Indian Railways Cancels Rs 30,000 Crore Tender for the Production and Maintenance of 100 Vande Bharat Trains | Opens the Door for more Competitive Bidding in the Future

Indian Railways Cancels Rs 30,000 Crore Tender for the Production and Maintenance of 100 Vande Bharat Trains | Opens the Door for more Competitive Bidding in the Future

Introduction:

Indian Railways has decided to cancel its Rs 30,000 crore tender for the production and maintenance of 100 Vande Bharat trains. The decision was influenced by several factors, including the high cost quoted by the lowest bidder, Alstom India, and the limited number of participants in the bidding process. 

This article delves into the reasons behind the cancellation, the reactions from key stakeholders, and the potential implications for the future of Indian rail transport.

Reason for the Cancellation:

The primary reason for the tender cancellation was the high price quoted by Alstom India, the lowest bidder. Alstom India proposed a price of Rs 150.9 crore per train, whereas Indian Railways aimed to finalize the deal at Rs 140 crore per train. 

The significant price gap led the railways to reconsider the tender. Furthermore, only two companies participated in the bidding process, which included Alstom India and a consortium of Stadler Rail from Switzerland and Hyderabad-based Medha Servo Drives. 

Indian Railways hoped that a fresh tender might attract more competitors, ensuring a more competitive and cost-effective bidding process.

Details of the Tender:

The tender, initially opened on May 30, 2023, was intended for the manufacture of 100 aluminium-body Vande Bharat trains over a span of seven years. 

The choice of aluminium was strategic, as aluminium train sets are lighter and more energy-efficient compared to their stainless steel counterparts. 

Despite the cancellation, the importance of aluminium in the future of Indian rail transport remains a key consideration due to its benefits in reducing energy consumption and improving overall train efficiency.

Alstom India’s Reaction:

Following the cancellation, Olivier Loison, Managing Director of Alstom India, confirmed the development. Loison expressed the company's readiness to support Indian Railways in the future, highlighting Alstom's extensive local knowledge and investments in both industrial and human capital. 

A spokesperson for Alstom further elaborated on the situation, noting that their offer was competitive, especially when compared to similar trains produced globally. 

The spokesperson emphasized that manufacturing aluminium trains with a 220 km/h design speed requires significant initial investments in product design and the development of a local supply chain, aligning with the 'Atma Nirbhar Bharat' (self-reliant India) vision.

Previous Contracts and Future Outlook:

Before this tender, Indian Railways had awarded a contract to manufacture 200 stainless steel Vande Bharat sleeper trains at Rs 120 crore per train. 

The difference in material choice between the tenders reflects the evolving needs and technological advancements in India's rail industry. Alstom remains committed to contributing to India's rail sector, expressing confidence in their ability to lead India into a future of efficient and sustainable rail mobility.

Conclusion:

The cancellation of the Rs 30,000 crore tender for 100 Vande Bharat trains marks a significant moment for Indian Railways. 

While the decision was driven by cost concerns and the limited number of bidders, it opens the door for more competitive bidding in the future. 

Alstom India's strong positioning and commitment to innovation suggest that they will continue to play a vital role in India's rail modernization efforts. 

As Indian Railways prepares to reissue the tender, the industry will be watching closely to see how these developments shape the future of rail transport in India.

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