Turnaround saga of Indian Railways

IANS First Published : 21 Feb 2009 07:40:09 PM ISTLast Updated : 21 Feb 2009 09:09:57 PM ISTNEW

DELHI: The turnaround saga of the world’s second largest railroad network, scripted by an unlikely candidate, Railway Minister Lalu Prasad, first caught the attention of the best-known management schools. This amazing story of the 156-year-old Indian Railways over a short span of just five years has now been captured in a book.

The book, titled “Bankruptcy to Billions”, takes the reader through the short but intriguing journey of how the organisation that once defaulted on dividend payments, turned in a cash surplus of $18 billion by 2008 – without any hike in fares, freight rates or retrenchments.

As Lalu Prasad looked on proudly, President Pratibha Patil was presented this 228-page book, published by Oxford University Press, by its authors Sudhir Kumar, officer on special duty with Indian Railways, and Shagun Mehrotra of Columbia University.

“This book on the transformation of the Indian Railways describes how progress is possible while benefiting, rather than burdening, the poor,” Prime Minister Manmohan Singh says in his foreword.

The Indian Railways runs some 13,000 trains each day, including passenger trains, over a network of 63,000 km, to ferry some 17 million passengers and two million tonnes of cargo each day between 7,000 stations.

Kumar, a member of the Indian Administrative Service (IAS), recalled how the numbers spoke for themselves, resulting in the transformation that started from near bankruptcy and deterioration of operating ratio to 98 percent in 2001.

“The same railways generated a cash surplus of over $6 billion in 2007-08 and on the benchmark of net profit it would have joined, if we were a corporation and not a government department, the elite group of Fortune 500 companies,” Kumar says.

He also lists some of the strategies that led to the turnaround, that may sound basic but played an important role: These include faster, heavier, longer trains; free upgrades for passengers; e-ticketing; and yield per trans as opposed to rate per passenger or tonne.


Railways to celebrate 40 years of Rajdhani trains

The main function will be held at Howrah station, with Railways planning to recreate a festive-like atmosphere at the station complex on March 3, the day when it was flagged off from there.

The country’s first Rajdhani express — the Delhi-Howrah Rajdhani — will complete 40 years of service on March one and the Railways have geared up to celebrate the occasion with a huge cake and a special menu for passengers.

The first Rajdhani was flagged off from New Delhi station in 1969 as a bi-weekly train to provide faster connectivity between metros. Operating at a speed of 120 kmph, it stopped only at Kanpur, Mughalsarai and Gomoh for operational reasons.

In the course of time, its success led to introduction of Mumbai Rajdhani and several more. Today, as many as 16 Rajdhanis connect Delhi to the state capitals.

The main function will be held at Howrah station, with Railways planning to recreate a festive-like atmosphere at the station complex on March 3, the day when it was flagged off from there.

“The entire train rake will be wrapped with fancy stickers and passengers will be presented with mementos and brochures,” said an Eastern Railway official, adding, “the brochures will contain the train’s history.”

Northern Railway is still to draw up a plan to commemorate the day.

Indian Railway Catering and Tourism Corporation, which serves food only in Rajdhanis, is planning to prepare a special menu to commemorate the day. A huge cake will also be cut before the train departs.

In the course of its history, the Delhi-Howrah Rajdhani has been witness to several ups and downs. While it was involved in a major accident in September 2002 near Gaya, it was also the first Rajdhani to be accorded ISO 22000 certificate for the overall train management.

It was among the first to get state-of-art LHB coaches for enhanced passenger comfort and a new advertising source for multinationals.

As it enters its fortieth year, Railways are now planning to provide Internet facilities in all Rajdhanis and satellite phone connections in a few of them.


Published in: on February 19, 2009 at 4:56 pm  Leave a Comment  
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Goa Carnival Tourist Train

PANAJI: It is that time of year when groups of friends, young couples and large families with their relatives in tow stop at nothing to find their
way to Goa. The annual carnival celebration, which has become one of the most awaited events in the state and attracts thousands of people year after year, will begin this weekend.

For the first time ever, the Indian Railways has organized a special package tour from Ahmedabad to Goa christened the Goa Carnival Tourist Train in its attempt to attract tourists. The train will leave Ahmedabad on a four-day, five-night trip to Goa on February 20 and will return on February 24.

The Indian Railway Catering and Tourism Corporation (IRCTC) has also decided to include Gujarati food in the special package for the Goa carnival. The special package includes a return ticket, air conditioned hotel accommodation, vegetarian meals and tourist escorts including sightseeing trips. The train will make stopovers at Vadodara and Surat in Gujarat, and in Mumbai before arriving Goa.

Meanwhile, the Goa Tourism Development Corporation (GTDC) has recorded almost 100% bookings in advance for its residencies at Panaji and Miramar, while Mapusa and Margao have crossed 60% in advance bookings.

“Almost 40 packages have been sold in advance, coinciding with the carnival. We have got even more free-of-itinerary (FIT) tourists,” said officials.

The packages snapped up by the Indian tourists include honeymoon specials and beach bumming’ packages.

Hoteliers in Panaji are also gearing up for the expected deluge of tourists. “Carnival has always evoked a lot of interest in tourists. This year we are expecting more than 80% occupancy,” a hotel owner said.

Hotels and resorts along the coastline are also drawing up programmes of their own. “A lot of FITs are expected to arrive from the metros of India,” explained hotel owner and Travel and Tourism Association of Goa (TTAG) president Ralph de Sousa.

“We’re having in-house programmes, theme evenings and fancy dress contests for our guests. Special menus with carnival themes will be prepared during the festivities,” he said.


India’s first Light Rail Transit System (LRTS)

West Bengal Chief Minister Buddhadeb Bhattacharjee laid the foundation for the country’s first Light Rail Transit System (LRTS) here today, setting in motion a Rs 6,000-crore project for elevated mass transporation of passengers within the city and its outskirts.

To be implemented by a Special Purpose Vehicle (SPV), led by the city-based SREI Infrastructure Finance Limited, the project would have technological support from the Czech-based Amex International, one of the consotim partners. West Bengal Infrastructure Development Ltd, a state Government undertaking, is the third member of the SPV.

Aimed at easing the city’s severe traffic congestion by carrying passengers across the sky, it will be executed in two phases approximately by 2013-14.

Speaking on the occasion, the Chief Minister said the airconditioned LRT would connect a total 40 km stretch in two corridors between Joka in the northern suburb and Esplanade and Esplanade and Barrackpore on the southern end, covering 37 stations.

He also announced that the East-West Metro system, the second underground railway corridor in Kolkata between Salt Lake and Howrah, was almost final, while the proposal for a 50 km elevated ring road around the city was underway. ” The LRT system will be combined with the East-West metro in our effort to clear passenger traffic through fast moving mass transport system in a city of six million people where one million more visit everyday for livelihood. The LRT will meet the East-West metro system at Sealdah where passengers would be able to avail of the overhead rail road after travelling underground or vice versa, ” he said.

Mr Bhattacharjee urged SREI to submit the Detailed Project Report for LRT within this year so that work for the project could start next year.


Germany keen on PPP projects with railways

NEW DELHI: Germnay and India could co-operate in automobile and transport sectors, German minister for transport, building and urban affairs
Wolfgang Tiefensee said. “We have met the Railways and discussed public-private-partnership projects for upgrading the infrastructure of Indian Railways,” Mr Tiefensee told ET during his recent visit to New Delhi.

Representative of the German government had visited India last year to meet officials of the Indian Railway Board regarding technology transfer for various railway infrastructure projects, including wagons and bogies.

During Mr Tiefensee’s India visit earlier this month, the two countries also formed a joint working group (JWG) on automotive sector. Speaking at the meeting, minister of heavy industry & public enterprises Sontosh Mohan Dev said that the challenge before this JWG would also include “initiating steps for quality improvement, enhanced productivity through possible joint ventures and technology sharing”.

Pointing at the current economic slowdown, he said that it was essential for auto companies to maintain their tempo for R&D investments. “In this context, India is in a unique position of having twin advantages of possessing one of the largest pools of talented scientists, engineers and technicians in the world available at extremely competitive costs.

We believe that given the strength of Germany in the area of R&D, our countries can gain from vast synergy through R&D and technology co-operation and tie-ups,” he said.

Speaking about the tie up, the German embassy said that the JWG would particularly intensify Indo-German co-operation in the development of efficient automotive technologies and alternate fuels and drives. “Germany and India agree that the energy strategy for the automobiles of the future has to be geared towards meeting the challenges of environmental protection and the reduction of energy consumption,” it said in a statement.

Germany is a strong supporter of a resolute policy against climate change. “The German government stands by its commitment to reduce CO2 emissions by 40% from 1990 to 2020 if the EU reduces its emissions by 30% and other nations act in a comparable way. Furthermore, within its energy consumption, Germany will increase the proportion of renewable energies to 25-30% by 2020,”


Video-cum-train info display likely

Hyderabad-based LED display company MIC Electronics Ltd has received Research and Design Standards Organisation (RDSO) approval from Indian railways for its ‘true colour video-cum-train information display system’, both indoor and outdoor.

This system takes imaging data from satellite imaging for rail navigation (SIMRAN) and displays station-specific train information in three languages — English, Hindi and the local language of the station.

MIC has already installed this unmanned system with SIMRAN synchronisation at the Patna railway station. The system when fully operational will take away the long queues of passengers from the manned enquiry counters and enhance passenger convenience.

The Indian railways plans to install 100 such boards at category A and B stations across the country.


Railways bucks downturn, to remain on growth track

Indian Railways will stay on growth track in 2009-10 projecting cash surplus of Rs 18,847 crore after cutting most of the passenger fares, even as economic slowdown affected its freight business.

Even as its industrial customers face a crippling slowdown, the Railways expects to earn gross traffic receipts of Rs 93,159 crore in 2009-10, exceeding the revised estimates for the current fiscal by Rs 10,766 crore. Passenger fares for second class (above Rs 50) as also for the luxury trains have been reduced by two per cent.

The pace of expansion is affected by the global downturn impacting the Indian business, but the balance-sheet of the country’s largest transporter remains robust.

Expenses (operating ratio) would a tad higher at 89.9 per cent because of increased salary bill after implementation of the Sixth Pay Commission in the next financial year as compared to 88 per cent in the current fiscal.

As the rest of the economy is grappling with business setbacks, the Railways would pay a higher dividend of Rs 5304 crore to its owners — the government.

“…Railways have kept the human aspect as the central focus and achieved an extraordinary feat without puttany extra burden on the common man or the employees,” Railway Minister Lalu Prasad said while presenting the interim Budget in Parliament today.


Published in: on February 18, 2009 at 3:19 pm  Leave a Comment  

Two mega rail engine projects get just one bidder each

New Delhi: German engineering services company Siemens AG and US-based conglomerate General Electric Co. (GE) have emerged as the sole bidders in separate contracts for an ambitious $6 billion (Rs29,220 crore) Indian Railways project to manufacture electric and diesel locomotives.

Three of the five companies in the running for the project have not bid amid concerns about the terms and the efforts of the railways in the last two months to accelerate the project announced two years ago.If Siemens, GE get the project, it could raise questions on the price quoted, in the absence of any competition
A government official, who did not want to be named, said that if the railways did go ahead and award the project to Siemens and GE for two factory tenders, it could raise uncomfortable questions on the price quoted by the winning bidder in the absence of any competition.
Most company officials did not want to be named because the bid process was still “live”.

On 3 February, Mint had reported that railway minister Lalu Prasad planned to fast-track proposals for this project. The railways confirmed that it had received only one bid each for the factory tenders.

The project envisages manufacturing electric locomotives at Madhepura and diesel ones at Marora, both in Bihar, the home state of Prasad. GE bid for the diesel locomotive factory; Siemens for the electric locomotive one.

The shortlisted companies that failed to submit bids were Bombardier Transportation India Ltd, a unit of Canada’s Bombardier Inc., and France’s Alstom SA for the electric locomotive project and EMD Locomotive Technologies Pvt. Ltd, a subsidiary of the US-based Electro-Motive Diesels Inc., for the diesel project.

“There is a possibility that the players didn’t see that this is going to happen in such a short period of time. Otherwise most of those players should have bid. Most of the companies were very keen on the project,” said Arvind Mahajan, an executive director with audit and consulting firm KPMG Advisory Services Pvt. Ltd.

An official handling one of the tenders said that GE would be awarded the contract since its competitors had failed to submit a bid. “This is final as the others have not submitted their bids,” he said on the condition of anonymity.

Confirming that GE had submitted a price bid, a GE spokesperson said, “We submitted what we consider a competitive bid for the diesel locomotive tender Indian Railways issued in September 2008… We remain cautiously optimistic that Indian Railways will consider our bid favourably. Next steps in the bidding process will be determined by Indian Railways and the government, we eagerly await their decision.”
Alstom and Siemens officials did not respond to emails seeking comment. A Siemens executive, who did not want to be identified, confirmed that the company had submitted a bid, but refused to share more details.

Another Railway Board official handling the electric locomotives contract said that while Siemens was the only company to submit a bid, another company had sought an extension.
Refusing to disclose the name of the company, this official said, on condition of anonymity: “There is no precedent as such of allowing others now, but there are a number of ways of taking such circumstances into consideration.”

Technically, the railways can award the projects despite receiving only one bid each, though some ministries, such as the roads ministry, have chosen to approach the cabinet to clear the awards of such projects.
An official from one of the companies participating in the electric locomotives tender said they had submitted a letter to the Railway Board putting across their “point of view” on the tender.

However, he insisted the letter was not a protest note and was only an effort to get some clarifications from the ministry.

The railways had issued revised draft request for proposals (RFPs)—essentially guidelines for final price bids—in the last week of January, with a deadline of 16 February. This was finalized when the Cabinet Committee on Economic Affairs cleared the project on 5 February, which some companies claim left them with very little time.

The winning bidder is decided based on the price they bid per locomotive, with all other costs, including maintenance costs, built into the price.

The projects were cleared for investment as joint ventures on 5 February despite the objections by the ministry of finance over many of the conditions laid down in the bids.
The clearances came after a round of inter-ministerial consultations to take the project forward.

The two projects—estimated at a combined $6 billion—include a procurement contract as well as a 15-year maintenance component, where the railways would pay 3.25% of the cost of the locomotive every year to the winning bidder for maintenance.
The winning bidder was also required to build a township, school and hospitals near the factory.

Railway equipment manufacturer GE Transportation, a unit of GE, will tie up with state-owned Bharat Heavy Electricals Ltd (Bhel) to manufacture the diesel locomotives, provided it wins the order estimated to be worth more than Rs10,000 crore.
“Once the tender is awarded to us, we (Bhel) are looking at a total investment of Rs1,000 crore,” he said.


Arshiya Rail Infrastructure plans 30 rakes in phase-I

Project Monitor reported that Arshiya International has planned to roll out 30 rakes over the next 15 months.

Railway operations were launched on February 2nd 2009, with the very
first rake pressed into service at Jharsuguda in Orissa. The rake will offer customized rail transport solutions to Vedanta Aluminium Ltd that is building aluminium smelting capacity in the eastern state.

The 30 rake roll out that constitutes phase-I of Arshiya’s railway operations will be spread over 15 months, at an average rate of 2
rakes per month. The INR 1,600 crore railway business will come under
Arshiya Rail Infrastructure Ltd, a wholly owned subsidiary of Arshiya
International Ltd, formed in April 2008 when Indian Railways granted a pan India licence.

The official said that for phase-I of the plan, equity infusion has already taken place and the company is in the final stages of mobilizing debt. ARIL’s eventual plan is to have 75 rakes in
operation, making it the largest private railway operator in the country. Arshiya’s early routes will mainly focus on providing east to west and east to north connectivity in India.

Mr Ajay S Mittal CMD of Arshiya International Ltd in a statement
that “We are confident that the rail services, combined with the services to be provided at the free trade warehousing zones, will present a substantial value proposition to our customers.”

Arshiya International Ltd in August 2008 also placed an order on
Finland based Kalmar Industries for sourcing seven E One+ rubber- tyred gantry and 10 reach stackers. These new units will be deployed at Arshiya’s proposed free trade warehousing zones in India and Middle East. Some equipment will also be used at its railway terminals across India. Meanwhile, Arshiya International is expected to soon start work on the Mumbai Free Trade Warehousing Zone.

Despite, the ongoing economic slowdown, long-term prospects for
private players remain bright for railway container operations. India
is expected to handle 200 million tonne of rail based container cargo
by 2011-12 against 20 million tonne today.

Much of this handling is likely to be propelled by private operators. Industry experts also feel that the advent of private players will also bring about greater efficiency in the overall Indian logistics industry. Currently, logistics costs account for 13% to 15% of the country’s GDP. Private sector participation will bring about greater efficiency leading to a much lower incidence of logistics costs, experts feel. Indian Railways opened up container train services to
the private sector in October 2006, ending the monopoly of public
sector Container Corporation of India Ltd.

(Sourced from Project monitor)

Science Express, a laboratory on wheels

Rajahmundry: When the project staff of ‘Science Express’ are explaining about ‘Origins of Man’ the students and teachers of Sri Harshavardhana School are spell bound in an air-conditioned coach. In another coach Sasank, Pranav and his friends from Trinity School and Bharat, Sai Surya from VT Government High School were mesmerised when they saw a future car and came to know about how it works.

Hundreds of school students along with their parents or teachers, college students, teachers, elders lined up for the last three days to visit ‘Science Express’ – the World of Science.

It started with 13 A.C. coaches in last December from Delhi’s Safdar Jung Railway station and continued its journey through different States covering 17,000 kms.

The train reached Rajahmundry on Saturday.

There are 300 science instruments and 150 video clippings in this mobile exhibition which attracts each and every spectator. From ‘Big Bang’ experiment to rocket launching from Sriharikota every new science development has a place in this train.

Electron, proton, atom, changes in nature, organism, space and space cars, and satellites and number of other items were displayed.

Ch. Bhaskara Subrahmanyam, Station Superintendent of Rajahmundry, said that about 10,000 students, teachers have visited the exhibition.

On the last day visiting hours of exhibition have been extended by one more hour.

Mayor A. Veeraraghavamma, Nannya University Vice-Chancellor K. Niruparani and other VIPs also visited the exhibition.


Published in: on February 17, 2009 at 3:26 pm  Leave a Comment