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Political instability in Bangladesh and other geopolitical issues in Southeast Asia have caused delays in at least three major overseas projects managed by Indian Railway Public Sector Undertakings (PSUs), including RVNL and IRCON International.
Projects in the Maldives and Myanmar have been impacted, and plans for enhancing North East connectivity through Bangladesh, as well as upcoming rail tenders there, have either slowed or been put on hold, according to officials.
The ongoing turmoil in Bangladesh has affected the North East connectivity plans, which rely heavily on routes through Bangladesh. Earlier this year, the Railway Board sanctioned a Final Location Survey (FLS) for about 1,275.50 km of railway routes through Bangladesh, Nepal, and other alternatives toward the North East. This includes approximately 500 km of new lines and 367 km of gauge conversion in Bangladesh, over 200 km of new lines in Nepal, and 212 km in the North East. However, these plans are experiencing delays due to the region’s political instability.
In Bangladesh, RVNL had planned to participate in tenders worth ?2,500 crore, mostly involving line of credit and government grant projects. These tenders are now unlikely to materialize in the short term due to geopolitical reasons, according to Rajesh Prasad, Director (Operations) at RVNL.
In the Maldives, RVNL is facing a revenue loss of nearly ?300 crore from the Uthuru Thila Falhu-Island (UTF) Harbour project, a ?1,544.60 crore initiative appointed by the Union Ministry of External Affairs. Although all sub-contracts were awarded and resources mobilized, the project has slowed considerably due to geopolitical issues. This delay is significant as it was RVNLs first overseas project.
IRCON International has also reported setbacks in its overseas projects in Myanmar and Bangladesh. Ragini Advani, Director (Finance) at IRCON, noted that political instability has led to a decline in international revenue. The company is experiencing delays in funding from the Government of India, which is provided for projects by the Ministry of External Affairs in the form of grants or lines of credit. Advani mentioned that the disbursement of funds has been slow, affecting project timelines.
IRCONs domestic to international order-book ratio stands at approximately 91:9, indicating a strong focus on domestic projects amidst these international challenges. |
