Atmanirbhar Bharat: With Manufacturing of 80,000 Wheels a Year, Railways Close to Setting Up Factory

Taking a step towards the Centre’s Make in India initiative and becoming self-reliant, the railway ministry has opened a price bid for a tender to set up a forged wheel factory, which would manufacture at least 80,000 wheels every year for the next two decades.

“Tender was opened on January 24. Three bids have been received from M/s Steel Authority of India Ltd, M/s Bharat Forge, Pune and M/s Ramakrishna Forgings, Kolkata. Price Bid opened on March 14. L1 is from M/s Ramakrishna Forgings Ltd, Kolkata. L2 is from M/s Bharat Forge, Pune, L3 is from SAIL,” an official statement said.

Ramakrishna Forgings has quoted per tonne cost at Rs 1,88,100 while Bharat Forge at Rs 2,75,000 and SAIL at Rs 2,89,500.

It was in September 2022, that the ministry prepared a blueprint to become an exporter of wheels. To meet the requirement of forged wheels for the rolling stock, the Indian Railways had floated the tender for setting up a manufacturing plant in the country with assured offtake of 80,000 wheels per annum for the next 20 years so that the requirement is met from domestic sources. It will be an important initiative towards the Make in India plan for import substitution, the ministry said.

“Once the new plant is set up, the full requirement of forged wheels for locomotives and Coaching Stock will be met from domestic sources,” it added.

It is for the first time that the Railways had floated the tender to invite private players to build a wheel plant and make wheels for high speed trains in India. The ministry had said the bidding process was very transparent and competitive.

What’s Next

The successful bidder will set up the manufacturing facility within 36 months from award date and supply 80,000 wheels of various types per year. To consider the learning curve and economies of volume, the price applicable will be reduced by 2% every year up to three years. Fourth year onwards, the applicable price will be 94% of the quoted price, which is valid for the balance period of 20 years. The predetermined price variation clause is applicable for the price on a quarterly basis.

Existing Domestic Capacity and the Needs

Indian Railways has been importing various types of forged wheels required for locomotives and coaching stock (LHB) since the 1960s from the UK, Czech Republic, Brazil, Romania, Japan, China, Ukraine and Russia.

In 2022-23, nearly 80,000 wheels worth around Rs 520 crore were imported from China and Russia, with remaining 40,000 being sourced from SAIL.

Due to the Russia-Ukraine war crisis, all the import requirements of wheels were being met from China alone. The wheels of the Vande Bharat train were stuck in war-torn Ukraine and had to be airlifted to meet the timelines set for their production.

The Railways is expected to need 2 lakh wheels per year by 2026 due to induction of more and more high speed trains, according to official data.

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