The government on Wednesday revived the process of the country's largest project in public-private partnership — setting up of two locomotive factories in Bihar — which was stuck for almost three years in bureaucratic hurdles.
The bidding process will be started afresh for the electric loco factory in Madhepura and a diesel loco factory in Marhowra in Bihar, announced by former Railway Minister Lalu Prasad in 2007 and both estimated to be with a combined worth of Rs 3346.15 crore, the Cabinet has decided.
Railway Minister Pawan Kumar Bansal had met Finance Minister P Chidambaram and Deputy Chairman Planning Commission Montek Singh Ahluwalia on April 22 to weed out the contentious points and get the matter cleared by the Cabinet this week. Railways has given itself a time-frame of three months to call for the final bids. The Prime Minister's Office had been keeping a close watch on the progress on this project.
The group of ministers took a call on 13 points, including the contentious issues of assured off-take by Railways, maintenance contracts of the facilities and transfer of assets, to finally get the project off the hook. "The bidders will be aware of the government's stand on all the issues before participating in the process so that there is no unpleasant surprise," said a senior officer.
In the past, a five-member committee of executive officers at the Railway Board had concluded that with the existing terms of the PPP model finalised for the two factories, the government stood to lose Rs 16,000.
