Cabinet gives nod to Electric Loco Factory at Madhepura & Diesel Loco Factory at Marhowra

New Delhi:  The Union Cabinet today gave its approval for setting up of an Electric Locomotive Factory at Madhepura, Bihar and a Diesel Locomotive Factory at Marhowra, Bihar at an estimated cost of Rs.1293.57 crore and Rs.2052.58 crore respectively, with limited equity contribution by the Ministry of Railways.

Over a ten year period, the factories will provide the Indian Railways with 800 electric locomotives of 12,000 horse power (h.p.) each and a mix of 1,000 diesel locomotives of 4,500 and 6,000 h.p. with high level performance guarantees similar to international practices.

The locomotive factories are likely to attract significant foreign investment with concomitant availability of internally generated resources for other important railway projects. Locomotives manufactured by these factories will be of international class energy/fuel efficiency and will become an important instrument of India’s response to global efforts towards mitigation of adverse impacts on climate due to emission of green-house gases. Successful execution of these projects by the JV route will usher Indian Railways into a new era of reforms.

An informal Group of Ministers, chaired by the Minister of Finance and comprising the Minister of Railways and Dy. Chairman Planning Commission had met in April 2013 and finalized its recommendations, following extensive inter-ministerial deliberations. The two factories will be set up in JV mode with locomotive manufactures to be selected through International Competitive Bidding (ICB). The JV partners will be selected through a two stage ICB process. The bids will be finalized within six months of receipt of the Cabinet’s approval.


The goal of sustaining economic growth, modernization and augmentation of locomotive manufacturing capacities and infusion of advanced technology is a basic infrastructural necessity.