New Milestones: IR sets new records under Make in India initiative

IR sets new records under Make in India initiative

The central government’s flagship initiative, Make in India, has led to huge investments in the railway sector through several big-ticket projects. For instance, two locomotive factories in Bihar, currently under construction, marked the highest inflow of foreign direct investment (FDI) in the sector at Rs 400 billion. Meanwhile, the rail coach factory project in Kanchrapara, which is at the evaluation stage, is expected to bring in the second largest FDI of Rs 200 billion into the sector .

Recent developments

In a major development, the Integral Coach Factory (ICF) in Chennai achieved a new record by developing over 2,500 coaches in financial year 2017-18. The factory not only recorded the highest ever production but also surpassed its target of 2,464 coaches.

In October 2017, Indian Railways (IR) rolled out its first 100 per cent “made in India” Linke-Hofmann-Busch (LHB) coach, with each component manufactured at ICF, Chennai. The LHB technology was acquired through a technology transfer agreement with Alstom. As per the agreement between IR and Alstom Manufacturing India Limited, the joint venture (JV) company set up – Madhepura Electric Locomotive Company Limited – will supply electric locomotives from the factory at Madhepura. The locomotives will have state-of-the-art three phase propulsion system with regeneration capability, higher power output per axle and increased availability and reliability.

Further, as per another agreement signed between IR and GE Global Sourcing India Private Limited, the JV firm – GE Diesel Locomotive Private Limited – will supply diesel locomotives from the factory at Marhowra. The locomotives will have state-of-the-art AC-AC propulsion system with stringent emission standards, higher traction effort, and increased availability and reliability.

With regard to the new rail coach factory being set up in Kanchrapara, West Bengal, three bidders were shortlisted for the request for proposal stage – a consortium of CRRC Corporation Limited and Alstom Transport India Limited; a consortium of Siemens Aktiengesellschaft and Bombardier Transportation India Private Limited; and a consortium of Medha Servo Drives Private Limited and Stadler Bussnang AG. The project is currently on hold as a committee headed by the railway additional member (planning) has been formed to assess IR’s coach requirements till 2027-28 to gauge the overall viability of the project.

Besides, IR is currently implementing the Train-18 project, involving the development of the first-of-its kind semi-high speed, self propelled train sets, capable of running at speeds of 160 kmph, at ICF, Chennai. The project is currently under development and will be initiated by June 2018. The cost of these train sets will ultimately be half their import cost.

Meanwhile, IR is examining the technical aspects of the bid documents submitted by the only consortium interested in implementing the Train-20 project, involving the development of self-propelled, semi high-speed train sets for plying on the Delhi-Mumbai route. Though the pre-bid conference attracted seven global players, the Stradler-Medha consortium emerged as the only bidder after the final submission. The project is expected to cost Rs 27 billion and will entail the development of 14 train sets, with 20 aluminium-body coaches each, along with 11 spare coaches, to be manufactured at ICF, Chennai.

Other developments include the Chittaranjan Locomotive Works’ acquisition of technology from ABB, Switzerland, for manufacturing three-phase electric locomotives and the Diesel Locomotive Works’ acquisition of technology from EMD, USA, for manufacturing high horsepower, three-phase diesel locomotives.

With regard to signalling and telecommunications, the Cross Approval Policy has mandated all imported products, approved so far by the Research Designs and Standards Organisation (RDSO), to be indigenised. Therefore, modern signalling equipment such as electronic interlocking (EI) and digital axle counters (DACs) of foreign original equipment manufacturers (OEMs) have already been indigenised. Indian OEMs that are manufacturing entirely in India are Medha Servo Drives Private Limited for EI, and Central Electronics Limited and G.G. Tronics for DAC. Indian OEMs currently developing train collision avoidance systems with RDSO are Medha Servo Drives Private Limited, HBL Power Systems Limited, and Kernex Microsystems Private Limited.

The way forward

Going forward, areas such as signalling and telecommunications, high speed rail corridors and maintenance will offer vast opportunities for investment by foreign/private players. However, several issues will need to be addressed, especially those concerning the flux in policies, which has resulted in reluctance on the part of the private sector to enter the sector.