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Meltdown slows Lalu projects in race against EC

Railway Minister Lalu Prasad Yadav’s plan to start work on greenfield electric and diesel locomotive factories at Madhepura and Marhowra...

Written by Raghvendra Rao | New Delhi | Published: February 18, 2009 12:14 am

Railway Minister Lalu Prasad Yadav’s plan to start work on greenfield electric and diesel locomotive factories at Madhepura and Marhowra in home state Bihar before the model code of conduct for the Lok Sabha polls comes into force has run into an unforeseen wall — the global economic slowdown.

None of the three international players —- Alstom (France),Bombardier (Germany) and Siemens (Germany) —- who had been shortlisted after the technical bids for the Madhepura factory,have participated in the financial bid for the Rs 1,300 crore project.

For the Rs 1,400-crore Marhowra factory,only one out the two shortlisted players,GE, has put in the financial bid with the other player,EMD,opting out of the bidding process.

Top officials admitted the poor response to the financial bid,which closed on February 16,was a fallout of the economic recession. “The global financial situation appears to have taken its toll. These are projects which require substantial financial muscle and though some players have written to us that they were still keen to participate in the bids,the financial situation was not allowing them to do so,” a top ministry official told The Indian Express.

The Railway Ministry is now wasting no time in preparing a fresh Cabinet note seeking clearance from the Cabinet Committee on Economic Affairs to allow it to set up the Madhepura project through the “departmental” route.

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