Railway minister Piyush Goyal has ruled out the possibility of the
government scrapping a contract with US giant, General Electric (GE) , to
supply and maintain 1,000 diesel locomotives.
The first batch of diesel locomotives from GE are expected to arrive in
India in early October, Mr Goyal said, dismissing reports which speculated the
government would have to pay damages to the American conglomerate if the
contract is terminated.
“The Marhaura project is on track...I have had fruitful discussions with
the South Asia and India head of GE,” Goyal said at a press conference on
He added that the government’s focus is on electrification of the Indian
railway network but clarified that these plans will not jeopardise the contract
with GE for manufacture of diesel engines.
The decision to push for electrification comes from the need to save funds
needed for modernising the world’s fourth largest rail network.
Currently, India’s manufacturing capability of electrical locomotives is
only 200 a year by the Railways. Another plant built by Alstom at Madhepura
will supply another 80 per year.
As per the electrification plans, the Railway network would need around
4500 electric engines, fueling speculation that this would make GE’s diesel
locomotives redundant. The American major does not manufacture electric
Goyal ,who took over as railway minister recently, is keen on extensive use
of electric locomotives, while the existing fleet of 1500 diesel locomotives
will serve as a backup.
I am very keen that we should electrify the entire railway network. My
mission is 100 per cent electrification. Electricity is a domestic and
self-sufficient resource whereas we have to import diesel. Railways is spending
a sum of Rs 16,000 crore every year in diesel consumption. So, I will save Rs
8,000-10,000 crore,” Goyal had said earlier.
GE is developing a Diesel locomotive factory at Marhoura in Bihar and a maintenance
shed in Uttar Pradesh. As per the project plan, the factory will provide India
with 800 diesel locomotives over the next decade.
GE also has a $2.5 billion contract with the railways for importing 1,000
additional diesel locomotives.