Railways, to raise safety standards, takes this massive step, trashes rule that barred competition

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New Delhi | Published: November 1, 2017 6:16:30 AM

To widen the base of vendors and increase competition, Indian Railways has decided to do away with the rule wherein vendors approved by the Research Designs and Standards Organisation (RDSO) were the only ones eligible to bid for tenders for safety-related supplies.

Railways, safety standards, massive step, trashes rule, Indian Railways, Research Designs and Standards Organisation, Railway BoardIndian Railways, it has been decided that the earlier process wherein a vendor needed to be RDSO-approved to even apply for a tender will be revamped,” said a railway ministry official.

To widen the base of vendors and increase competition, Indian Railways has decided to do away with the rule wherein vendors approved by the Research Designs and Standards Organisation (RDSO) were the only ones eligible to bid for tenders for safety-related supplies. According to sources, railway minister Piyush Goyal has suggested opening up the registration for all vendors who fit within the specifications given by RDSO, an arm of the railways, so that competition is not limited. “To break the so-called cartels which more than often used to win tenders for safety-related supplies to the Indian Railways, it has been decided that the earlier process wherein a vendor needed to be RDSO-approved to even apply for a tender will be revamped,” said a railway ministry official. The RDSO registers vendors for various supplies including for signalling, telecommunication and traction installation, apart from civil, mechanical and electrical engineering. The transporter is in the process of making huge investments in the next five years, especially in safety-related projects, given it has emerged as the prime focus of Goyal on the back of multiple lapses in the recent past leading to mishaps, which have even claimed lives. The minister on Sunday said the railways will be investing $150 billion, or around Rs 9.7 lakh crore, in the next five years.

A part of this investment has already been envisaged during the the tenure of former railway minister Suresh Prabhu who planned to invest Rs 8.5 lakh crore in five years staring 2014. The development also comes at a time when the railways is preparing bid documents for awarding contracts for 100% electrification in the next four years. Last week, Goyal, while addressing an event, asked officials to prepare an incentive-cum-penalty programme for vendors in order to implement the electrification plan in a time-bound manner and also suggested to standardised design so that vendors are not required to run for approvals and projects should be awarded in a transparent manner.

During the same event, Ghanshyam Singh, member-traction, Railway Board, said bid documents are being tweaked to widen the vendor base for electrification projects. The RDSO has a process of examining manufacturing processes and plants before vendors could register to bid for contracts to supply material to the railways. “The minister has asked to open the registration process to anybody those who want to apply,” said the official. The process, however, was deemed to be limiting competition. “If large number of parties are registered, the so-called cartels which are there at some places will get blocked,” added the official.

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