Railways to enhance vendor base in North India

Vijay C Roy

Tribune News Service

Chandigarh, May 14

To push import substitution, Indian Railways is walking extra mile to reach out to potential vendors, especially MSMEs in the northern region, to boost Railway procurement and cater to the growing demand. The objective is to develop new vendors and enhance product range of existing ones. 

At present, around 200 ancillaries or vendors across the region supply components to the Rail Coach Factory (RCF), Kapurthala, Modern Coach Factory (MCF), Raebareli, Integral Coach Factory (Chennai)and Diesel Modernisation Workshop (DMW), Patiala.  

The vendors in the northern region cater to 75-80% requirement of RCF, 20-25% of MCF and 10% of ICF. Annually, RCF alone procures components worth Rs 1,500 to Rs 1,600 crore from vendors. The vendors supply a range of components such as coach side wall, floor, roof, seats, berths, doors, windows, water tanks and stainless steel to the coach factories.

To enhance the Railways’ vendor base in the region, CII and Northern Railway in association with Rail Coach Factory (RCF), Kapurthala, and Diesel Modernisation Workshop (DMW), Patiala, organised a vendor development meet here today. More such meets will be held in Ludhiana, Jammu, Baddi and Patiala.

“We are going to different cities and organising vendor development meet with an objective to providing an opportunity for new and existing vendors to familiarise with the Railway procurement process and inform them about the digitisation of Railway supply chain,” said TP Singh, GM, Northern Railway.

“Emphasis is being given on indigenisation of imported items so that import dependence could be reduced, which is at present around Rs 1,000 crore per annum,” he said.

AK Pandey, principal executive director, Railway Board, said Railways procures items worth around Rs 1 lakh crore every year and it is not possible without quality vendors on board. 

Singh said to facilitate the MSMEs enter the procurement process, an innovative system of letter of credit to ease working capital for vendors and availability of up to 90% advance payment have been introduced.  Last year, around 6,000 coaches and 750 locomotives were manufactured in India. 

He said the entire process had been computerised, starting from vendor registration to bill payments. 

Sarvjeet Singh Virk, chairman, CII Chandigarh, said, “Credit and Convenience are crucial 2Cs of vendor development.” 

Ancillary units in North India

Number of units: 200

Located in: Chandigarh, Punjab, Haryana, HP,  J&K

Cater to: Coach factories and locomotives