GE said on Tuesday that it has bagged a $2.6 billion contract from the Indian Railways for the supply and maintenance of locomotives. GE said it will invest $200 million to develop and supply Indian Railways with 1,000 diesel locomotives.
The company received a Letter of Award from the Ministry of Railways for a locomotive supply and maintenance contract, worth approximately $2.6 billion over 11 years. The deal advances the ‘Make in India’ initiative and reinforces India’s position as a global manufacturing destination.GE statement
The largest deal in GE’s 100-year history in India, the company will build a diesel locomotive manufacturing facility in Marhowra district in Bihar, as well as maintenance sheds at Bhatinda in Punjab and Gandhidham in Gujarat.
The move is a major boost to the railway’s modernisation efforts and will provide skill development opportunities for local talent.
This infrastructure project is further evidence of India’s position as a growth engine for Asia. It is a major advancement and milestone for India and for GE, and a symbol of our commitment and support of the ‘Make in India’ initiative.Jeff Immelt, GE Chairman and CEO
Last year, the government had allowed 100 per cent foreign direct investment in the railway sector.
GE Transportation Chief Executive Officer Jamie Miller said the project combines the company’s deep infrastructure and manufacturing expertise with India’s growth priorities. GE will sign an agreement to formalise the contract and establish a joint venture with Indian Railways before breaking ground to construct the facility, the statement added.
Meanwhile, France’s Alstom has been picked to supply 800 electric locomotives and will also build a factory in the eastern state of Bihar, railways spokesman Anil Saxena told Reuters on Tuesday. The total value of the contract and the new factory is about 200 billion rupees ($3 billion).
The two companies combined have bagged a deal worth $5.6 billion.
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