GE's Controversial Deal with Indian Railways

Total value of GE's deal with Indian Railways

$2.5 billion

Number of diesel locomotives GE was contracted to deliver

1,000

Significant political change affecting GE's contract in India

A new railway minister announced a shift to electric locomotives

Indian Railways Minister responsible for reconsidering the GE deal

Piyush Goyal

Location of GE's locomotive factory in India

Marhaura

Major issue cited for moving away from diesel locomotives

Environmental concerns and electrification of railways

Investment by GE in building the local factory in India

$200 million

GE's response to the Indian government's move toward electric locomotives

GE officials tried to negotiate and keep the deal

Percentage of Indian locomotives the Railway Ministry aimed to electrify in 4-5 years

95%

Alternative energy source proposed for electrified rail network

Solar panels along the railway tracks

Major challenge India faced in switching to full electrification

Insufficient infrastructure and power supply

Reason GE locomotive deal was seen as a model for future investments

It boosted employment and economic development in rural areas

Impact of the controversy on GE at the time

GE's stock value declined

GE's concern about India's move to full electrification

The transition would be too expensive and impractical

Lesson illustrated by GE's experience in India about international business

The risks of large-scale foreign investments in politically shifting environments