16 firms bid for 90,000 wagons procurement contract of Indian Railways

Anushka Khare Posted on: 2022-04-24 08:30:00 Viewer: 6,969 Comments: 0 Country: India City: New Delhi

16 firms bid for 90,000 wagons procurement contract of Indian Railways

New Delhi, India (Urban Transport News): The national transporter Indian Railways has received 16 bids from wagons manufacturers against the tender floated for procurement of 90,000 wagons over the next three years.

According to sources, the firms include Titagarh Wagons, Texmaco Rail and Engineering, Hindusthan Engineering and Industries Limited, Oriental Rail Infrastructure Limited, Jupiter Wagons, Jindal Rail Infrastructure Limited, Cimmco (acquired by Titagarh Wagons) and Om Besco Railway Wagons Manufacturer (erstwhile Besco Limited). Other wagon manufacturers in the space include public sector enterprises such as SAIL-RITES JV, Bengal Wagon Industry, and Braithwaite and Company.

"All the companies that qualify technically will have to match the rate offered by the lowest bidder if they wish to be able to supply the wagons. It is learned that technical qualification bids for the large tender (estimated to be around Rs 30,000-35,000 crore -- subject to change depending on input prices) are being finalised," said the government official. 

“Work on this is being done on a priority basis. Technical comments from the Rail Design Standards Organisation (RDSO) were received just in a day, something that did not happen earlier. There are about ten significant players who are likely to get major orders, and there are some players who may get developmental orders (to widen the base),” said another official.

This mega procurement plan is a part of Indian Railways' strategy to move closer to its goal of ferrying a much higher share of cargo in the country, to about 40-45 percent by 2030, from 26-27 percent, according to the National Rail Plan it has chalked out. To achieve the target it has set for itself, the Indian Railways will need over 3 lakh wagons till 2030.

The procurement plan for 90,000 wagons historically the largest of its kind, is almost five times the wagons procured by railways in a year. Indian Railways may procure an additional one lakh wagons over the next three years, suggested recent media reports.

“We would like to procure as much as the market can offer over the next few years. Whether we would be able to do that over the next three or four or five years, will need to be assessed – say, through longer-term contracts,” said the government official.

On the face of it, for wagon manufacturers, this order provides an assured flow of business for the next three years. However, soaring steel prices, shortage of rail wheels in the backdrop of the Russia-Ukraine war, and lockdowns in China have led to a different set of challenges that have constrained capacities in the current environment.

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