Steering Growth

Indian Railways’ electrification plans drive demand for cables

The demand for wires and cables depends largely on the capex undertaken by end-user industries and investments made for infrastructure development. One of the key focus areas for the government has been the electrification of railways.

Indian Railways plans to achieve 100 per cent electrification of its broad gauge network by 2021-22, against 47 per cent as of December 1, 2018. Indian Railways’ electrification plans are expected to create huge opportunities for equipment manufacturers, especially those manufacturing cables and conductors. According to government estimates, over Rs 171 billion has been spent on electrification efforts in the past four years. The government has recently also cleared a proposal to spend more than Rs 121 billion for complete electrification over the next four years, covering more than 13,000 km.

A closer look at Indian Railways’ electrification plans, progress and opportunities in the segment…

  Towards 100 per cent electric traction

The Ministry of Railways has plans for 100 per cent electrification of the broad gauge routes. As of December 1, 2018, 31,652 route km (rkm) of Indian Railways had been electrified. Further, electrification work was in progress on 18,523 rkm of broad gauge rail routes.

In September 2018, the Cabinet Committee on Economic Affairs (CCEA) approved a proposal for the electrification of the balance unelectrified broad gauge routes of Indian Railways, comprising 108 sections covering 13,675 rkm (16,540 track km) at a cost of over Rs 121 billion. With 100 per cent electrification, Indian Railways will become the first major railway in the the world to have a 100 per cent electrified broad gauge network of such size. With the electrification of all routes, Indian Railways’ energy bill is expected to reduce by about Rs 130 billion per annum and fossil fuel (diesel) consumption by about 2.8 billion litres. In terms of annual progress, the last fiscal (2017-18) witnessed an all-time high level of electric traction commissioning of 4,087 rkm, surpassing the target of 4,000 rkm set for 2017-18. The ministry plans to increase the pace of electrification to 6,000 rkm per annum in 2018-19.

A key initiative taken by Indian Railways to expedite electrification and achieve the target of 100 per cent electrification is a change in the mode of awarding project work. First, it has adopted the  engineering, procurement, construction mode for electrification award. Second, it plans to award individual tenders as large as 1,500 km. This would not only lower electrification costs due to better economies of scale but also make tenders more appealing to large companies. Another initiative taken by Indian Railways to improve the electrification process is increasing the number of agencies undertaking the electrification work. Historically, rail electrification has been undertaken by the Central Organisation for Railway Electrification, Rail Vikas Nigam Limited and zonal railways. How-ever, three new agencies – Indian Railway Construction Company, Rail India Techno Economic Service and Power Grid Corporation of India Limited – will also be undertaking electrification work.

Conclusion

With rail electrification, not only will the need for power go up for the electrified network but the entire infrastructure would require a facelift. This would open up a massive opportunity for aligning the business interests of system providers such as overhead line equipment providers and component vendors. It would also mean expanding the interregional and intra-regional transmission network and establishing additional substations for transmission utilities in India

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