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Railway privatisation: These companies could be running trains in India

Adani Ports, Essel Group, Tata Realty and Infrastructure, Bombardier and Alstom could be in the fray.
Jul 2, 2020 / 04:57 PM IST

Indian Railways on July 1 kick-started its privatisation plan with the government inviting requests for qualifications (RFQ) from private players.

The bid is for running 151 trains in 109 pairs of routes. Each train will have 16 coaches. It is estimated that this would attract an investment of close to Rs 30,000 crore.

The plan to allow private entities was started back in 2019 with a bidding process in December 2019. According to an Economic Times report, the first bidding process saw about 20 companies in infrastructure and transportation business express interest.

These include Adani Ports, Tata Realty and infrastructure, Essel Group, Bombardier India and Macquarie group. However, it was before the coronavirus pandemic.

In the post-pandemic world, will the same players bid? At this point it is not clear yet. However, given that these players have implemented multiple infrastructure projects of the government and with the financial muscle they possess, they could be potential contenders.

Adani Ports

Adani group owns one of the largest private railway lines in India that spans 300 km connecting ports and other business hubs for cargo movement. This is in addition to the large scale infrastructure projects the company handles.

The company also has worked with the Ministry of Railways and Metro corporations in different states. In 2019, the company set up its own subsidiary to focus on metro rail projects.

Essel Group

If there is one other group that has the capability and the bandwidth to bid, it would be Subhash Chandra-led Essel Group. The group has been involved in multiple government infrastructure projects for decades.

The group’s foray into railways came in 2018 when it won its first Railway projects.

In 2018, the group’s infrastructure arm Essel Infraprojects Ltd won the first railway project for Rs 17.06 billion on the Eastern Freight Corridor connecting Howrah and Chennai mainline. Its competitors at that time included IRCON International, an Indian Railways infrastructure arm.

Tata Realty and Infrastructure Ltd

It is a 100 percent subsidiary of the Tatas and is the infrastructure arm of the group. The firm was qualified for the Hinjewadi-Shivajinagar Metro in Pune and participated in the bid to lay the underground stretch for Delhi-Meerut Regional Rapid Transit System.

Foreign players

Bombardier

The German firm is the first foreign multinational company to set up a wholly owned railway vehicle manufacturing facility in India, more than 50 years ago. They are one of the largest locomotive suppliers to Delhi Metro and have delivered close to 776 metro cars till date. In May, the company won the contract to supply 210 commuter and metro cars for the Delhi-Meerut Regional Rapid Transit System.

Given their long-standing relationship with the railway ecosystem, they are strong contenders as well.

Alstom

The French infrastructure major has a strong presence in India and employs about 5,600 people. They are currently working on the metro projects across the country including Chennai, Mumbai, Kochi and Lucknow.

The locomotives for the domestic and international metros such as Sydney are manufactured in Alstom's  facility in Sri City in Andhra Pradesh. Other manufacturing facilities in India include Coimbatore in Tamil Nadu, Madhepura in Bihar and also Kolkata. The company has also setup its largest global engineering centre after France in Bengaluru.

In line with Government of India’s ‘Make in India’ initiative, the company said that it has been investing heavily to produce rolling stock (locomotives), components, design, research and development to serve the domestic as well as international markets. "With this, the company is well-positioned to participate in railway projects," the company added.
Moneycontrol News
first published: Jul 2, 2020 04:57 pm
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