Delayed Departure: Vande Bharat Sleeper Project Hits a ₹76 Crore Red Signal.

Delays in the Indian Railways' proposed joint venture with Kinet Railway Systems for the production of Vande Bharat sleeper trains have led to a notional loss of ₹76 crore for Rail Vikas Nigam Ltd (RVNL), the railway PSU overseeing the project. The setbacks have pushed the design timeline to the first half of 2026, with manufacturing now delayed further.

Kinet Railway Solutions, a joint venture between RVNL and Russian rail giant Transmashholding (TMH), was initially tasked with manufacturing 120 trainsets of 16 coaches each, with prototypes expected by 2025. However, in mid-2024, the Railways requested a design revision, reducing the order to 80 trainsets, each with 24 coaches, while maintaining the overall target of 1,920 coaches. Prolonged discussions over design changes, particularly regarding toilet layouts and pantry cars, stalled approvals, further extending the delay.

RVNL confirmed the financial impact in its investor call, with Chairman and Managing Director Pradeep Gaur stating, “We are showing a ₹76 crore loss under Kinet as manufacturing has not yet begun, despite substantial investments. Once production commences, revenue will reverse this loss.”

Auditors Gandhi Minocha & Co noted RVNL’s share of net profit from Kinet and other JVs, but the delay in approvals has hindered revenue generation. Gaur emphasized that, despite the setbacks, the project remains profitable, citing the cost efficiency of joint production with TMH compared to in-house production by Indian Railways, which costs ₹90 crore per trainset.

Kinet officials stated they are still waiting for formal notification from the Railways regarding the revised design approval. The Indian Railway Ministry has yet to respond to queries about the delays.

Initially, the JV’s production was progressing well, with a fully equipped factory ready for manufacturing. However, the changes in design—from 16-coach to 24-coach trains—and the subsequent reversion to the original plan have delayed the project by eight to nine months. The first prototype, which was initially scheduled for September-October 2025, is now expected to be delivered in early 2026.

News by Rahul Yelligetti.