Railway engine plant- press report

Opening of price bids for railway engine plant derails again

Sudheer Pal Singh / New Delhi July 16, 2011, 0:49 IST

Indian Railways has postponed the opening of price bids for an electric engine manufacturing project. The railways plans to set up the project in Bihar jointly with the private sector, pending final recommendations by a high-level committee on Public Private Partnership (PPP) and vacancies created in some top positions. This could mean further delays in the railways’ plan to augment capacity and improve operating efficiency to ramp up revenue generation.
“Bids for the Madhepura electric locomotive project were to be opened today. They have been postponed for some time. We will like to wait for the new member (electrical) to come. Also, the final recommendations of the committee on PPP projects are yet to come,” said a senior official from the Railway Board.
 Four companies, including General Electric (GE), Alstom SA, Bombardier Inc and Siemens AG, are in the race for the contract. Another rail ministry official said the ministry would take a call next week on whether the financial bids for the Marhora diesel engine project would be opened as scheduled on July 29.
Two top positions of the six-member Railway Board became vacant after Member (Electrical) Sudesh Kumar and Member (Staff) V N Tripathi retired on June 30.
An empowered committee comprising top officials from the ministries of railways, finance and law, and the Planning Commission met for the second time on June 21 to give recommendations on four top-notch PPP projects including Madhepura, the proposed diesel engine manufacturing plant in Marhoura and the engine component and coach factories in West Bengal.
Asked whether there were differences between the rail ministry and the finance ministry over the price the companies could charge for their engines, the first official said,
“There is no difference of opinion at all. The finance ministry member had raised certain issues we had not looked at earlier.”
The two engine-making projects were announced by the then railway minister Lalu Prasad Yadav in 2007. They were conceived as PPP projects with the railways holding 26 per cent stake in each. The total estimated value of the contracts for 800 electric engines and 1,000 diesel locomotives is around $13 billion.
This was the ninth time the date for opening price bids for the electric engine project was deferred. The date for the diesel engine project, too, has been postponed six times and is now set for July 29.