PGCIL eyes lion’s share of Rs 25k-cr rail electrification project

State-run Power Grid Corp (PGCIL) is eyeing a big chunk of Indian Railways’ Rs 25,000-crore project to electrify 24,000 kms of rail tracks in five years.

“Power Grid will try to get as much share as possible of the 24,000 km rail electrification project. This is a big business opportunity for us,” a source said.

Earlier this month, Indian Railways engaged three PSUs -- Power Grid, IRCON and RITES -- to fast track the pace of rail track electrification project.

Indian Railways has already allotted the electrification work of 761 kms of railway lines at a cost of Rs 888.96 crore to Power Grid Corp (PGCIL).

The source said, “Though it has not been decided whether there would be competitive bidding for this ‘Mission Electrification’ but Indian Railways wants to complete the task at an investment of not more than Rs 20,000. Thus Power Grid is preparing itself to prove its prowess through implementation of the task allocated to it and offering competitive rates.” 

At present, Indian Railways is spending around Rs 1 crore to electrify 1 km of rail track. Besides implementation of the task at hand, Power Grid would have to be cost competitive so that Indian Railways brings down cost of electrification by at least 20 per cent, an expert said.

Indian Railways has planned to electrify 4,000 kms of rail tracks in 2017-18 and 6,000 kms in subsequent years so as to electrify 90 per cent of broad gauge network railways by 2020-21.

The electrification project will help the government cut down on crude imports and also ensure faster movement of trains on these tracks. At present, around 35,000 kms of rail tracks are unelectrified. The electrification of tracks is expected to help the railways save around Rs 10,000 crore annually. Indian Railways consumes around 2.8 billion litres of diesel annually -- costing around Rs 18,000 crore, a nearly 18 per cent of its working expenses.