A consortium of Titagarh Wagons and Ramkrishna Forgings is in the process of identifying a cost-effective location to set up one of Asia's largest train wheel manufacturing plants, an official said on Sunday.
The special purpose vehicle (SPV) -- Ramkrishna Titagarh Rail Wheels Limited -- will set up the facility with state-of-the-art German technology and machinery, he said.
"We will build a two-lakh-wheel per annum capacity plant, which will be the largest train wheel plant in Asia, if not the world, outside China," Titagarh Wagons vice-chairman and managing director Umesh Chowdhary told PTI.
The plant's capital expenditure is estimated to be Rs 1,000 crore, he said.
We have not finalised the location yet, as a study is underway to identify the best cost-effective location. The decision will be taken after consultation with the railways," he said.
The factors that are crucial to finalise the location will be incentives, easy access to source raw material, and cost-effective transport of finished goods, he said.
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The consortium has won the tender concerned with an aggressive bid of Rs 12,226 crore.
The railway authorities have assured it an annual off-take of 80,000 wheels for the next 20 years to support manufacturing in India.
The central government has decided not only to stop importing train wheels as part of the Atmanirbhar Bharat' (self-reliant India) initiative but also to build up a capacity to export.
The proposed factory would be allowed to export forged wheels to Europe and other countries, after supplying its products to the railways, the official said.
"India used to import train wheels worth around Rs 500 crore per annum. Once the plant comes up, we plan to export 30-35 per cent of our annual manufactured wheels in the international market, after meeting domestic demand," Chowdhary said.
"We have three years from signing of the agreement, which will happen any day, to start supplying 80,000 wheels annually to the railways. This is the time for building the plant and testing facilities," the official said.
Once the wheel plant of the consortium starts operating at its full capacity, the annual revenue will be between Rs 1,500-2,000 crore, Chowdhary said.
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