Indian Railways cancels Rs 30,000 cr tender for 100 Vande Bharat trains

Indian Railways has scrapped its Rs 30,000-crore tender for the production and maintenance of 100 Vande Bharat trains, as reported by MoneyControl and confirmed by Olivier Loison, managing director of Alstom India.

The cancellation comes after the railways found the price quoted by the lowest bidder, Alstom India, to be ‘too high’. According to the report, the French multinational company had quoted a price of Rs 150.9 crore per train. However, the railways wanted to seal the deal at Rs 140 crore per train.

As only two players participated in the bidding process, railways also felt that a new tender may attract multiple players and ensure a competitive price. Besides Alstom, the other bidder was a consortium, comprising Swiss railway rolling stock manufacturer Stadler Rail and Hyderabad-based Medha Servo Drives.

The tender, which has been cancelled, was opened on May 30, 2023. It was floated in 2022 to invite companies to manufacture 100 aluminium body Vande Bharat trains within seven years. The Indian Railways specifically wanted aluminium trains because aluminium train sets are lighter and more energy-efficient than those made of stainless steel.

So far, the Indian Railways has not issued any statement on the cancellation of the tender. However, Loison has confirmed the development to MoneyControl saying, “Indian Railways has cancelled the tender.

However, with our strong local knowledge and investments in industrial and human capital over the years, we are well-positioned and committed to supporting the realisation of this vision [of the railways] in the future, should the opportunity arise.”

Previously, the contract to manufacture 200 Vande Bharat sleeper train sets – all made of stainless steel – was granted at Rs 120 crore per train.

Vande Bharat trains: Railways staring at lack of bidders?

Initially, railways anticipated at least five bidders for its Rs 30,000 crore tender. However, several of them failed to meet the technical requirements. As per the terms of the contract, companies must have a research and development (R&D) facility to ensure that they can manufacture a prototype and also can assemble at least five train sets a year.

According to the tender, the winning bidder will receive Rs 13,000 crore upon delivery of the train sets and the remaining Rs 17,000 crore for maintenance over 35 years.

Vande Bharat is a semi-high-speed train consisting of 16 self-propelled coaches, which eliminate the need for a separate locomotive. These trains come with better seating, an anti-bacterial system in the air conditioning, and the ability to accelerate to 160 kilometres per hour in only 140 seconds.