Indian Railways to review plan for coach factory in West Bengal

A committee is said to have been formed to make an assessment of coach requirements by the Indian Railways till 2027-28

Last Published: Tue, Jan 09 2018.   Jyotika Sood

This will be the second big project review by the Indian Railways after the new railway board chairman and railway minister took over. Photo: Hemant Mishra/Mint

New Delhi: Indian Railways’ proposed Rs20,000-crore Kanchrapara facility in West Bengal for manufacturing EMU (electric multiple unit)/MEMU (mainline electric multiple unit) coaches may hit the skids with the national carrier setting up a committee to ascertain its viability.

A senior railway ministry official said on condition of anonymity, “A committee headed by railway additional member (planning) has been formed to make an assessment of coach requirements by the national carrier till 2027-28. The committee has been also asked to give its views on Kancharapara—whether the project is required or not.”

“The review was ordered because of several reasons including some corruption complaints and the recent development where two of the RFQ (requests for qualification) shortlisted companies—Siemens and Alstom announced their merger,” the official further said. He added that the committee had also been asked to suggest ways to enhance coach production.

Notably, this will be the second big project review by the Indian Railways after the new railway board chairman and railway minister took over. In September last year, railways had stirred a big controversy with its idea of reviewing the Marhaura diesel locomotive project in Bihar being undertaken by US giant General Electric Co. (GE). The review had drawn a strong statement from GE stating that the decision to scrap the project would have a “serious impact on job creation and skills development and cause the government to incur substantial costs.”

In June 2016, railways had sought requests for qualification (RFQ) for manufacturing 5,000 modern EMU/MEMU coaches over the next 10 years at a proposed joint-venture facility at Kanchrapara. As per the railway plans earlier, the contracts for the project were expected to be awarded by May this year.

The Kanchrapara project is supposed to be a joint venture project with Indian Railways holding 26% stake in the coach facility unit. The national carrier had planned to buy 500 EMU/MEMU coaches annually which would be state-of-the-art, equipped with automatic doors and bio-toilets, non-AC stainless steel coaches with better interior design.

The RFQ had drawn good response with three consortiums being shortlisted. Two of these were led by Siemens and Alstom.

In an email response to Mint, the railways said, “Amongst other deliberations, the Committee is also expected to deliberate the modus of meeting the projected coach requirement in terms of ramping up the production at existing Production Units, market procurement and/or setting up new manufacturing facilities. Kanchrapara is also one of the probable locations for such capacity augmentation, should the need be perceived and accepted.” The report of the committee has been submitted and is under study.

The railways said that periodically there was a need for long term projection, for assessment of not only the Annual Production Programme but also deciding on capacity expansions/new designs/new factories for coach manufacture.

A Siemens spokesperson said, “We continue to look forward to submitting our offer for Kanchrapara. The intended global Siemens-Alstom merger is independent of any specific bid. Until the closure of this merger, Siemens and Alstom continue to be competitors.”