ET Intelligence Group: The Indian Railways ’ plan to electrify its entire network in the next four years could potentially expand the order pipeline of capital-goods makers by Rs 40,000 crore, with the national transporter seeking to shrink its operating costs through lower reliance on fossil fuels.Network electrification would mean incremental growth opportunities for Larsen & Toubro, KEC International Kalpataru Power Transmission and Texmaco Rail Engineering. Other likely beneficiaries of the switch are ABB India, Siemens, and electric locomotive maker BHEL Electrification by the engineering, procurement, and construction (EPC) model will lower costs for the railways, which now pays about Rs 1.5-2 crore per kilometer. In FY18, the Railways may give a contract for 4,000 kilometers. KEC International, an RPG Group company, expects Rs 750-800 crore of revenue from the Railways in FY18. Orders from the transporter now constitute 15% of the total order book for KEC International, compared with 5% a few years ago.Similarly, Kalpataru Power Transmission expects the share of Railways revenue to go up to 15% in the next few years against 3% currently. Texmaco subsidiary Bright Power offers solutions for overhead electrification, and also manufactures electric loco shells.The decision to switch to electric locomotives from diesel could translate into savings of about Rs 6,000-8,000 crore for the national transporter, with the cost per kilometer of running an engine on electric power being just about half of that on fossil fuels. Fuel costs account for about a third of the total operating expense at Indian Railways. The whole network is about 67,000 kilometer, and of this, about 40% of the track is electrified so far. To speed up the project, the Indian Railways plans to bid out large tenders under the EPC model to meet the 2021 deadline.