Wagon industry welcomes prospects of higher production

The wagon manufacturers see demand from the Railways to grow substantially in the next fiscal entailing a positive direction for a long-term growth.

Though the Railways’ procurement size remains the same, the final placement of orders for the last floated tender for 2009-10 has not taken place yet. As the industry does not suffer from capacity constraints, industry captains have welcomed the prospect of higher productions.

There are six to seven wagon makers in the country and half of it is in the private sector. A few have already got into making of steel wagons and are planning to enter aluminium wagons too. Some of them are also poised to diversify into locomotive shells, EMU coaches and components.

Target

According to Mr Umesh Chowdhary, Managing Director of Titagarh Wagons, the 2010-11 Railway Budget has set a target of procuring 18,000 wagons. “This means the industry is likely to be asked to effectively produce around 30,000 wagons as 2009-10 will have an order carry-over of 12,000 wagons into the next fiscal”, Mr Chowdhury observed

Mr Pawan Ruia, Chairman of Jessop, which has mild-steel wagon making capacity and has embarked upon a plan to produce steel wagons, welcomed the decision to set up five wagon manufacturing units and a DMU manufacturing unit in public-private partnership mode.

In view of current scarcity of wagons and coaches, Mr Ruia considered the Budget promise of introduction of modified wagon investment scheme a positive move.

“The immediate increase of 1,000 route km during the financial year 2010 is a bold step towards future plan of 25,000 route km within 2020.

“However, we’d be happier if the target of procuring new wagons for the next year was increased from the level of the current year”, Mr Ruia said.

The targeted 944 million of tonnes of freight loading for the next year should be a benchmark and Jessop & Co Ltd was geared up to rise to the occasion to deliver the rolling stock needed for it”.

Industry insiders said the Budget has set long-term direction for significant improvement in railway infrastructure and set in motion a process for greater private partnership along with a promise of removing procedural bottlenecks and delays.

“Investments in building infrastructure and introduction of technology from private sector may pour into manufacturing of special wagons, coaches and locomotives once delay in project implementation and procedural hurdles are removed,” said a senior industry official.

http://www.thehindubusinessline.com/2010/02/26/stories/2010022651291702.htm

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