Hello and welcome to The Core Report special edition. I am joined today by Rahul Mithal, Chairman and Managing Director of RITES. Let's find out more about the company, what it does, and why some of the things RITES is focusing on right now, including detailed project reports, are so critical at this time.

Thank you so much for joining me. I am going to come to DPRs, or Detailed Project Reports, in a while, because that is really the foundation of everything you do. But before that, tell us about what RITES does and how it was set up, for those who don't know.

Good morning. RITES is a 52-year-young company. It has a unique position in the infrastructure consultancy market: we are the only company in India, whether in the PSU space or the private infrastructure consultancy space, that has all areas of infrastructure under one roof, whether it is railways, ports, airports, highways, buildings, etc. We have 13 different verticals, and we do three kinds of work primarily. One is the DPR, the techno-economic feasibility report.

The second is project supervision, when the project is actually happening. The third is third-party technical audits. This 3-by-13 matrix makes us well equipped. We are executing about 700-plus orders today, in the country and beyond. We can proudly say that we are a one-order-a-day company, with a fresh order inflow of one order a day. About 70–75% of these are on a competitive basis, both domestic and global.

When RITES was set up, it was obviously a subset of the Indian Railways, and you are also a railway man, so to speak. Tell us about the breakup of orders today, both existing and current, between railway or railway-linked orders and non-railway orders.

Yes. When RITES was incorporated in 1974, it was, and still is, a company with majority holding by the Ministry of Railways, so traditionally rail infrastructure consultancy was our core sector.

But very soon, right in the first decade, the founders had the vision and foresight to make RITES a core consultancy company across all sectors. We started working with the Delhi Metro, and we were the initial consultants for it.

The Mumbai-Pune Expressway was one of the first highways, and RITES was the consultant for that. Within the first year itself, we started doing international projects. As I said, the railway sector accounts for about 30–35–40% of my total top line and bottom line. But sectors like buildings, ports, airports and highways are also very important verticals for us, and they contribute to both revenue and bottom line.

How have things been shaping up in the last couple of years, given the geopolitical shifts we are seeing, particularly when it comes to global orders? I know you have been talking about consistency in orders from the Middle East despite all the trouble there.

And how has it been evolving in India, which of course has been seeing huge capital expenditure as a country?

About two to two and a half years back, we were at about 0.6 orders a day. Gradually, market competition became much higher, and the era of giving PSUs work on a nomination basis was receding. Our business re-engineering and our experience of 50-plus years made us very well equipped, and that is why we stepped up from 0.6 to about one order a day.

We are now steadily maintaining that strike rate. In some geographies there are ups and downs once in a while, but we still continue to get orders, both domestically and internationally. In fact, we have pushed our international business arm, which covers both design and export of rolling stock as well as project consultancy.

In the last year we have opened five regional offices across various geographies of the world: Latin America, West Asia, two regions in the African continent, and one in Southeast Asia, in Manila. That is the kind of push we have given to our international business.

If I were to ask you about this financial year, starting April 2026 as a start point, or even calendar year 2026, what would be the three or four most interesting projects that RITES has secured, whether in India or globally?

Let me tell you about two or three key projects across my verticals. In the rail infrastructure vertical, we are doing the feasibility study for a new high-speed corridor, the Chennai–Bangalore–Hyderabad high-speed corridor. That is very exciting. We had been associated with the earlier high-speed corridor, Mumbai–Ahmedabad. We are also doing a lot of work in the metro sector. While we were doing the Ahmedabad Metro and the Bangalore Metro, we most recently got the order for the Patna Metro.

We are also doing feasibility studies for metros across various geographies, for new metro corridors that are getting announced. There is also the push for educational institutions like the IITs and IIMs, and we are proudly associated with premier institutions. We are doing the expansion of IIT Delhi, IIM Bangalore, IIM Raipur and IIT Bhilai. That is the kind of work we are doing in the building sector.

In highways, we are working with NHIDCL in the Northeast. So every day, across our verticals, we get interesting orders, and of course international orders too. Most recently, we got the DPR for an MMLP in the Gelephu corridor, the Bhutan Gelephu corridor.

One of the things you have been talking about, and I'll come back to RITES's portfolio of projects, is the detailed project report, and I know this is close to your heart. Your argument is essentially that if we do better-quality techno-economic feasibility studies ahead of a project, we will save a lot of headaches afterwards. Walk us through why this is important, and why it is important right now.

I think we are at a very important juncture, a strategic shift from "build and then fix" to "fix the plan and then build." We have been seeing huge growth in infrastructure across verticals, and with this experience, and with RITES's experience of five decades, we are now realising more and more the importance of the planning stage.

Rather than repair a crack, build a proper foundation. That is the key message. We did a study of about 50 megaprojects, and 45 of them had a time and cost overrun.

One of the major reasons is the initial planning, the DPR. It could be a change in alignment, a change in design, some kind of clearance, some environmental clearance, time and cost variation, disputes, land acquisition, and so on. Interestingly, the cost of a DPR today is even less than 0.5% to below 1% of the cost of a project, which is peanuts.

So if you spend a little more time and cost at the DPR stage and realise that this is the key document, the key foundation for an effective, efficient, cost-saving and time-saving project, that is a very important aspect we are working on.

You have been doing DPRs for a long time. Are you saying the DPRs you were doing earlier were not up to scratch, or that you were not getting enough time to…

Traditionally, there is always a tendency to prepare a DPR in a compressed mode. There are two or three challenges in making a DPR. One is that it is always a stop-and-start approach: you want a DPR quickly so that the project can be sanctioned and execution can start. Second, the cost is minimal, so you are always squeezing on cost. Third, 99% of DPR orders are fixed time and cost. When you are given an order for a DPR, you start on some premise, and then you do detailed surveys, the geotechnical surveys, the alignment surveys, the physical surveys, and you end up realising that maybe you need to do some more surveys rather than just rely on secondary data. But there is no time and cost variation at the DPR stage.

It exists at the execution stage, but not at the DPR stage. So you end up wanting to compress everything, meet the deadline and close the DPR, knowing that it is not 100%, or not even 95%, up to the mark. That is why we need to accept that a few months' delay, or a variation of 0.2–0.3% in cost at the DPR stage, brings a huge saving at the execution stage.

Right. I'll come to the impact of climate and other changes, but between the techno and the economic, where do you feel we are losing out more, or have lost out more, in our DPRs?

To my mind, definitely both. On the technical side, it is about having more detailed surveys, definitely more detailed geotechnical surveys, to get a more realistic time and cost assessment of execution and a better estimate of the project's capex. On the economic front too, because the two are interlinked. When you do a better technical job, you get a better economic estimate, and then you can better estimate funding requirements and the phasing of the capex. Let me tell you what we are trying to do, building on our legacy of 50-plus years. This is where tech and AI come in. A very young officer of ours gave us this idea.

He said, "I went to my doctor recently, and doctors in high-tech hospitals are now using AI to scan past patient records and give a template that allows personalised attention to a particular patient, using past patient data to come up with various variations." And we said, we have more than 5,000 DPRs across various verticals. So we are developing an AI tool called Parak, which we are going to roll out very soon, in the next few months. It works on our past historical DPRs and rates them on a scale of 1 to 10.

Then any fresh DPR made by our team gets an initial score, and you iterate on the DPR. When you finally give the DPR to the client, you say, "I am giving you a DPR with a score of so-and-so on a scale of 10." That is using tech, and our past experience and legacy, to improve the quality of DPRs.

You touched upon this, but when DPRs are not strong enough or, as you said, not enough time and resources have been invested, what is the most common outcome we have seen across infrastructure projects in India?

First of all, it straight away results in litigation between the executing agency and the client, and that is a cost for the executing agency. Most executing agencies have a claims department working fully from the initial stage, trying to find out, if there is a time and cost variation, how…

Is this typically a highway project?

A highway project, a building project, any metro project or railway project. One is the litigation cost. The other is locked-up capital. When the actual rollout of the project gets delayed from its envisaged time, there is a locked-up benefit for both the client and the users. So both the executing agency and the client are affected.

For example, the National Infrastructure Pipeline is about ₹100 lakh crore. Even a 10% saving, just imagine the quantum. That is the kind of impact a good-quality foundation, a good-quality DPR, can have on a project.

Many highway projects, for instance, in recent years have seen problems of some sort or other quite quickly, and bridges as well. Are you saying one cause is the quality of planning that went into them, and the other is the materials? Where could we put in more effort to ensure that this reduces in future? Is it materials plus planning?

It is primarily the design, the planning for the design. Once you have a more detailed design, based on more detailed, intensive surveys at the ground level, which takes into account the various clearances required in detail, the bulk of it does not come as a surprise at the execution stage. That is the key point. A good DPR-making entity should know that a DPR is not just a good-to-start document. Mark my words, it is not just a good-to-start document. It is a document that is there for good-to-complete, and that is the difference. So, coming back to the key point, the shift is from "build and fix" to "fix the plan and then build." It is primarily about envisaging the design aspect and the clearances aspect, which in turn is linked to the funding and the skills required to execute the project.

Let's move on. One of the interesting projects I read that you are working on is refurbishing locomotives and exporting them. As I understand, we have about 10,000 electric locomotives and about 5,000 diesel locomotives, and we are now largely electrified as a country. Tell us about the opportunities there.

We have a very dynamic design and export of rolling stock vertical. Now that we are 100% electrified, and we started this innovation about a year and a half back, our team in the rolling stock design vertical found that there are at least 500-plus diesel locomotives that have a balance codal life of about 15 to 20 years. There is a market in Africa, about 11 countries, that has Cape gauge, which is about 1,067 mm, as against Indian broad gauge at 1,676 mm.

We were already exporting new Cape gauge locomotives. So we said, we already have the design and have been exporting new diesel locomotives, so why don't we try to convert an existing broad gauge locomotive into a Cape gauge locomotive? We started working on this. It was obviously a win-win for everybody: Indian Railways could sell its locomotives, and the client could get a locomotive at about two-thirds of the cost. After this effort of about one and a half years, the first two locomotives are now ready and should be shipped out in a month or two. After they go, they will have trial runs in Africa; as I said, there are 11 countries there.

These are the first two prototypes, and it opens up a huge market. Not stopping at that, in parallel we also worked on converting a broad gauge locomotive to standard gauge, which is also very popular. We have received an order for a standard gauge locomotive for Australia, which will also be shipped out in about three months.

These are examples of innovation where you use your legacy knowledge of design to come up with something that is a win-win, as I said, for Indian Railways, for the client and, of course, for us.

For a locomotive to change its gauge, I assume you go back to the railway factory where it was originally manufactured, rip out the entire bottom and recalibrate it. It doesn't sound like an easy task.

Oh, it is interesting, and you put it very well. Yes, it involves the underframe, and when you change the underframe, there is a lot of wiring and cabling. Then there is the relative height of the moving dimensions of the locomotive, and obviously the control system, which must match the new configuration. These are the key aspects, along with the wheelbase and the new design of the bogie. The bogie is the portion of the wheels on which the superstructure rests.

This is the innovation and design we are working on closely with Indian Railways and their production units and maintenance units, where we have come up with both the Cape gauge modification and the standard gauge modification. As I said, in the next few months both will be shipped out, and this opens up huge potential for new orders.

Do your engineers actually go in and work on it, or do the railways, or let's say the coach factory that is actually manufacturing, do it while you supervise?

We have a lot of people with railway and design backgrounds, so it is a combination of hands-on experience in the railways and rolling stock design. It works in very close coordination. We have teams posted in various railway production units, working very closely with their design wing and in coordination with them at the workshop level. While the product develops, whether in the design office or on the shop floor, they work very closely together. We have people working in each of these units.

And an analogous question: why is it that we have broad gauge while most of the world is on standard gauge?

I think it is primarily for historical reasons. India, Bangladesh and Sri Lanka have the largest networks in broad gauge. Then there are about 11 countries in Africa that have a much smaller gauge, the Cape gauge. Most of the European continent, the Latin American continent, Australia and others have primarily standard gauge.

What about China?

China also has standard gauge. Newer networks are generally in standard gauge. But as for broad gauge, we have always been on broad gauge.

Right. Now, lots of things are going on in railways. Electrification is obviously something we have already achieved, much before it became something that people were focusing on. We are also building a lot of high-speed networks, and extending and expanding city networks, as in Delhi. What other things are going on in the railway ecosystem that are of interest and exciting, at least from your vantage point?

We have this USP that for any infrastructure initiative, whether it is actual construction, envisaging a new corridor, or quality inspection and audit, we can tap into the opportunity. This includes areas like station development and new rolling stock, such as Vande Bharat. We have a very strong quality assurance vertical, so we are closely associated with inspection and with improving quality and safety. It also includes studies of new corridors, as I said, the high-speed corridors and the freight corridor that has been announced. In each of these initiatives, whether it is construction of new corridors, alignment studies, new-technology rolling stock, the related quality assurance, or passenger amenities like station development, we are able to tap in. Let me give you a very specific example. Rails are a very important safety product.

RITES has been inspecting them at the Bhilai Steel Plant and Durgapur for the last five decades. Again, very interestingly, one of our young executives posted there came up with the idea of using AI. We used historical data, a study of five decades of past failure data, and rolled out a very important AI inspection tool called VISTAR, the Visual Inspection System through AI for Rails. It has now been adopted by Indian Railways, so all rail manufacturers have to use this tool for better safety inspection. That is the kind of constant engagement we have with various initiatives.

Is it safety inspection for existing track?

No, no, it is for the rails being made. During the manufacturing process, there is inspection at every stage as the rails are manufactured.

If I may digress a little: we are building, for example, a high-speed rail corridor, and I am talking about the bullet train or its equivalent in India. We also have Vande Bharat tracks. I know that track is being upgraded, but what is happening behind the scenes? I think you referred to one safety aspect. How are we investing as a country in higher-quality or better steel, or what is shifting there?

Even the existing passenger networks are being upgraded to increase their speed potential and make them semi-high-speed networks. It is primarily about enabling more and more tech interface to achieve better maintenance and better predictive maintenance. These initiatives are being taken in parallel with the newer corridors, the new high-speed corridors, and are about improved O&M, better safety and better-quality inspection in the existing networks.

As trains go faster, what else comes under pressure?

Safety is definitely a very important aspect, and as I said, that is why tech is being used as an important element to stay alert to the growing pressures on the network. Then there are the passenger amenities. Both go hand in hand. As you said correctly, as the network grows, the pressures on delivery of the network increase.

I know a lot of work has been happening on the signalling side as well. We have talked about track, engines and locomotives, and I will come back to locomotives in a moment. But there is also a lot of digital integration happening on the signalling side, which obviously improves the efficiency of the whole rail system. Does RITES work there, and if so, in what way?

On initiatives like Kavach, which you have seen, that is not really our forte. Whenever any new network or new initiative comes in, we act primarily as a tech audit or design audit company. That is our primary role in any of these new initiatives.

Tell us about locomotives. You talked about the older locomotives that are now being exported. Where are we in terms of the latest-generation locomotives, including electric, and how will they power the movement of both freight and people?

Indian Railways is developing high-horsepower electric locomotives. Interestingly, RITES has traditionally been exporting diesel locomotives, because that was the market in most neighbouring countries and Africa, along with wagons and coaches. Now we are developing electric locomotives for export as the requirement comes up.

That is another of our targets: in the coming few months, we want to get a first export order for electric locomotives. We are also working on developing the Vande Bharat for export on the standard gauge platform, which is a very important initiative for us. Preliminary discussions and work on developing the design have started, and we are very confident that, somewhere down the line, we should be able to get some orders.

The market has responded very well to the possibility of exporting Vande Bharat, with a lot of client countries and interesting geographies.

And it is really you who gets these orders, right? RITES goes out, gets the orders and then implements them back home. Let me take a step back, and maybe sum up partly what you have already talked about. You have been a railway man for part of your life, and you also worked at Container Corporation.

As a country, we achieved penetration a while ago, and we are now focusing on other things: technological upgradation, track improvement, signalling, higher-speed trains.

What is the broad vision today for the rail system in India, and where will RITES play a role in the next few years?

RITES today is an interesting organisation that leverages its legacy and its spread across verticals. It works in close partnership in the growth of the transport network in India, whether railways, highways or metros, and also on a lot of international projects. One of the key areas where I see us making a contribution is corridors. In the past, you had one port here, a railway network there, or a steel plant here, and you could connect them. Now it is about holistic, multi-modal corridor development.

That is why, in this budget too, besides the passenger high-speed corridor, there is a focus on industrial corridors, and that is a very important role we play, in both domestic and international corridors. Let me give you a very specific example: the India-Middle East corridor, IMEC. It definitely has huge potential. Even while the physical infrastructure gets built on the various stretches of the corridor, the India-UAE leg already had container trade by sea. About a year and a half back, we were given a mandate to work on the first leg, the India-UAE leg of IMEC, and to initiate the virtual trade corridor.

That is the next stage: after the industrial physical infrastructure comes the virtual trade corridor. What is a virtual trade corridor? It is about ease of business for export and import cargo. We have just rolled out phase one of a very interesting initiative called METRI, the Master Application for International Trade for Regulatory Interface. It is a tool for seamless exchange of export and import cargo information, and it has received a good response. It has gone live, with ports like JNPA and Kandla connected to Jebel Ali and Khalifa Port in the UAE, with seamless exchange of marine, customs and other information.

We are now working on phase two, not only on this corridor but also exploring opportunities bilaterally with neighbouring countries and on other corridors. So the point is that we are moving from standalone infrastructure to corridors, and even while the physical construction happens on a corridor, you can start having the virtual trade corridor. With our past experience, we are working very closely on this concept.

I assume part of the outcome is reduced turnaround time, particularly for ships coming into, say, Mumbai or Kandla, as you mentioned. What is that?

There are three stakeholders who gain. This is primarily pre-arrival exchange: before the cargo reaches the destination, you collect the export and import information from various portals and stakeholders, collate it, and transmit it seamlessly.

Who gains? First, the importer. At the destination, instead of fishing out information from various sources, compiling it and then submitting it to clear his cargo, he has the information available before the cargo even arrives, so clearance at the port is faster. Second, customs, because it has pre-arrival information about the cargo. It can do better risk assessment and clear cargo faster, and if it wants to do an intensive examination, it can do so.

Third, the port, because with pre-arrival information it can plan better handling and achieve a faster turnaround of the ship. So all three stakeholders gain from the simple concept of pre-arrival exchange of cargo information, collected from different sources at the origin and collated in the manner required at the destination.

Developing the Phase I proof of concept over the last one and a half years involved working very closely with stakeholders on the Indian side, namely customs, exporters, importers, the ports, the Ministry of Shipping and CBIC, and on the UAE side with DP World, AD Ports, and Dubai and Abu Dhabi customs and ports, to bring all these stakeholders to the table and make this POC possible.

So net-net, things will definitely move faster, both inbound and outbound from India, because of this.

Yes.

Let me ask you another question, which comes back to the vision in some ways. One criticism, perhaps from investors who look at India, is that while we have built a great highway network, we have also lost a lot of freight to highways. You are now straddling both worlds, playing both competitors, rail and road. How do we as a country bring more freight back to rail, and what else do we need to do?

This is a very interesting point, and you correctly noted the balance between rail and road cargo. In fact, we recently did a study for NITI Aayog on increasing the shift of containerised cargo to rail.

The key point is that both can coexist. It is about the catchment area, the lead distance and the kind of cargo, as well as passengers. What is the road targeting, and what is the rail targeting?

The potential for both cargo and passengers is so huge that both can work in parallel and both can grow. They are not competing; they are complementary to each other. As long as these two networks complement each other, there is a win-win for both.

As a supplement to that, one of the questions raised, and it is a poser rather than a question, is that we have invested in a fairly wide airport network and added lots of new airports. It is not either-or, but how do we bring people back to rail, as countries or continents like Europe have done?

Or maybe they have not brought people back, but they have ensured that people continue to use rail and that it continues to modernise and upgrade. It is not that fewer aircraft fly there or there are fewer airports; the modes complement each other beautifully. As a vision, how do we move faster towards that, or what else do we need to do to ensure a more balanced transport world?

The Vande Bharat trains that have come up are a huge step in that direction. On intercity travel, there is always a big incentive or attraction if I can go from city to city much more easily on a fast, good intercity train and come back in the evening. Catching a flight has its own issues. As I said, the Vande Bharat initiative is now expanding across intercity routes, especially with the high-speed division, and there are overnight trains too, since a lot of people still like overnight intercity movement.

Meanwhile, there is the growth in airports, and we are working on a large number of UDAN scheme airport DPRs across states. When we give our techno-economic feasibility reports, we take into account whether it is a metro, a highway DPR, an airport DPR or a railway network. That is why we are best placed: we are able to pitch and understand that each of these modes of transport can complement the others because each has a specific need and requirement.

And I'm sure you also suggest that they should talk to each other, or link to each other.

Yes.

It's not always the case in many places.

That is in fact why the client comes to a multi-sectoral-experience consultancy organisation. If I were only a highway consultant or only a railway consultant, I would give my view only on a highway network or a railway network, or on an airport if I were an airport consultant. Because I am a transport consultant, a mobility consultant, a multi-sectoral infrastructure consultant, when you look at your end goal as a client, you are not looking just to develop an airport or a highway; you are looking for better mobility and better transport infrastructure. Whether it is a port or port connectivity, it is multi-sectoral transport infrastructure development that you come to me for. That is why our experience across these various verticals gives you a bigger, broader, better picture in which, as you said, the modes can speak to each other.

That's a good note to end on. Thank you so much for joining me.

Thank you so much.