MC Exclusive | RVNL-Russia’s CJSC Transmashholding consortium emerges lowest bidder for 200 Vande Bharat trains

A Vande Bharat Express train (file image)

The consortium of Russia’s CJSC Transmashholding (TMH) and Rail Vikas Nigam Limited (RVNL), a railway public sector utility, has emerged as the lowest bidder for the Rs 58,000-crore tender for manufacturing and maintenance of 200 Vande Bharat trains, documents reviewed by Moneycontrol on March 1 show.

The consortium had a bid of Rs 120 crore per train and is looking to manufacture all 200 steel Vande Bharat rakes, the documents show.

The consortium of state-run Bharat Heavy Electricals Ltd (BHEL) and Titagarh Wagons emerged as the second lowest bidder with a bid of Rs 139.8 crore per train.

The consortium will be given the opportunity to match the lowest bid in order to take home a part of the tender, as per the bid documents.

Other players in the fray included French railway major Alstom, the Medha-Stadler consortium between Swiss railway rolling stock manufacturer Stadler Rail and Hyderabad-based Media Servo Drives and Siemens along with BEML.

Will they deliver on time?

RVNL-TMH and the BHEL-Titagarh consortiums have a low-manufacturing presence in India when compared to the other players.

"The emergence of Russia’s Transmashholding (TMH-RVNL) as the lowest financial bidder for 200 Vande Bharat trains and the consortium of BHEL and Titagarh Wagons as the second lowest bidder presents a challenge for the timely production of the Vande Bharat trains," Sudhanshu Mani, former general manager of Integral Coach Factory, Chennai, and the chief architect of India’s first Vande Bharat project, said.

The quoted rates appeared to be very aggressive and could be so due to TMH’s desperate bid to enter the Indian market through the order for 120 trains at Latur.

"Russia’s Transmashholding has no footprint in India and it will not be an easy task for them to deliver these trains in time. It would also be interesting to see if BHEL Titagarh accepts this L1 price for 80 trains in ICF," Mani added.

Under the bid conditions, manufacture, supply and maintenance of 120 trains would be awarded to the lowest bidder (L1). These would be manufactured at the Latur facility of the Indian Railways.

The remaining 80 trains would be manufactured at Chennai and awarded to the second lowest (L2) bidder, provided the price offered by the L1 was matched.

Mani said that aggressive bidding was likely to be a dampener for competent manufacturers like Alstom, Siemens and Stadler and present some uncertainty for this ambitious project.

As part of the tender, the trains would be maintained at five-six government depots in cities like Delhi, Mumbai, Bengaluru, and Jodhpur, a government official said.

The lowest bidder (L1) was expected to supply the first prototype train within two years, the official said.

If the L2 bidder refused to take up the contract, the same offer would be extended to the third lowest bidder. The contract for the remaining trains would be awarded to the L1 bidder if the other bidders don’t match the lowest price offered.

Tender for 200 Vande Bharat Trains

The bids were opened on December 1, with five entities vying for the Rs 58,000-crore contract to manufacture 200 Vande Bharat trains and maintain them for the next 35 years.

While Rs 26,000 crore is the upfront payment on the delivery of the trains, Rs 32,000 crore will be paid to the winning bidder over a period of 35 years for the maintenance of these trains.

Vande Bharat is a semi-high-speed train with 16 self-propelled coaches — it doesn’t require an engine. It works on what is called a distributed traction power system, which is increasingly becoming the norm the world over for passenger operations.

Distributed power enables higher acceleration and deceleration compared to loco-hauled trains, which take much longer to reach the top speed or to gradually come to a halt.

These trains are better in terms of seating, an anti-bacterial system in the air conditioning system and the ability to hit 160 km/h in 140 seconds.

Vande Bharat push

The Centre had in the Budget 2021-22 set an ambitious target to manufacture 400 Vande Bharat trains in India by the end of 2024-25.

These trains, which are running on 10 routes, are pegged as a significant upgrade from the existing premium Rajdhani Express service.

After four years of intensive work and planning, India's first and second Vande Bharat trains were launched as electric multiple units in 2019 on the New Delhi-Varanasi and New Delhi-Katra routes.

The railway ministry is also working towards exporting these trains by 2026 to South Africa and some European countries.

Last week, Alstom and the Medha-Stadler consortium emerged as the only two players to submit bids for the Rs 30,000 crore-contract to produce and maintain 100 aluminum Vande Bharat trains for 35 years.

Also read: Indian Railways may again push the deadline for 100 Vande Bharat trains

The winning bidder for the Rs 30,000 crore contract to manufacture and maintain 100 aluminum Vande Bharat trains will receive Rs 13,000 crore upon delivery, with an additional Rs 17,000 crore to be paid over 35 years for maintenance.