RITES targets African markets with in-service diesel loco export push | Industry News
“It’s a win-win situation. Many of these diesel locomotives have 15 years or more of codal life left, and there is a lot of interest in Africa in acquiring such locomotives, as they are also profitable for them,” said Rahul Mithal, chairman and managing director. Commercial standard in an interview.
Currently, the company has approximately 30 orders for diesel locomotives on the Cape Gauge, a track width system used primarily in African countries. The consultancy has so far refitted two of these locomotives, and these will be put into service after testing.
“Once they are successfully executed, we will start executing the rest of the 30. There are around 11-12 countries operating in Cape Gauge,” Mithal added.
Indian Railways has a large number of diesel locomotives and RITES has already created an age-wise portfolio of these locomotives. The company also sees this as a lucrative business opportunity, as most export orders generate a double-digit margin for the consultancy.
According to the latest data, the electrification of the national carrier is more than 99 percent complete. The national carrier plans to retain some diesel locomotives for strategic purposes, but most of its fleet will be electrified, in line with its goal of becoming a net zero carbon emitter by 2030.
The plan is also part of a larger effort to increase its international business, as India seeks to have a larger share in global railway and infrastructure supply chains.
“We will continue to improve our results. We will continue to explore other opportunities, including our international business – RITES Videsh. Today, it has the highest order book ever in our history – of around ₹2,150 crore,” Mithal said.
The company is hiring more people and recently pushed for a major global expansion plan.
Mithal said RITES has recently placed senior executives across the world for five geographies setting up offices as business heads – headquartered in Manila for South East Asia, Abu Dhabi for West Asia (Middle East), Guyana for Latin America, Johannesburg for East and Southern Africa and Ghana for Central and West Africa.
The consultancy is also nearing completion of its order for 200 coaches for Bangladesh, where initial coordination issues took place at the height of the country’s unrest, delaying initial deadlines by 5-6 months.
“Invoicing should not be a problem since it is funded by the European Investment Bank. Coordination or payments would not be a problem and deliveries will be on time,” Mithal said.
The company is also working closely with Integral Coach Factory (ICF) in Chennai on the Vande Bharat export project, which has not seen significant progress despite announcing a plan over two years ago.
For exports, Vande Bharats must be converted from Indian broad gauge to standard gauge, which is common in the Americas and Europe. “Especially in Latin America and some countries in Africa, there is great export potential. Now that we are feeling the interest, the project has found more momentum,” Mithal said.
The company will soon look to launch orders in global markets.
