Indian Railways is looking to reduce import dependence for forged wheels for its trains and locomotives. In this regard, it has received three bids - from Steel Authority of India Ltd (SAIL), Bharat Forge, Pune, and Ramakrishna Forgings, Kolkata - to build a manufacturing facility with an annual supply of 80,000 wheels of various types for the next 20 years.

Ramakrishna Forgings is the L1 bidder having quoted a price of ₹1,88,100 per tonne; followed by Bharat Forge at ₹2,75,000 per tonne; and SAIL being L3 at ₹2,89,500 per tonne. The tender was opened on January 24 and price bids were opened on Wednesday.

The current import bill for procuring forged wheels is pegged at ₹520 crore approximately for 80,000 wheels, mostly sourced from China. Another 40,000 – odd is being sourced domestically from SAIL, with the average rate being ₹1,87,000 per tonne. .

Boost for Make in India

Requirement of wheels is projected to increase up to 2,00,000 by 2026 following the expected induction of high speed trains. “Currently, due to Russia-Ukraine crisis, all the import requirement of wheels is being met from China,” a government statement said

The railways have been importing various types of forged wheels since 1960s from the United Kingdom, Czech Republic, Brazil, Romani, Japan, China, Ukraine and Russia.

“Once the new plant is set up, full requirement of forged wheels for locomotives and coaching stock will be met from domestic sources. This is an important initiative in the direction towards Make in India for import substitution,” the statement said.

Existing domestic capacity for SAIL stands at 40,000 wheels; whereas for Rashtriya Ispat Nigam Ltd (RINL) it is 80,000 wheels. The latter is yet to start regular commercial production.

Applicable price

According to the railways, the successful bidder will set up the manufacturing facility within 36 months from award date.

To consider the learning curve and economies of volume, the price applicable will be reduced by 2 per cent every year up to 3 years and the fourth year onwards the applicable price will be 94 per cent of the quoted price, which is valid for the balance period of 20 years, the statement said.

The pre-determined price variation clause is applicable for the price on quarterly basis, it added.