Railway’s ‘outsourcing’ plan put on hold

Indian railway’s plan to share in-house designs and drawings of passenger coaches with private parties has created a flutter in its two production units – the Kapurthala-based Rail Coach Factory (RCF) and the Integral Coach Factory (ICF) at Chennai. Srinand Jha reports.

Indian railway’s plan to share in-house designs and drawings of passenger coaches with private parties has created a flutter in its two production units – the Kapurthala-based Rail Coach Factory (RCF) and the Integral Coach Factory (ICF) at Chennai.

HT Image

Initiating bulk privatisation of passenger coach manufacture, the railways had permitted different private parties, including the Jessops and the Titagarh Wagons Limited, to manufacture different types of coaches for 26 rakes (trains) in 2012.

The plan has remained on hold because of stiff resistance from labor unions at the two production units.

“There are issues of Intellectual Property Rights (IPR) and also matters relating to passenger safety. The Railway Board directive is flawed and coach design and drawings cannot be parted with in this manner,” a RCF official said.

Designs and drawings have been jointly manufactured by the Lucknow-based Research Design and Standards Organisation (RDSO) and the production units. These are presently valued at R1500 crore.

“It is unusual for the board to provide these free of cost to the private parties,” an official said.

“Outsourcing activities were being pursued with the aim of expanding the supply base for coach manufacture because of the ever increasing demand,” a Railway Board official said.

Questioning the logic, an ICF official said the capacity enhancement of both the RCF and ICF had been envisaged keeping in mind the future requirements.

“What explains the sudden decision to outsource an activity that is intrinsically linked with passenger safety?” he asked.

“The present challenge is to fend off possibilities of an industrial dispute. This is a worrying situation and the board has been informed about this. We have not shared the designs and drawings with the private parties so far,” the RCF official said.