RITES targets African markets with in-service diesel loco export push
“It is 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 to procure such locomotives, as they are also cost-effective for them,” Rahul Mithal, chairman and managing director, told Business Standard in an interview.
Currently, the company has around 30 diesel locomotive orders on the Cape Gauge, a track-width system used predominantly in African nations. The consultancy has rejigged two such locomotives so far, and these will be put in service after trials.
“Once they are successfully run there, we will start executing the balance of the 30. There are around 11–12 countries which operate on Cape Gauge,” Mithal added.
Indian Railways has a large number of diesel locomotives, and RITES has already created a portfolio of these locos by age profiles. The company sees a lucrative business opportunity here too, as most export orders provide a double-digit margin for the consultancy.
According to the latest data, electrification of the national transporter is over 99 per cent complete. The national transporter plans to keep some diesel locomotives for strategic purposes, but most of its fleet will be electrified in pursuance of its target to become a net-zero carbon emitter by 2030.
The plan is also a part of a bigger push to increase its international business as India looks to have a higher share in the railway and infrastructure global supply chains.
“We will continue improving our bottom line. We will continue exploring other opportunities including our international business — RITES Videsh. Today, it has the highest order book ever in our history — of about ₹2,150 crore,” said Mithal.
The company is hiring more people and has pushed for a major global expansion project recently.
Mithal said RITES has placed senior executives recently across the globe for five geographies who are setting up offices as business heads — headquartered in Manila for Southeast Asia, in Abu Dhabi for West Asia (Middle East), Guyana for Latin America, Johannesburg for eastern and southern Africa, and Ghana for central and western Africa.
The consultancy is also on course to complete its order of 200 coaches for Bangladesh, where there had been initial troubles on coordination around the peak of the unrest in the country, which delayed initial timelines by 5–6 months.
“Billing should not be a problem since it is funded by the European Investment Bank. Coordination or payments would not be an issue, and deliveries will be timely,” said Mithal.
The company is also working closely with the Integral Coach Factory (ICF) in Chennai on the Vande Bharat export project, which has not seen significant headway despite the announcement of a plan more than two years ago.
For exports, Vande Bharats have to be converted from Indian broad gauge to standard gauge, which is prevalent in the Americas and Europe. “Especially in Latin America, and some countries in Africa have great potential for exports. Now that we have a feel of the interest, the project has found more pace,” said Mithal.
The company will look to pitch for orders soon in global markets.
