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.

Maturing of Asian relations

BRP Bhaskar
Gulf Today

A few months before India attained freedom, Jawaharlal Nehru, who was vice-president in the then interim government, called an Asian relations conference in New Delhi. “Asia is finding herself,” he told the conference.

It was a premature attempt at forging meaningful Asian relations. China was still in the throes of the civil war which was to result in a Communist victory. Japan, battered by two atom bombs and shattered by defeat, was slowly picking up the threads. Korea stood divided. Barring the Philippines, which the United States had granted Independence, all the countries which had been under colonial bondage, were still fighting for freedom.

Asian relations took a back seat as Cold War engulfed the continent. Nehru later devoted his energies primarily to promoting the concept of Non-alignment along with like-minded leaders from other continents.

More than six decades later, Asian relations are showing signs of maturing. The countries of the continent, which include several newly emerging economies, are engaged in bilateral and multilateral efforts to rebuild relations on fresh terms. Indian and Japanese efforts to find new political, economic and strategic equations illustrate this point.

Japanese Prime Minister Shinzo Abe was the chief guest at the Republic Day parade in New Delhi last month, and the two countries signed eight agreements during his three-day visit. Emperor Akihito and Empress Michiko were in India on a ceremonial visit a month earlier.

Japan, which is looking for new investment and marketing opportunities, offered $2 billion to expand Delhi’s metro system, which it had funded. Last year it had given $2.32 billion for various infrastructure projects and $753 million for a metro system in Mumbai.

Japan will also provide loans to increase power generation and improve energy efficiency of telecom towers. The New Delhi-Mumbai industrial corridor project and the proposed high-speed rail system too will receive assistance.

India invited Japanese companies to help develop a new port in Chennai and to improve facilities in the tribal border state of Arunachal Pradesh, to which China has staked a claim.

Politically, the most significant outcome of the Abe visit is the decision to have regular official consultations on national security. Japan, which has enjoyed US defence cover since the end of World War II, feels the need to work out new strategic arrangements, but it will be unwise to read too much into this.

The inability to clinch agreements on civilian nuclear cooperation and sale of Japanese amphibious aircraft to India, which have been under discussion for quite some time, underscores the difficulties involved in the building of political and military ties.

Both Japan and India are claimants for permanent seats in an expanded UN Security Council. However, they have not been able to make any concerted move in pursuit of the common goal.

Indian experts are divided on the impact of the Abe visit. Their assessments vary widely from that of “a game changer” or “a new balance of power” to “probing of each other’s strategic intent”. One analyst claimed the ties with Japan is taking the flavor of relations with Russia and the US, with the two sides cooperating on virtually everything under the sun.

The varying assessments are reflective of the differing perspectives of the commentators.

The clearest indication that Asian relations are maturing came from Beijing. Asked about bolstering of Indo-Japanese ties, a Chinese government spokesman merely expressed the hope that it would be conducive to peace, stability and security in the region.

China raised no objection to Japanese participation in Arunachal projects. When India sought a loan from the Asian Development Bank in 2007 for Arunachal projects, China had objected, pointing to its claim to the territory.

China also made no reference to the Indian decision to allow Japanese firms to participate in port development, an area from which its own companies are kept out on security considerations.

Writing in the Global Times, a tabloid run by the ruling Communist Party, Fu Xiaoquiang, an international relation specialist, said Abe’s aim was to pin down China but it didn’t look like he was succeeding.

This is not the first attempt by India and Japan to come closer. In the 1950s, Prime Ministers Nehru and Nobusuke Kishi had explored the possibilities of wider cooperation between the two countries. Indira Gandhi too made an effort in that direction when she visited that country in 1969.

The Cold War, which prevented close relations between the two countries for decades, may be over but they still have to find their way through the debris it has left behind. -- Gulf Today, Sharjah, February 4, 2014.