22 Aug 2020: After Chinese-firm expressed interest, tender for Vande Bharat trains canceled
Indian Railways on Friday announced it was canceling the tender for 44 Vande Bharat trains after a Chinese joint venture firm placed its bids, said reports.
The tender was floated last month and Railways announced a fresh one would be released in a week.
Out of the six contenders, the Chinese joint venture firm was the only foreign one to have expressed interest.
Firm: The joint venture was formed between Gurugram, China based companies
The firm whose bids got the tender scrapped is CRRC Pioneer Electric (India) Private Limited, a joint venture between China-based CRRC Yongji Electric Company and Pioneer Fil-med Private Limited, that is based in Gurugram, in 2015.
Though the national transporter didn't confirm that the decision was driven by joint venture's presence, it mentioned that in the new tender "Make In India" would get preference.
Looking back: Reportedly, CAIT wanted Railways to not entertain Chinese firms
On July 10, when Railways' Integral Coach Factory opened the tender, five other companies — namely Bharat Heavy Electricals Ltd., Bharat Industries, Electrowaves Electronics Pvt. Ltd., Medha Servo Drives Pvt. Ltd., and Powernetics Equipment India Pvt. Ltd. — participated.
This new development comes after the Confederation of All India Traders (CAIT) wrote to Railways Minister Piyush Goyal, urging him to act against Chinese firms.
Tender: Weeks ago, another tender was canceled for similar reasons
Just last month, Railways had also scrapped another tender for thermal cameras, to be used for "COVID-19 surveillance," after Indian firms claimed that a Chinese company was getting preference.
"EOI for selection of partner for thermal temperature screening solution to RCIL's customers stands canceled with immediate effect. Fresh EOI will be published soon," the earlier notice read.
Fact: Tender for manufacturing 44 Vande Bharat trains canceled: Railways
Details: Reportedly, Centre is taking steps to support local suppliers
The latest order says local suppliers will get preferential treatment and for the same, the concept of Class-I, II, and non-local suppliers was introduced, reports TOI.
Class-I local suppliers would have an upper hand as their domestic value addition would be 50% or more.
Class-II suppliers will come next as their domestic value addition ranges between 20 and 50%, followed by non-local suppliers.
Trains: PM Modi flagged first train, Shah the second
To recall, the first Vande Bharat train to Varanasi was flagged by Prime Minister Narendra Modi on February 15, 2019.
On October 3, 2019, the second such train, running between New Delhi and Shri Mata Vaishnodevi Katra, was green-lit by Home Minister Amit Shah.
160 coaches were planned to be produced in 2019-20; 240 in 2020-21; and another 240 in 2021-22, ICF said earlier.
Tensions: Notably, Galwan Valley clash forced India to act against China
Tellingly, India has been taking steps to minimize trade relations with China after the stand-off at LAC.
In June, 20 soldiers, including a Commanding Officer, were martyred in Galwan Valley after China's People Liberation Army launched an attack.
China took objection over India's infrastructure push in the area. Since then, several rounds of talks happened to douse tensions, but to no avail.