INDIAN Railways (IR) has issued a Letter of Acceptance for a contract worth an estimated Rs 580bn ($US 7.07bn) with two consortia to manufacture, supply and maintain 200 sleeper variants of the 16-car 160km/h Vande Bharat EMU.

The TMH-RVNL joint venture, a consortium of Russian manufacturer Transmashholding and Indian public-sector undertaking Rail Vikas Nigam, will build 120 trains, while the remaining 80 EMUs will be manufactured by a consortium of the Titagarh Wagons and the Bharat Heavy Electricals. 

IR officials say that formal contracts will be signed in due course, expected to be next month. The supply of the trains is worth Rs 240bn while the remaining Rs 340bn is for 35-years maintenance.

The trains will be built at IR’s Marathwada Rail Coach Factory located at Latur in Maharashtra. The selected firms are expected to upgrade facilities at the state-owned factory, with IR providing basic facilities including water and electricity. 

Financial bids were opened last month and revealed that TMH had offered to build each train at a cost of Rs 1.2bn, significantly lower than Stadler and Alstom, which had quoted prices of Rs 1.6bn and Rs 1.7bn per train respectively. 

The Titagarh-BHEL joint venture has since lowered its bid from Rs 1.4bn to Rs 1.2bn to match the price offered by the lowest bidder, in accordance with the terms of the tender. 

The two consortia are expected to produce two prototypes for trials by 2025. The trains are likely to be delivered at a steady rate from 2026 onwards.

However, with TMH currently having no presence in India and western companies unlikely to collaborate with the Russian firm, rail experts have expressed concerns about the company’s ability to meet the expected delivery schedules.

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