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19 September, 2017

A Bullet train at high cost

BRP Bhaskar
Gulf Today

The launch of the 508-kilometre high-speed railway project, which will link Ahmedabad, Gujarat’s industrial hub, with Mumbai, India’s financial capital, is sure to boost the prospects of Prime Minister Narendra Modi’s Bharatiya Janata Party in the assembly elections in his home state but there is much scepticism across the country over its intrinsic worth.

Modi and visiting Japanese Prime Minister Shinzo Abe jointly inaugurated work on the mammoth project last week at Sabarmati, the Ahmedabad suburb where Gandhi had set up an ashram on his return from South Africa 102 years ago. Assembly elections are due in the state in December and the Opposition dubbed the event as inauguration of the BJP’s poll campaign.

Many view the proposed railway with Japanese style bullet trains moving at 320 kmph, which will cut travel time between the two cities from eight hours at present to a mere two hours, as a symbol of the New India that Modi is talking about.

Modi made an attempt to make the gullible believe that Abe is giving the Rs 1,100 billion project virtually free. The claim is based on Japan’s grant of a loan of Rs 880 billion, repayable over 50 years with an annual interest of 0.1 per cent, for this project.

Only two per cent of the high-speed line will run on the ground. As much as 92 per cent will be elevated and six per cent in a tunnel. Seven kilometres of the 21-km tunnel will be under the sea.

If the project is completed on schedule, the first bullet train will run in 2023. Modi is urging officials to advance it by a year. The project will be viable only if 40,000 passengers use it daily, paying Rs 3,000 to travel one way.

It remains to be seen how many people will switch from plane or night train to the bullet. In the 1960’s, Vikram Sarabhai, the father of Indian space science, travelled each week from his Ahmedabad base to Delhi on Monday, from Delhi to Mumbai on Wednesday and from Mumbai to Ahmedabad on Friday. The Mumbai-Ahmedabad journey was always by a night train. He said that helped him save daytime for work.

It will, of course, be wrong to draw a general lesson from one person’s experience. However, the proposed fare does appear to be a factor which may limit the bullet train’s appeal.

Japan has had a good deal. A pioneer of bullet train technology with large idle capacity it has been looking for foreign customers for years. The only one it could find so far was Taiwan. The United States did not show interest in its offers. Two years ago Indonesia picked China to execute its $5.5 billion bullet train project.

From India’s point of view, the crucial question is whether the project, as now conceived, is in its best interest.

Critics pooh-pooh Modi’s claim that the project comes virtually free of cost. Japan, they say, has done no favour in providing loan to cover more than 80 per cent of the cost of the project at a low rate of interest. In view of stiff competition with Chinese and European conglomerates, in the past 10 years it has offered loans at near-zero and even negative rates of interest.

They also point out that the interest payable by India may actually work out to three per cent or more as over the 50 years of the loan period the rupee is likely to depreciate against the yen. Besides, the agreement binds India down to use 35 per cent of the money to buy overpriced Japanese technology.

The strongest criticism of the project came from Jawed Usmani, a retired bureaucrat who was involved in the discussions with the Japanese by the Manmohan Singh government 12 years ago. He insinuated that the Japanese had tricked India into buying an expensive toy. The Mumbai-Ahmedabad bulletin train would need to be subsidised forever as the operations would not be economical, he said.

India’s rail system is one of the world’s largest. It runs 12,000 passenger trains which transport 23 million people and 7,000 freight trains which carry 2.65 million tonnes of goods each day. Its finances are in a bad shape, forcing it to look up to government for assistance and to delay investments in maintenance of tracks and rolling stock.

The government has shown poor judgment in giving priority to the high-cost bullet train project over measures to ensure rail safety such as filling posts of maintenance and signalling staff and doing away with unmanned level crossings. Nearly 60 major rail accidents have occurred since 2010 and more than 25,000 were killed while crossing railway lines last year. -gulf Today, Sharjah, September 19, 2017.

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