Railway Minister Suresh Prabhu has finally given green signal for two long stalled, big-ticket, Foreign Direct Investment (FDI). The proposals for setting up of the state-of-the art diesel and electric locomotive manufacturing plant in Bihar at a cost of Rs 2,400 crore has been approved. This is in line with Prime Minister Narendra Modi’s “Make in India” campaign. The two projects are among the projects being monitored by the PMO.

This has put an end to the suspense over Madhepura electric locomotive plant and Marhora diesel locomotive plant. Railways have finalized the financial bidding for the high-value joint venture projects, after much deliberation and prolonged due diligence, amid repeated revision of bidding document.

The minister has also prepared and drafted Request for Proposals (RFP), containing financial bidding documents, to the shortlisted candidates including four global firms viz. Alstom, Siemens, GE and Bombardier. These four firms have been shortlisted for the proposed electric locomotive factory at Madhepura and two multinationals GE and EMD are in race to bag the diesel locomotive plant at Marhora. The estimated cost for setting up the state-of-art facilities in these factories is about Rs 1,200 crore each and the financial bidding is expected to open on August 31st 2015.

Madhepura plant will manufacture 800 electric locomotives of 12,000 horse power (HP) over the 11 year period and Marhora plant will produce 4500 HP and 6,000 HP diesel locomotives using state-of-the-art technology. About 10 years after commissioning, the proposed Marhora plant is expected to manufacture about 1,000 diesel-electric locomotives, which is about 100 locomotives annually. Railways will have 26 per cent equity in each of the plants at Madhepura and Marhora and the global players will be having 74% equity.

By Premji