Rashtriya Ispat Nigam Ltd (RINL) has set in motion preparatory work for its proposed Rs 278-crore railway freight car axle project in West Bengal.
P. Madhusudan, Finance Director of RINL, told Business Line that the processes were initiated for a feasibility study, flotation tenders for the plant and machinery and the off-take agreement with the Railways.
The RINL unit is to be located on a 46-acre plot of land at New Jalpaiguri in the under-industrialised northern part of the State.
A 30-year renewable land lease agreement with the Railways has already been executed.
Railways consumption
RINL will pay an annual lease rent at a rate of 8 per cent on the land value, based on the (local) circle rate.
The proposed project would have the capacity to produce 50,000 pieces of axles a year. Each axel will have the load bearing capacity of between 22.9 tonnes and 25 tonnes and will be 210 mm in diameter. The new plant will have the facility of forging and heat treatment. At present, the Indian Railways depends on substantial imports of axles.
Off-take arrangement
Though the off-take deal is yet to be signed, it has been agreed that the Railways would purchase around 70 per cent of the production. The remaining output would be meant for local and overseas markets.
Madhusudan said Mecon was preparing the feasibility report for the project, which is expected to be ready for commissioning by the end of 2014.
The State-owned and Visakhapatnam-located steel maker would soon float tenders for the basic plant and machinery for the project.
For RINL, this project would be its first manufacturing outfit outside Andhra Pradesh.