Modi govt tendered 39,000 train wheels to a Chinese company, deal is 1.68% expensive than Ukraine

Indian Railways has tied up with a Chinese company to overcome the wheel crisis. The deal is 1.68 percent higher per wheel than an offer from a Ukrainian firm. Giving information in Parliament on Wednesday, the Modi government at the Center said that the Railways has placed an order for the purchase of 39,000 wheels for LHB coaches from Chinese manufacturer Taiyuan.

Railway Minister Ashwini Vaishnav said that 39,000 wheels are being procured for LHB coaches of trains. The order has been placed on behalf of Indian Railways with M/s TZ(Taizhong), Hong Kong Manufacturer of M/s Taiyuan, China. He informed that earlier Letter of Approval (LOA) for 30,000 wheels for LHB coach was given to M/s KLW of Ukraine.

But due to the current crisis of war between Russia and Ukraine, the supply from the firms of Russia and Ukraine was affected. Vaishnav said that M/s KLW expressed its inability to complete the deal due to the war crisis in Ukraine and invoked the force majeure clause after the supplies were affected. For this reason a formal purchase order could not be issued to the Ukrainian firm.

What is Force Majeure Clause?
Force Majeure clause is kept while in any deal, because if the deal is not completed due to any calamity, then the agreement can be terminated. It is applied only when the work is affected by natural calamities, such as hurricanes, tornadoes and earthquakes, or the force majeure clause is also invoked in the event of serious illness and war.

Giving information about the wheels deal with the Chinese company, the Railway Minister said that the deal was done with the Chinese firm to overcome the crisis of wheels for LHB coaches. The minister said the Chinese firm is registered with the Department for Promotion of Industry and Internal Trade (DPIIT) for wheels, as per the land boundary policy of the Government of India.

Leave a Reply