Cabinet approves rail coach factory at Kolar

Project to see investment of Rs 1,461 crore

The Cabinet today gave its approval for setting up of a new rail coach manufacturing unit at Kolar to manufacture 500 coaches per annum at an estimated cost of Rs 1,460.92 crore. The project involves participation of Karnataka government in the form of land. The Ministry of Railways will finance 50 per cent of the cost and the Government of Karnataka shall provide the required land, free of cost as well as meet the remaining 50 per cent of the project completion cost with escalation, a press note issued by the government said.

Land to the extent of about 1,118.38 acres shall be provided free of cost by the Government of Karnataka. The proposed plant would help Indian Railways in ensuring timely availability of passenger coaches to meet the increasing demands of passenger transportation.

Earlier, in January this year, the ministry of Railways signed an MoU with the government of Karnataka for the implementation of the project. As per the MoU signed today, both the Karnataka government and ministry of railways have agreed to share the cost of the project and any further cost escalation.

The cost of the project excludes the cost of land,which will be borne by the state government. The state government already possesses 550 acres and it would acquire the balance land and handover to the railways. The project will be completed in a five years' time frame by March 2019.

The proposed factory will employ about 10,000 persons, once it is fully completed. According to the ministry of railways, the requirement of rail coaches is estimated at 33,000 units during the 12th Plan period and 37,000 coaches during the 13th plan period. Presently, the in-house coach factories of Indian Railways produce 3,300 coaches annually.

Apart from this, 600 coaches are made by the BEML taking the coach production to 19,500 coaches.

In addition, the upcoming factory at Rae Barreilly (1,000 coaches) and sanctioned units at Kancharapara (500 coaches), Haldia (400 coaches) and Palghat (400 coaches), likely to be completed during the 12th Plan period would yield additional 2,300 coaches annually.

The proposed facility in Kolar would manufacture 1,000 coaches annually once the Phase-II is also implemented. Therefore, during the13th plan period, actual installed capacity would become 36,000 (19,500 existing + 11,500 in the pipeline + 5,000 from Kolar unit).

This would almost match with the assessed requirement of 37,000 coaches during the 13th Plan period, the Railways said in a note.