Private Operators for Ahmedabad-Mumbai Bullet Train on RailMin Radar

New Delhi: In less than a month of the Cabinet approval for the Rs.98,000 crore Mumbai-Ahmedabad bullet train project, the rail ministry seems to have speeded up the pace of consultations on India’s first bullet train corridor. Among the proposals being looked at by the railway board is a suggestion to allow private operators to run the 508-kilometre high-speed line, officials said.

“One of the recommendations of the Panagariya Committee is to invite private firms to operate the project five years after its commissioning,” said a senior rail ministry official who did not wish to be quoted. “The idea is still very far-fetched. The project itself will take seven-eight years for completion,” he added. The Union Cabinet’s approval for the high-speed line was based on the recommendations of a committee headed by NITI Aayog Vice-Chairman Arvind Panagariya.

The empowered committee for innovative collaborations had approved the project favouring Japan over China for the low-cost funding up to 80 per cent of the cost proposed by Japan International Cooperation Agency (JICA) at 0.1 per cent interest rate (50-year repayment) apart from a commitment for technology transfer and local manufacturing for a specified period.

It had suggested Indian Railways can run the corridor for initial five years — after which private operators can come in — and railways could also formulate a policy enabling the private players to participate in the operations of the line, according to a report. Bullet trains are run by state-owned agencies in France and Germany, while the Japanese Shinkansen system of bullet trains was handed over to private companies after two decades of operation. In Taiwan, where the Sinkansen technology is being used since 2007, the rail operator has sought a bailout by the government to turnaround the troubled business.

Officials also said the ministry will incorporate a new special purpose vehicle (SPV) on the lines of the Delhi Metro Rail Corporation (DMRC) next month to implement the project with 50 per cent equity of the rail ministry. Of the rest, the Maharashtra and Gujarat state governments will contribute 25 per cent each. “Also, an empowered committee of secretaries will be set up to address project implementation issues. It will have secretaries of the Department of Economic Affairs and the Department of Industrial Policy and Promotion (DIPP) and the Railway Board chairman as members,” said a senior official.

The bullet train will be run on a standard gauge line covering 12 stations between Bandra Kurla Complex (BKC) in Mumbai and Sabarmati in Gujarat. The stations en route will include Thane, Virar, Boisar, Vapi, Bilimora, Surat, Bharuch, Vadodara, Anand and Ahmedabad. The train will have a maximum design speed of 350 km per hour (kmph) and an average operating speed of 320 kmph.

The bullet trains will comprise 10 cars with 750 seats in the beginning and will be scaled up to 16 car trains with 1,200 seats in future. The railways plans to run 35 trains per day each way to begin with in 2023 which will go up to 105 trains per day each way in 2053. The service will have an estimated ridership of 36,000 per day both ways (13 million per annum) initially. This is estimated to go up to 186,000 per day both ways (68 million per annum) by 2053.

The total journey time of the train will be 2.07 hours and an average tariff of 1.5 times the 1 AC class of the conventional rail network. The total construction cost of the project has been estimated at around Rs 70,915 crore, including land cost. The overall project stands at an estimated Rs 97,636 crore, including price escalation, interest and development charges and import duties.

Officials said the average per km cost of construction of the bullet train corridor works out to Rs 140 crore, while the project will have an internal rate of return (IRR) of four per cent and an economic IRR (that quantifies socio-economic benefits too) of 11.8 per cent. Some of the work packages of the bullet train contract will include either a Japanese company or a Japanese-led JV as prime contractor. Also, some of the identified goods which are manufactured in Japan will be procured from that nation.

ON THE FAST TRACK The rail ministry speeds up pace of consultations on Mumbai-Ahmedabad bullet train project. The Panagariya panel proposed allowing private operators to run the line 5 years after commissioning. The ministry to set up a DMRC-like SPV to implement the Rs 98k Crore, 508-km corridor. An empowered committee of secretaries to be set up to address project implementation issues. The bullet train to run on standard gauge, covering 12 stations between Bandra Kurla Complex in Mumbai and Sabarmati in Gujarat. The train will have a maximum design speed of 350 kmph and an average operating speed of 320 kmph. Initially, 10 cars, with 750 seats in each train, and 35 such trains to run per day, each way; the service will have ridership of 36,000 per day both ways. Per-km cost of construction of Rs 140 cr, internal rate of return of 4% and an economic IRR of 11.8 per cent

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