The Ministry of Railways has sought the Cabinet nod for its Rs 29,000-crore project to manufacture diesel and electric locomotives at Mahowra and Madhepura in Bihar.
A senior official in the ministry confirmed it and said, “The projects have been sent to the Cabinet for approval.”
“The Railway Board has approved the proposal of setting up locomotive manufacturing units at Madhepura and Mahowra on a joint venture basis.”
While the Madhepura unit envisages building 120 IGBT-based electric locomotives of 12,000 Hp annually, the Mahowra factory will manufacture 130 diesel locomotive units a year.
The official said the Railways would buy 1,000 locomotives each from the two factories over a period of eight years. The investment envisaged for the purchase of such rolling stock is estimated to be around Rs 27,000 crore. The private sector entities awarded the contracts will also be responsible for the maintenance of these locomotives over a period of 25 years.
Though the factory at Mahowra was approved in 2006 and that at Madhepura in 2007, there is no progress in works due to lack of interest from potential bidders.
More From This Section
Another official at the ministry informed, “The projects had been put up for international bidding. In view of the global slowdown last year, we had considered setting them up as departmental production units. The Planning Commission and the Railway Board later suggested that they be taken up on JV mode.”
The Railways had floated a tender for setting up of the factories in April 2008. On receiving one non-compliant bid each for both the factories last February, the ministry had resolved to set them up as departmental units.
Railway Minister Mamata Banerjee also gave the go-ahead to the recommendations put forth by the Planning Commission.