TMH contract signing to supply 120 electric trains to India is delayed, negotiations underway - TMH CEO

SOCHI. June 8 (Interfax) - The contract signing by JSC Transmashholding (TMH) on supplying 120 electric trains to India has been delayed, TMH CEO Kirill Lipa told reporters on the sidelines of the Eurasian Congress.

"No," Lipa said when asked whether a deal had been signed with India.

"It [the contract] has its own complications in the signing process, and we are also negotiating," Lipa said regarding the timing of the signing. "The production horizon [under the contract] is two years, so there is time," Lipa noted.

Lipa previously reported that the contract was planned to be signed in May, and TMH will open a subsidiary in India for this.

"Everything will be built in India, because the country has a make-in-India act that requires reinforced concrete localization," Lipa explained.

"The contract should be about $1.8 billion for supplying the trains and $2.5 billion for maintenance for 35 years. Taking into account indexation, the total contract value could potentially be $6.5 billion," TMH explained to journalists in April.

The Vedomosti publication previously reported that Indian Railways had sent an official notification to the Russia-India consortium about winning the tender to supply 120 passenger electric trains (1,920 railway cars) to India, totaling $1.7 billion. The members of the consortium are TMH's Metrovagonmash and Locomotive Electronic Systems entities with stakes of 70% and 5%, respectively, and Rail Vikas Nigam Limited, an Indian Railways subsidiary, owns the remaining 25%. Rolling stock maintenance is planned for 35 years.

The first prototype of the Indian Railways electric train should be received within two years after the conclusion of the agreement, after which deliveries will begin in stages. The maximum duration of the contract is 82 months.