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400 Vande Bharat trains: Rs 40,000 Cr business opportunity and jobs

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Rolling out 400 Vande Bharat Express trains is about Rs 40,000 crore of business coupled with jobs and other spin-off benefits, said senior officials –present and past — of Indian Railways

Presenting the Union Budget for 2022-23, Indian Finance Minister Nirmala Sitharaman said 400 new energy efficient Vande Bharat trains will be introduced in three years.

The Vande Bharat Express is a semi-high speed train designed, developed and built by the Integral Coach Factory (ICF) at a frugal outlay of Rs 100 crore.

The Indian Railways officials preferring anonymity told IANS that 400 Vande Bharat trains over the next three years is not just headline catching announcement. It is about Rs 40,000 crore business opportunity that would also create 15,000 jobs and several spin -off benefits.

Presently there are only two Vande Bharat trains that are running — Delhi to Varanasi and Delhi to Katra.

“The trains without a pair are running six days a week without a breakdown till date since they were pressed into service a couple of years back. Perhaps Vande Bharat Express is the first train that is run without a pair,” a senior official at ICF told IANS with pride.

It is one classic example of ‘Make in India’ and far cheaper than similar trains that are rolled out by foreign companies.

The train has only about 15 per cent import content which will further go down if production volumes increase, officials told IANS earlier.

An ICF official said the third prototype is getting delayed due to production bottlenecks and logistical challenges due to the Covid-19 pandemic.

However, how the government is going to achieve its target of 400 Vande Bharat Express trains over the next three years is the Rs 40,000 crore question.

While it is really an ambitious target, it can be achieved in a staggered manner with the government giving better clarity on its plans, officials said.

Indian Railway Minister Ashwini Vaishnaw said the upgraded Vande Bharat train is expected to be ready for tests in April and commercial production is expected to start in August/September, 2022.

“I would think that a more realistic target of say 100-150 trains in three years would have been better. This target itself would need very concerted and committed action by railway executives, particularly at ICF,” Sudhanshu Mani, retired General Manager, ICF and the Creator of Vande Bharat Express told IANS.

He said, commercial production and necessary testing of the upgraded train is expected to start only in September 2022 and hence the target should be realistic.

“Rolling out the trains in large numbers may not be an issue. But where are they going to be deployed? The routes also have to be finalised,” Mani added.

Continuing further Mani said ICF should start working on Vande Bharat trainsets, including the sleeper version (code named Train 19) and 300 units of aluminium body trainsets (code named Train 20).

“There can be a foreign partner for rolling out aluminium body trains. In 5/6 year’s time 400 trains can be there,” he remarked.

When pointed out that the train could be rolled out by other coach manufacturing facilities in the country Mani said: “Initially only ICF should roll out as they understand the technology and other aspects. Spreading out the production to other units will result in quality issues.”

Concurring with him, a senior official not wanting to be quoted told IANS: “Only ICF should make it. It needs special skill sets and trained people are not available in other units.”

Officials also said spreading out the manufacturing not only would result in quality issues, but the ultimate death of the train that is successfully running without a hitch six days a week for the past couple of years.

While ICF would initially roll out the trainsets, the other units can take care of the maintenance works and acquire the production knowhow.

The other question is the availability of the vendors. Unless the government gives a clear roadmap, vendors may not ramp up their production capacity, officials said.

“The supply chain will take time to gear up. They can supply only at a steady rate. Out of the 400 trains, during the first year only 20 trains can be rolled out and 380 trains in the remaining two years is not possible,” the official added.

Further vendors and ICF officials are reluctant to touch the Vande Bharat train project after the witch hunt in the form of vigilance enquiry that was conducted and concluded recently without finding any discrepancy.

According to officials, there needs to be long term contracts — say 60 trains for the next 10 years — only then vendors can set up production facilities.

“Tenders and procurement process should be done in such a way that vendors can participate without worry,” they added.

Business

Stock market ends lower as investors take cautious approach on US tariffs

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Mumbai, April 3: The Indian stock market closed lower on Thursday as investors remained cautious following US President Donald Trump’s announcement of new tariffs.

The new tariff structure includes a 10 per cent tax on all US imports, with higher tariffs on countries with a trade surplus. India will now face a 27 per cent tariff.

The Sensex fell 322.08 points, or 0.42 per cent, to close at 76,295.36. During the day, the index fluctuated between an intraday high of 76,493.74 and a low of 75,807.55.

The Nifty also ended lower, down 82.25 points, or 0.35 per cent, at 23,250.10.

“The primary catalyst for today’s decline was deteriorating global sentiment, exacerbated by US President Trump’s announcement of a 26 per cent reciprocal tariff on Indian imports, which prompted a cautious stance among investors,” said Sundar Kewat of Ashika Institutional Equity.

Tech stocks led the losses, with TCS, HCL Tech, Tech Mahindra, Infosys, and Tata Motors declining by up to 4.02 per cent.

On the other hand, Power Grid Corporation, Sun Pharma, Ultratech Cement, NTPC, and Asian Paints were among the top gainers, rising as much as 4.57 per cent.

The IT sector was the worst performer, with the Nifty IT index dropping 4.21 per cent, dragged down by Persistent Systems, Coforge, TCS, and Mphasis. Auto, oil & gas, and realty stocks also struggled.

However, pharma stocks performed well, with the Nifty Pharma index climbing 2.25 per cent. Banking, healthcare, FMCG, and consumer durables stocks also saw gains, rising up to 1.94 per cent.

Despite the overall market decline, smallcap stocks outperformed, as the Nifty Smallcap100 index gained 0.58 per cent.

Market analysts stated that investors are expected to remain watchful of global developments and their impact on market trends.

“The domestic market initially showed signs of recovery but ended with modest losses after the announcement of a relatively lower 26 per cent tariff on US imports,” said Vinod Nair of Geojit Investments Limited.

“Although the tariff presents short-term challenges, India’s economic resilience and bilateral trade agreement may help mitigate the overall impact,” he stated.

The rupee ended flat but traded in a volatile range between 85.75 and 85.35, as markets reacted to Trump’s reciprocal tariff policy.

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India’s GDP growth projected at 6.7 pc for FY26, cyclical recovery expected

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New Delhi, April 3: India’s economy is set to grow at 6.7 per cent in FY26, driven by a cyclical recovery and steady market performance, a new report said on Thursday.

Cyclical recovery refers to the phase in an economic cycle that follows a recession or slowdown, during which economic activity, consumer spending, and business investments start to rise.

Over the past five years, India has witnessed strong earnings growth, with the NIFTY index recording a 20 per cent compound annual growth rate (CAGR), according to a Lighthouse Canton report.

As the economy moves forward, the next phase of growth will depend on key factors such as government capital expenditure, tax benefits for the middle class, and improved consumer demand.

These elements are expected to support earnings recovery and market confidence in 2025, the report said.

India’s investment-led expansion has played a crucial role in economic growth. While the government continues to focus on fiscal discipline, private sector investments are expected to gain momentum, contributing to long-term stability.

The Reserve Bank of India’s recent 25-basis-point rate cut — the first in nearly five years — signals a supportive stance for economic growth.

“India’s economic engine continues to offer long-term promise, however, 2025 will require greater selectivity and discipline,” said Sumegh Bhatia, Managing Director and CEO of Lighthouse Canton in India.

He added that the investors will need to navigate shifting cycles, watch for inflection points in earnings, and remain anchored in fundamentals as the global order undergoes further transformation.

On the global front, market trends and currency movements will influence India’s financial landscape, as per the report.

The strength of the US dollar and rising global trade activity are shaping investment flows, while gold remains a preferred asset due to its resilience amid global uncertainties.

“Additionally, crude oil prices are expected to remain stable, benefiting India’s import-dependent economy,” the report noted.

In 2025, the focus remains on sustainable growth, disciplined market strategies, and long-term investment opportunities, it added.

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Institutional investments in Indian real estate up 31 pc at $1.3 billion in Q1

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New Delhi, April 3: Institutional investments in India’s real estate sector saw a strong start to 2025, with total inflows reaching $1.3 billion in the first quarter, a new report said on Thursday.

This marks a 31 per cent increase compared to the same period last year, driven largely by domestic investors, according to the report by Colliers India.

Domestic investments played a significant role in this growth, contributing $0.8 billion, which is a 75 per cent rise on a year-on-year (YoY) basis.

These investments were mainly directed toward industrial, warehousing and office spaces. The office segment alone attracted $0.4 billion, making up one-third of the total investments.

Hyderabad emerged as a key market in this segment, drawing more than half of the office-related inflows. The residential sector also witnessed a remarkable rise, with investments almost tripling compared to the first quarter of 2024.

The segment attracted $0.3 billion, accounting for 23 per cent of total investments, a figure comparable to the industrial and warehousing sector.

Interestingly, foreign investors led the residential investment surge, contributing over half of the total inflows in this segment.

The industrial and warehousing sector continued its strong performance from 2024, recording over $0.3 billion in investments during the first quarter of 2025.

This represents a 73 per cent increase YoY, supported by rising investor confidence.

Positive macroeconomic indicators, such as India’s manufacturing purchasing manager’s index (PMI) reaching 58.1 in March 2025 — the highest level since mid-2024 — have reinforced optimism in this sector.

The robust demand, higher production, and improved business confidence have all contributed to this growth, the report said.

Mumbai emerged as the top investment destination, accounting for $0.3 billion, or 22 per cent of the total inflows in Q1 2025.

Bengaluru followed with a 20 per cent share, while Hyderabad secured 18 per cent of the investments, according to the report.

In Mumbai, mixed-use assets attracted over half of the total inflows, whereas Bengaluru saw a majority of investments in the residential sector.

City-wise data show a massive 841 per cent rise in investments in Mumbai, compared to Q1 2024, while Delhi-NCR also experienced significant growth with a 145 per cent increase.

The report also found that Bengaluru saw a steady 26 per cent rise in investments during the same period.

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