New Delhi: In a report released on Wednesday, industry body FICCI has said that it expects the Railways to offer manufacturing opportunity of Rs 28,000 crore per annum to the Indian Capital Goods industry. FICCI Capital Goods Committee report on ‘Opportunities for Capital Goods Industry with Indian Railways and Metros’ highlights various opportunities for capital goods sector under ambitious construction projects such as high-speed rail and dedicated freight corridors.
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Opportunities offered by Railways will create 70,000 jobs
Fully capturing these opportunities will generate around 70,000 direct manufacturing jobs and a total of around 7 lakh indirect and induced jobs, FICCI said in the report. On project execution side, the FICCI report said that successfully achieving targets on track construction, electrification, high-speed rail, and dedicated freight corridors will generate a total project execution opportunity of about Rs 5 lakh crore for the industry over the next 5-7 years.
“This will generate 60 to 70 lakh man years of employment during the construction phase of these projects,” noted the FICCI report.
‘Indian Railways is lifeline of India’
Shailendra Roy, Chair of FICCI Capital Goods Committee, said, “Indian Railways is the lifeline of India’s social and economic structure. Industry participation is a must for next generation of upgrades and expansion in Railways infrastructure and network. Policymakers should promote this through both strategic initiatives such as phased manufacturing programs, and policy and process reforms such as making procurement contracts compatible with global standards.”
What does the report recommend?
The recommendations made by FICCI include formulation of national railway plan, reforms in procurement policy and processes, strategic initiatives such as phased manufacturing programme, expansion of PPP model to newer areas, and closer collaboration with industry for absorption of technology.
The report also listed imperatives for the industry which includes de-risking business from over-reliance on Railways orders, forging partnerships with global technology players, promoting self-certification, and ramping up of manufacturing and project execution capabilities.
FICCI also noted that the Indian Railways has substantially stepped up capital expenditure from historical levels of Rs 40,000-50,000 crore per annum. Railways’ capital expenditure for 2019-20 was Rs 1.3 lakh crore, while budget for 2019-20 standing at Rs 1.59 lakh crore, as it undertakes high priority initiatives such as electrification, rolling-stock upgrade, track expansion, the industry body said.