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Indian Railways’ electrification thrust an opportunity for EPC companies

Infra News - Published on Wed, 03 Jan 2018

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Mint reported that the Indian Railways’ target to electrify all its broad gauge tracks by fiscal year 2022 can open up large opportunities for engineering, procurement and construction (EPC) companies. The national carrier has prepared an action plan to electrify 38,000 route-kilometres in five years, incurring an expenditure of INR 32,591 crore.

According to Elara Securities (India) Pvt. Ltd, the target represents a significant jump from an earlier plan. “The action plan’s target is 56% higher than an earlier plan of electrifying 90% of the network, or 24,400 route kilometres over FY17-21 announced in November 2016,” Elara Securities wrote in a note.

Importantly, the national transporter has plans to award individual tenders as large as 1,500km.

The report said that the move would not only lower electrification costs due to better economies of scale but also make the tenders more appealing for large companies. Indian Railways has hitherto been awarding tenders for smaller lengths, making it a time-consuming process.

Nevertheless, given the Indian Railways’ focus on capital expenditure and capacity augmentation, award of contracts is already on an upswing. Elara’s analysis of contract awards shows a sharp rise in the awarding of electrification projects in the first eight months of this fiscal.

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Posted By : Nanda Koijam on Wed, 03 Jan 2018
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