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The Rs 3,000-crore diesel train engine factory in Bihar may be scrapped; Bihar CM to use his political clout to scuttle the Railways plan

The proposed Diesel Engine Project in Bihar's Chhapra, billed as the country's biggest Make in India project -- may be scrapped, with the Railway Ministry toying with the idea of shelving the  Rs 3000-crore initiative that's expected to roll out by October 2018.

Bihar already has a factory to manufacture electric railway engines near Patna as Ministers from the state had the railway ministry for nearly 25 years. The electric engine factory is expected to be commissioned in a few months

The Railway Ministry is of the view that since electrification of railway tracks going ahead in full steam, investment in diesel engines would not pay off in the coming years.

Mr Nitish Kumar, who has handled the railways portfolio twice, however disagrees and insists on the project to be set up in his home state.

Indian Railways is the third largest railway network in the world and full electrification of the 1.1 lakh-km tracks will take a long time, Mr Kumar argues. Till then, having fuel-efficient diesel engines will be cost-effective. Besides, once full electrification is done, India may even sell the diesel engines to neighbouring countries that are yet to modernize their railways, he said.

The Indian Railways believes that investing in diesel engines will not pay off and therefore are planning to shelve the unit on economic grounds. It remains to be seen if Mr Nitish Kumar uses his political clout with the NDA government to scuttle the idea.

Bihar has the biggest factory to manufacture electric engines at Marhaura, billed as the biggest Make in India project is expected to roll out 1,000 fuel efficient diesel-electric evolution series locomotives within 10 years. The emissions-compliant diesel locomotives would be a first in the country.

The project had been the brainchild of then railway minister Lalu Yadav, who wanted to build a state-of-the-art factory. The project was awarded to the US multinational General Electric two years ago, which has already built two locomotives in its US-based factories.

The first engine has been shipped and it will arrive in India on October 10. Sources in the company said if all goes well, the factory near Patna may be commissioned much before its scheduled date.

A few months ago, Mr Goyal, who was then the Union Power Minister, also put a 4000 MW ultra-power project in Bihar's Banka on hold, saying unless the state entered a power purchase agreement, the Centre would not sanction funds to start work. The project had been given to state in the Prime Minister's package announced just before assembly elections in 2015.

The power purchase agreement commits the state electricity board to buy power produced at the plant at a specific rate and once payment is not made the supplies will be cut off. The states in the Hindi heartland especially Uttar Pradesh and Bihar owe the central power plants thousands of crores of rupees by way of arrears and unless an agreement is in place power supplies could not be cut off.


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