Minister Suresh Prabhu has given the go-ahead to two much awaited big-ticket foreign direct investment (FDI) proposals for setting up diesel and electric locomotive plants in Bihar at a cost of Rs2,400 crore. This ends the suspense over the future of Madhepura electric locomotive plant and Marhora diesel locomotive plant in the state. 
 
The Railways have finalised the financial bidding for the high-value joint venture projects after considerable delays. After prolonged due diligence, there has been repeated revision of bidding documents. The request for proposals (RFP) containing financial bidding documents for both the plants are ready and the shortlisted bidders have been intimated the same, said a senior railway ministry official. 
 
Four global companies—Alstom, Siemens, GE and Bombardier—have been shortlisted for the proposed electric locomotive factory at Madhepura.  Two multinationals—GE and EMD—are vying to get the diesel locomotive plant at Marhora. The estimated cost of the factories is about Rs1,200 crore each. The financial bidding will be opened on 31st August and there will be two pre-bid meetings held in between, the official said. 
 
With the government allowing 100% FDI in the railway sector, setting up of the two locomotive plants in joint venture model is crucial for Railways to give a boost to its infrastructure. The two projects are among top eight infrastructure projects being monitored by the Prime Minister’s Office (PMO).
 
The Madhepura plant will manufacture 800 electric locomotives of 12,000 horse power (HP) over 11 years. While five electric locomotives will be imported, 795 will be manufactured at Madhepura, as per the bidding condition.
 
Marhora plant will produce 4500 HP and 6,000 HP diesel locomotives using state-of-the-art technology. In the course of about 10 years after commissioning, the proposed Marhora plant is expected to manufacture about 1,000 diesel-electric locomotives, that is 100 locomotives annually.
 
While 700 diesel locomotives will be equipped with 4,500 horse power (HP), 300 diesel locomotives will be manufactured with 6,000 HP. 
Comments
vishal
10 years ago
this is bound to stir the hornets net in the minds of Railways workers and unions. Whatever assurance given by the Government the Railways will not be privatized, there will be no takers for it in future. Whether or not this will affect the much needed funds for Railways is to be seen. With Private sector/s going to have a big hand in Railway infrastructure the cost of Railway travelling may go up.
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