Train from Spain: Government gives nod to Talgo for trial runs of faster trains between Mumbai, Delhi

Source: The Economic Times, Jul 24, 2015

NEW DELHI: The Modi government has given an in-principle nod for Madrid-based locomotive-maker Talgo to undertake trial runs of its lighter and faster trains that could cut travel time between Mumbai and Delhi from 17 hours to 12 hours without overhauling India’s ageing rail tracks.

Talgo Chief executive officer Jose Maria Oriol, who met Prime Minister Narendra Modi on Thursday, told ETthey are hopeful of bringing their trial train to India by October or early November at their own cost and risk to demonstrate its advantages. A formal nod is all that is awaited to start the process for shipping the train from Spain to India. “Most of the technical part has been solved, now it is the practical part of doing it. Up to now, we have an informal approval. What we need is a piece of paper to say: go ahead. I don’t think it would take too long after this set of meetings,” Oriol told ET, stressing that the company would bear the costs to bring the train from Spain with its technicians for the test runs.

The Railways’ management as well as the ‘political authorities’ are enthusiastic about Talgo’s technology and officials have already seen its trains at work in earlier visits to Spain. “Now they want to see it at work in India,” he said. “Of the 60,000 km of railway tracks in India, some would be upgraded, but most would remain as it is. That’s where we can make a difference, by increasing the speed of the train without changing the track infrastructure,” Oriol said about the firm’s passenger trains that can run from 160 kilometres to 220 km an hour and are being used across the world on legacy rail tracks, including several routes in central Asia and the US.

Enthused by Indian Railways’ ambitious plan to invest $125 billion, Talgo is eager to set up a manufacturing hub in India to tap the Indian and Asia-Pacific market using the recently opened window for 100% FDI in the sector. With revenues of around $500 million expected this year, the Madrid Stock Exchange-listed Talgo is excited about the Modi government’s approach to infrastructure as it is focused on delivering outcomes on the ground soon rather than just pursuing expensive aspirations like bullet trains. “I see a willingness to invest and improve. I don’t know how long it will take. Whenever you deal with politicians, whether it is India or Spain or Italy, you have to be patient.

But in this case, knowing that this government is keen to show some improvements in services to the citizens, it is looking to do that in a rather short time period,” Oriol said. Oriol, who had earlier met railway minister Suresh Prabhu, said the firm is separately bidding for a train set contract put out by the Railways and awaiting other contracts. While it is open to forming a joint venture or entering the country on its own for locomotive manufacturing, Talgo already has a commercial office functioning in India for four years to explore opportunities in India and the Asia-Pacific. It has used the time to also identify a potential supply chain of tier-I and tier-II vendors that can help it localise its product swiftly once it sets up shop. “We are pleased to say that we can find most of the components we need at a very attractive cost here. We have also sub-contracted design and development to a lot of Indian engineers here and they are very skillful at a very attractive price,” Oriol added. “We are also looking at opportunities in China, Japan, Malaysia. So having a presence in India will help us tap those markets too, especially with the free trade agreements it has…so we would very much like to establish in India not just for the domestic market but for exports also,” he added.

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