India’s first Bullet Train: History, facts and numbers

Japanese PM Shinzo Abe was on a visit to India and in a joint statement with PM Modi they announced India’s first Bullet train project which will connect India’s two biggest commercial centers Mumbai and Ahmedabad.

As usual there were some nay-sayers who went into over-drive to discredit and question the entire project like they did for PM Modi’s dream projects, Swacch Bharat, Digital India and Jan-Dhan Yojana project. Some went ahead and asked why India needs to invest Rs 98,000 crore on Bullet train project instead of investing in existing rail systems or to empower poor in a different project. Some said that Ahmedabad-Mumbai was chosen for Bullet train project and ignoring other parts of India because PM is from Gujarat and Railway Minister is from Maharashtra. They continued this argument by saying that why should rest of the India fund bullet train for Maharashtra and Gujarat.

But as usual, most of their arguments were not based on sound logic and far away from facts.

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So how did this Bullet Train come to India?

While the then Gujarat CM Modi had first travelled in a Bullet Train way back in 2007, the first mention of any such project in India came via the Railway Budget February 2009. Back then a decision was taken for Pre-feasibility study for running bullet trains between Ahmedabad-Mumbai and Pune, among other routes.

In June 2009, CM Modi pitched for inclusion of running a bullet train between Ahmedabad and Mumbai in the next railway budget. He said “Gujarat is ready to give all assistance for running the bullet train.”

By 2010, the Final Report was examined by all stake holders i.e. State Government of Maharashtra and Gujarat, Central and Western Railways and various Directorates of Ministry of Railways. The UPA Government had identified six corridors for conducting pre-feasibility studies :-

  • Mumbai-Ahmedabad
  • Delhi-Amritsar via Chandigarh
  • Delhi-Patna via Lucknow and Varanasi
  • Hyderabad-Chennai via Vijaywada
  • Howrah Haldia
  • Cheenai-Ernakulam via Bangalore

Out of the above 6 only Mumbai-Ahmedabad passed the feasibility study and rest of them were either rejected or were still in bidding phase for appointment of consultant to prepare a pre-feasibility study report.

But surpisingly, the 2010 budget was silent on this project and CM Modi expressed disappointment that there was no mention about the Mumbai-Ahmedabad Bullet Train. Finally in 2012 the Railway Minister proposed to undertake a survey of new line for high speed rail corridor (HSRC) and trains between Pune-Mumbai-Ahmedabad.

Meanwhile CM Modi travelled to Japan again in 2012 and this time also he travelled in a Bullet train and discussed Ahmedabad-Dholera and Ahmedabad-Mumbai Bullet Train projects in detail with the Japanese PM.

In 2013 UPA Government appointed Japan International Consultants for Transportation Co.Ltd(JIC) to conduct feasibility study and the findings of the same are here

In May 2014 there was a change in Government and PM Modi continued his efforts to get Japan on-board for the proposed bullet train project and he discussed the same with Japanese PM in detail when he visited Japan last year. Now we see him finally sign the much awaited MoU with Japan

Next let us get to the financial part:

From the information that is available as of now, Japan will be giving a very soft loan of  Rs 98,000 79,000 crore loan at just 0.1% Interest rate. India needs to start repaying this loan over 50 years only after 15 years of moratorium that means if the loan period begins from 2017 then the loan has to be repaid from 2032 till 2067.  As compared to this Japan Bank of International Corporation funded about 60% of Delhi Metro Phase 1 at 1.2% with repayment in 30 years and moratorium of 10 years. So its a huge interest cost advantage India has got from Japan.

Indian railways revenue is growing at around 13% annually which will take current annual revenue of Rs 1,57,000 crore to approximately Rs 12,00,000 crore in 2032 and Rs 60,00,000 crores in 2067 as per most conservative estimates. So in nutshell India needs to pay only approx Rs 2000 crores from year 2030. By then even India’s GDP would have grown multi-fold and this amount would indeed look like a paltry sum.

There will be huge ancillary activities done along the routes of the proposed corridors which will push both investment and job opportunities for the local people and will be a boost for Make In India Initiative. Along with this, Japan has committed to transfer some know-how and technology related to this project. This is also a big boon for Indian.

Further, there has been speculation that the fare of this Bullet train will be exorbitant. This is pure bunkum because as per the feasibility study, a Bullet Train ticket should cost only 1.5 times of Tier 1 AC and will be less than comparable air-ticket. This is completely against the propaganda from Delhi CM Kejriwal that it will cost at 75,000 rupees one way.

Buy why not spend this money on renovating existing railway tracks?

It is true that Indian railways are in quite a pitiable condition, but we have to understand one fundamental point here: A huge chunk of the money for the bullet trains is coming from Japan. And Japan is not giving this money for the love of giving money to needy countries, they are giving this only and only because India will buy their bullet-train making technology. To put it another way, this money will not be available to India for any other purpose besides building a bullet train. So the question of using this money elsewhere is foolish to say the least.

And why only Ahmedabad- Mumbai? 

Well, as you can see from above, the reason for Mumbai and Ahmedabad getting the Bullet Train was not because PM and Rail Minister were pampering their home states, because these cities were selected during UPA time itself. There are multiple reasons why it was chosen over other corridors for the India’s first Bullet Train corridor.

1)      Mumbai-Ahmedabad has one of the highest rail traffic in India with currently over 70 trains daily

2)      Highest Business travellers as it links India’s biggest business centers Mumbai and Ahmedabad (in Western India – this was erroneously omitted

3)      This route has big business cities like Anand, Baroda and most importantly Surat which host World’s biggest diamond cutting and polishing center and India’s biggest textile center. This project will biggest boon for this cities

4)      This Ahmedabad-Mumbai Bullet train corridor is part of Delhi-Mumbai Industrial corridor which will boost employment and investment in this entire sector.

6)      As we know that Ahmedabad to Mumbai has flat terrain with entire land at sea level so it will be very easy to construct high speed rail network here as compared to difficult terrain down south or north.

 

All in all, one can see there are huge plusses to India from this Bullet Train project. We have got a very sweet financial deal from the Japanese Government to make this happen. There will be a transfer of technology which will be helpful to India in future. There will be huge ripple effect of such a large project, generating millions of jobs and giving a huge boost to local businesses. Considering all this, we must welcome the bullet train with open arms.

(with inputs from @unsubtledesi)

Dhaval Patel is a Project Management Consultant based out of Mumbai. He holds interest in Bollywood, Entertainment Industry, Politics and Public policy.

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