Russia appears set to enter India’s rail market, after the partnership of Transmashholding (TMH) and Rail Vikas Nigam (TMH-RVNL) emerged as the lowest bidder for a Rs 580bn ($US 7.3bn) contract to manufacture 200 sleeper variants of the 160km/h Vande Bharat EMU at Indian Railways’ (IR) facilities at Latur in Maharashtra and Chennai in Tamil Nadu state.

TMH-RVNL quoted Rs 1.2bn for each 16-car train, while Alstom quoted Rs 1.6bn and the Stadler-Medha consortium quoted Rs 1.7bn. A consortium of Bharat Heavy Electricals (BHEL) and Titagarh Wagons quoted the second lowest base price of Rs 1.4bn when bids were opened on March 2. The Siemens-Bharat Earth Movers (BEML) consortium was the third lowest bidder at Rs 1.45bn.

If the tender conditions are to be followed, the contract to supply the 120 trains will be awarded to the lowest bidder. The contract will also include a 35-year agreement t to maintain the trains at depots to be set up at locations including New Delhi, Mumbai, Bengaluru, Jodhpur, Kolkata and Hyderabad.

A contract to build the remaining 80 trains will be awarded to the second lowest bidder, if it can match the price offered by the lowest bidder. If this is refused, the same offer will be made to the third lowest bidder. If none of the bidders are able to match the lowest price, the entire contract will be awarded to the lowest bidder. The second lot of 80 trains are due to be manufactured at the ICF facility at Chennai.

With major players including Siemens, Alstom and Stadler now out of the race, industry experts are apprehensive about TMH’s ability to meet the ambitious delivery schedules for the manufacture of 400 Vande Bharat trains by 2024-25.

While TMH is the largest manufacturer of rolling stock and railway equipment in Russia and has customers in Bulgaria, Belarus, Egypt, Kazakhstan and Serbia, the company currently has no footprint in India.