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L&T, GMR, BHEL among 15 firms in race to operate trains

The list includes Indian corporate majors like Larsen and Toubro, GMR, and PSUs BHEL and IRCTC, though big names in the Indian private sector like the Tatas, Vedanta and Adani are missing.

Written by Avishek G Dastidar | New Delhi |
Updated: October 8, 2020 1:13:04 am
indian railways, lockdown, coronavirus, covid19 pandemic, india, delhi, chennai, mumbai, kolkata, railways, local trainsSoon after the lockdown was announced in March and regular train services were suspended due to the pandemic. (File)

After 23 companies showed interest, finally 15 formally came forward to participate in the bid to run trains in India on more than 100 routes based out of 10 cities as Indian Railways gives up its monopoly in passenger train operations.

The list includes Indian corporate majors like Larsen and Toubro, GMR, and PSUs BHEL and IRCTC, though big names in the Indian private sector like the Tatas, Vedanta and Adani are missing.

Firms connected with highway construction like PNC Infratech, IRB Infra Developers, Welspun, Megha Engineering, and Singapore-based Cube Highways, too, have submitted the Request for Qualification.

Players like Sainath Sales, which is into hospitality and toll collection; railway logistics firm Gateway Rail, services company in aviation sector Arvind Aviation; Malempati Power; and CAF, the Spanish rolling stock makers are also in the race.

Railway catering major RK Associates is one of the contenders in several clusters. Apart from bidding on its own, it has partnered with IRCTC for the Bengaluru cluster through one of its subsidiaries, Comesum.

Companies that had shown interest in the project by participating in the last pre-bid conference but then decided to stay away include Vedanta Group’s Sterlite Power, international rolling stock firms like Bombardier and Alstom, defence PSU BEML, and Titagarh Wagons.

Railway officials said that considering the prevailing market and the value proposition—a new, untested market for private investment—the response is good enough to ensure competition in the bidding stage.

Sources said that a lot of back-channel reaching out by officials at various levels took place to get many big names to participate. The project is being piloted by an Empowered Group of Secretaries headed by NITI Aayog CEO Amitabh Kant. A few weeks ago, Kant and his counterpart in Railways V K Yadav made a strong pitch for the project through an “international press conference”.

Routes based in 10 cities like Delhi, Mumbai, Patna have been divided into 12 clusters, which will run a total of 151 private trains plying between 140 origin-destination routes. Each cluster is a separate business entity.

Between the 15 companies, the 12 clusters have received 120 applications. Each cluster has received at least nine contenders. Bengaluru got 11 bidders while Mumbai-2 and Delhi-2 clusters received the highest — 12 applications each.

The criteria for qualification was just financial strength based on net worth. Railways did not have any technical criteria for participating companies. “Ministry of Railways has received excellent response,” a press release from Railways said on Wednesday.

In the Request for Proposal stage, these companies will be selected based on the share of yearly revenue they offer Indian Railways.

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