Obstacles in Manufacturing 120 Vande Bharat Trains as TMH-RVNL Partnership Faces Challenges

The recent sanctions imposed on Russia by several countries, who serve as suppliers for spare parts, have caused complications to $3.63 Billion Vande Bharat Express Project.

Vande Bharat Express
Representational image

NEW DELHI (Metro Rail News): Production of 120 Vande Bharat trains faces obstacles as TMH-RVNL partnership encounters challenges. The Russian transportation company Transmashholding (TMH) and Indian Rail Vikas Nigam Limited (RVNL) formed a joint venture to manufacture Vande Bharat Express train sets worth approximately $3.63 billion (Approx 30,000 crore). However, the recent sanctions imposed on Russia by several countries, who serve as suppliers for spare parts, have caused complications.

Earlier this year, the Indian Railways awarded the JV deal to the TMH-RVNL consortium. In order to ensure smooth progress of the project, which involves manufacturing 120 Vande Bharat train sets at a cost of approximately ₹120 crore each, RVNL has requested majority shareholding from TMH. However, TMH has not agreed to this and has consequently not provided the required bank guarantee of nearly ₹200 crore to initiate the project.

A senior RVNL official stated that many parts need to be imported from manufacturers in Western Europe and America. On May 22, the United States imposed sanctions on Metrovagonmash, a division of TMH responsible for manufacturing rolling stock and spare parts for the Railways.

RVNL holds a significant share in the JV but is striving for a majority stake to instill confidence in international suppliers and bankers. The official explained that these companies are cautious due to the sanctions imposed on Russia as a result of the Ukraine war and prefer dealing with an Indian company. RVNL aims to resolve this matter by obtaining a majority share.

The TMH-RVNL consortium has until June 2025 to prepare the first two prototype Vande Bharat trains for testing and trials. Once the prototypes are approved, the production will continue in a tapered manner, manufacturing 12 to 18 trains each year. The consortium will also provide maintenance services for the trains for 35 years. The Indian Railways has allocated $1.8 billion for the train sets and an additional $2.5 billion for maintenance. Payments will be disbursed gradually after the delivery of train sets to the Railways.

The official expressed confidence in the technical capabilities of the Russians but emphasized the importance of ensuring comfort in dealing with them. They assured that the issue would be resolved within a few days. The Russian Embassy did not respond to requests for comments, and both sides have committed to keeping the negotiations bilateral and confidential.


Daily Updates from Metro & Railway


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.