Chinese company cries foul over clause in Madhepura loco project

Written by fe Bureau | New Delhi | Updated: Oct 4 2013, 01:10am hrs
Chinese technology giant CSR Zhuzhou Electric Locomotive, which has evinced interest in the Madhepura electric loco project of Indian Railways, has accused the railway board of unfair practices to make the project uncompetitive for it.

The company, in a letter to the railway board, said unnecessary conditions in the RFQ are restricting the project from being uncompetitive. It is unfair for us to be prevented to participate in the project from the RFQ stage, it says. The letter criticised the railway board's condition that a company applying for the project should have worked in at least three countries in similar line of operations.

But the railway board denied any bias, saying the condition was included to get the best of technology into India.

We wanted a well-tested system. That's why this 3-country condition was included and it was cleared by the Cabinet in May 2013. A firm cannot question it just because it does not fulfil the criteria, said a railway board official.

The controversial R1,293-crore electric loco factory project (along with the diesel loco project in Marhowra) was announced by then railway minister, Lalu Prasad, in 2006 after which the tendering process was initiated in August 2008. Four companies were shortlisted. In 2009, the RFP was approved by the Cabinet, but only one bid came forward.

So, the railway ministry went back to the Cabinet, saying that the JV route didn't materialise and asked for the permission to take the public undertaking route for the project for which the Cabinet gave its approval. This was just before the 2009 general elections.

After UPA-II came back to power, the railways again approached the Cabinet saying the market had improved and going ahead with a JV would be beneficial. The Cabinet approved the move.

The same companies came forward again. An empowered committee set up for the project wanted some changes made in the bidding documents after considering the concerns of bidders. In this backdrop, an EGoM was formed, which was of the view that since a lot of conditions in the bidding documents were to be changed, it was better to go for fresh bids. The approval for fresh bids came in May.