Vande Bharat train: From near scrapping in 2017 to Indian Railways' modernization icon

In the next 18 months, a core ICF team under Mani delivered the first rake of ‘Train 18’—called so because of the manufacturing year being 2018—to run at 160 kmph. Later christened Vande Bharat, the trains were tested at speeds of above 180 kmph. Such speeds were unheard of in a country where the average speed of a superfast train is 55-60 kmph while for premium trains, it is 65-70 kmph.

“We wanted to build the country’s first indigenous semi-high-speed train. As I was retiring in December 2018, I told the team that we had 18 months to complete the task from concept to delivery or the project may get dropped… The team delivered,” says Mani, who retired after the first Vande Bharat train was produced. The 16-coach self-propelled locomotive-less train, equipped with modern amenities and enhanced safety features, was built at a cost of Rs 98 crore. If India had imported a set of 10 such train with technology transfer, the cost would have been around `225-250 crore per train. Prime Minister Narendra Modi flagged off the first Vande Bharat train between Delhi and Varanasi in February 2019.

Cut to 2024, and there are 51 Vande Bharat trains (102 services) running across the country. The plan is to have 800 Vande Bharat trains—including new variants—by 2030 (see chart ‘Picking up the Pace’). The government has awarded tenders to manufacture 412 train sets at a total cost of more than Rs 90,000 crore; these trains are to be operationalised in the next three years. India is also eyeing the export market after 2030.

The growing demand for Vande Bharat trains has spurred some players in the space to get into partnerships and expand capacity. From PSUs such as BEML, Bharat Heavy Electricals Ltd (BHEL) and Rail Vikas Nigam Ltd (RVNL) to private players like Titagarh Rail Systems Ltd (TRSL), Alstom, Bombardier and Siemens—all are eyeing sizeable manufacturing orders in the next few years.

The Vande Bharat brand, experts say, could be a Rs 2-lakh crore manufacturing opportunity by 2030. What helps is the fact that Vande Bharat trains will have new variants. While the trains started out as chair cars, trials for a sleeper coach are on. Then there’s the Vande metro that would cover distances under 200 km, while there are also plans of a bullet train version that could touch speeds of 250 kmph—but railway tracks need to be upgraded before that happens; more on that later.

The plan

Today, Vande Bharat has established itself as a brand, and the Indian Railways aims to take it across categories, replacing its existing Rajdhani trains, which have an average speed of 80 kmph. Such trains will have a top speed of 160 kmph, cutting down travel time, and tickets will be priced at a premium of 15-20% over other trains on the same route. According to a senior railway official who declined to be named, Vande Bharat is a premium product and provides a semi-high speed experience to passengers who are ready to pay for the services. “People don’t mind paying extra for a faster service with better amenities and we have seen passengers shift from Shatabdi trains to Vande Bharat on some metro routes,” says the official.

During this year’s Interim Budget, Finance Minister Nirmala Sitharaman had said that 40,000 rail coaches will be converted to Vande Bharat standards to elevate safety, convenience, and comfort, while also providing a boost to private sector railway manufacturers through refurbishment contracts. As of now, the government has rolled out tenders to manufacture about 6,600 Vande Bharat coaches, and a similar addition is expected over the next five years.

Keeping in mind the government’s 2030 target, Amit Anwani, Lead Equity Analyst at brokerage firm Prabhudas Lilladher, says that while tenders to make 412 Vande Bharat trains at a total cost of Rs 92,735 crore have been rolled out, “the remaining opportunity size is worth over Rs 1 lakh crore”.

And it is popular among passengers. The current chair car version of Vande Bharat has recorded more than 95% occupancy on some routes. But travellers have also flagged some issues such as non-reclining seats, which have been mitigated in the second version of the train, say experts.

The third version will consist of air-conditioned sleeper trains that will cater to overnight routes and replace Rajdhani trains; Vande metro train; and Vande Bharat bullet trains. The Railways looks to complete trials of the first Vande Bharat sleeper rakes by August and Bengaluru-based PSU BEML aims to deliver all 10 sleeper train sets by the end of the year.

BEML bagged the first order worth Rs 675 crore for the sleeper version of Vande Bharat from ICF last year. Initially, the plan was that the sleeper rakes would hit the rails in March, but it was delayed due to technical reasons. Recently, Railway Minister Ashwini Vaishnaw said the trials were expected to be completed in August.

Each sleeper rake will consist of 11 AC 3-tier coaches, four AC 2-tier coaches and one AC First Class coach. Besides BEML, other players that have been awarded contracts to make Vande Bharat sleeper trains are a joint venture between RVNL and Russian infra major CJSC Transmashholding, BHEL-TRSL, and Alstom that will manufacture aluminium sleeper coaches (see chart ‘The Order Book’). The Railways plans to connect important cities of the country with about 250 Vande Bharat sleeper trains by 2029.

The equity markets, too, have taken notice. The decent pipeline of railway projects, led by increased demand for rolling stock and other ancillaries, has led to a surge in the share prices of firms in the railway space.

Revving up manufacturing

The growing demand for rolling stock has led to companies in the sector expanding their production capacity. Some have also announced plans to set up ancillary manufacturing units in India. For instance, Kolkata-based TRSL is expanding its rolling stock capacity at its Uttarpara factory in West Bengal to meet the demand for the Vande Bharat sleeper and metro coaches. And France-based Alstom plans to manufacture large traction batteries used in Vande Bharat sleeper and metro trains.

While RVNL-Transmashholding has won an order to manufacture 120 Vande Bharat train sets at Rs 120 crore each, BHEL-TRSL has bagged an order to make 80 Vande Bharat sleeper train sets by 2029 at an estimated cost of around Rs 24,000 crore.

TRSL Deputy MD Prithish Chowdhary says the first prototype of the sleeper train should be ready by May 2025. “We are ramping up our production capacity to 850 passenger coaches annually by FY28,” he tells Business Today.

Besides coaches, private players have also made plans to set up units to manufacture components such as forged wheels, brakes, batteries, and transmission systems. At present, some components used in Vande Bharat trains are imported from countries like China, Russia, Brazil, and a few European nations. Plus there exists a huge gap between the demand and availability of forged wheels, also used in Vande Bharat trains, in India. The Railways estimates the demand for wheels to rise to 200,000 per annum by 2026, from around 120,000 in FY23.

“In 2022-23 alone, we imported around 80,000 wheels worth Rs 520 crore from China and Russia, while the remaining 40,000 were sourced from Steel Authority of India Ltd (SAIL). With the induction of more Vande Bharat and semi-high-speed trains, the demand for forged wheels will further rise, making domestic manufacturing capacity essential,” says Chowdhary.

To address this demand, a consortium of TRSL and Ramkrishna Forgings is setting up the country’s first wheel manufacturing facility in Chennai, where the first set of wheels is set to roll out by May 2026. The total capital expenditure for this project is estimated at Rs 1,800-2,000 crore, which is being funded through a mix of debt and equity.

With India also planning to export Vande Bharat trains to neighbouring nations, Anwani feels it could provide a fillip to railway component manufacturers. He says that with export orders, there will also be vendor-based requirements, as not all factories producing coaches are likely to manufacture components such as electrical traction, forged wheels, and steel bodies. “This is where the opportunity lies for PLI and if you want to look at exports then your vendor base should be strong,” he says.

Speed bumps

Mani says the thinking behind the manufacture of Vande Bharat rakes was to speed up trains in India. While the rakes were tested at speeds above 180 kmph during trials, they were approved to run at a maximum speed of 160 kmph by the Commission of Railway Safety. But the average travel time of Vande Bharat trains has increased in the past three years, primarily due to speed restrictions on certain track sections for work related to repairs and upgradation. In fact, in response to an RTI petition filed by Madhya Pradesh-based activist Chandra Shekhar Gaur, the railway ministry said that the average speed of Vande Bharat trains had come down to 76.25 kmph in 2023-24 from 84.48 kmph in 2020-21.

Mani says upgrading track infrastructure remains a challenge as the current ones can support trains running at a maximum speed of 130 kmph. “We need to upgrade tracks for Vande Bharat trains to run at their maximum speed to cut down travel time for passengers. We need more commitment to execute track upgradation work keeping in mind there is no shortage of funds as budgetary allocation to the Railways was at a record high at Rs 2.6 lakh crore in FY25 from Rs 40,000 crore 10 years ago,” says Mani.

The Railways is likely to invest Rs 7 lakh crore over the next decade to lay 50,000 km of new train tracks to modernise its network and boost the top speed of trains, say experts. For context, the route length of the Indian Railways is around 69,000 km across the country. But laying tracks is expensive. According to estimates by the Railways, laying 1 km of track involves expenditure of around Rs 15 crore and the price fluctuates based on steel prices and land availability.

Already, there has been some delay in the introduction of the sleeper version of Vande Bharat. Scaling up capacity may take time and Anwani feels that the government’s aim to have 800 Vande Bharat trains by 2030 may be difficult to achieve. “I think it will be somewhere between 650-700 Vande Bharat [trains] by 2030,” he says.

For Mani, achieving the target will need more commitment and focus. “Development of a sleeper version to replace Rajdhanis and other premium overnight trains was necessary… [but] we still don’t have them after nearly six years of the [original] prototype,” he says. Mani also questions the efficacy of the Vande metro. “It will be on the lines of intercity MEMU trains. At present their fare is around 30 paise per km, which works out to Rs 40-50 for a distance below 150 km… If you charge Vande Bharat-type fares, what is the kind of occupancy and patronage do you expect?” he asks.

While some questions persist, Vande Bharat has established itself as a popular product with travellers and set the foundation for the modernisation of Indian Railways. Its next task is to establish India as a rail manufacturing hub. Will it succeed? We will have to wait till 2030 to find out. 

@richajourno