"The work on setting up wheel manufacturing plant at Chapra has been included in the Budget," Prasad announced in the Lok Sabha.
Presenting the 2005-06 Railway Budget, he said the plant would be set up to reduce dependence on import of wheels.
To remove mismatch between production capacity and requirement and to avoid long distance transportation of concrete sleepers, he said 12 new concrete sleeper plants would be established across the country.
Out of these five plants at Chak Sikander, Dauram Madhepura, Sitamarhi, Palghat and Harihar would be set up on immediate need basis, he said.
Prasad said that to encourage development infrastructure and industry in Jammu and Kashmir and the north eastern region, Railways have decided to simplify rules relating to establishment of industrial units in these areas for supply of track components.
"Railways have decided to give special dispensation to the existing policy of approving new vendors," he said.