In­fras­truc­ture

The am­bi­tious bul­let train project is bound to bring im­mea­sur­able ben­e­fits to the In­dian econ­omy that is cur­rently in dol­drums.

India Business Journal - - CONTENTS - G SRINIVASAN

Magic Bul­let: The am­bi­tious bul­let train project is bound to bring im­mea­sur­able ben­e­fits to the In­dian econ­omy that is cur­rently in dol­drums.

As In­dia will com­mem­o­rate its di­a­mond ju­bilee in 2022 to mark its 75 years of in­de­pen­dence, the NDA gov­ern­ment has pulled up the socks to en­sure that a decade-long dream of hav­ing the first bul­let train in In­dia is re­alised. The first step in this di­rec­tion was taken on Septem­ber 14 in Gand­hi­na­gar, Gu­jarat, when vis­it­ing Ja­panese Prime Min­is­ter Shinzo Abe and Prime Min­is­ter Naren­dra Modi laid the foun­da­tion stone for the maiden, 508-km-long, high-speed rail project be­tween Mum­bai, the com­mer­cial cap­i­tal of In­dia, and Ahmed­abad, the iconic city of the coun­try.

Mr Modi suc­cinctly un­der­scored the im­por­tance and sig­nif­i­cance of the rail project, the first of its growth-pro­pel­ling genre, by re­mark­ing that "more pro­duc­tiv­ity with high-speed con­nec­tiv­ity" is what the na­tion would gain from the bul­let train. He rightly stated that the pres­ti­gious bul­let train will be a game-changer, be­sides be­ing 'a sym­bol of New In­dia' that his gov­ern­ment seeks to build by 2022.

Ja­panese won­der

A lit­tle back­ground is in or­der to ren­der the eu­pho­ria gen­er­ated by this project across the coun­try. It is also im­por­tant to high­light the huge chal­lenges be­fore the project and hu­mon­gous op­por­tu­ni­ties ahead once the project is com­mis­sioned.

The Mum­bai-Ahmed­abad High Speed Rail (MAHSR) project has been sanc­tioned for im­ple­men­ta­tion with tech­ni­cal and fi­nan­cial un­der­pin­nings from the gov­ern­ment of Ja­pan. Na­tional High Speed Rail Cor­po­ra­tion (NHRCL) has been in­cor­po­rated as a spe­cial pur­pose ve­hi­cle (SPV) to un­der­take the im­ple­men­ta­tion of this project with a joint fea­si­bil­ity re­port con­tend­ing that the project is tar­geted for com­mis­sion­ing in 2022-2023. With Mr Modi keen on com­mis­sion­ing the project on the 75th year of the coun­try's in­de­pen­dence in 2022, the project dead­line is ad­vanced by a year.

For peo­ple in­ured to hear­ing and wit­ness­ing the won­ders wrought by high-speed trains in the con­ti­nen­tal Euro­pean coun­tries, Ja­pan and China, the im­age of a sim­i­lar mod­ern train criss-cross­ing the coun­try's ma­jor cities is a dream come true. Many an an­a­lyst of global geopo­lit­i­cal trends say that the pic­ture of the platy­puss­nouted, blue-and-white Shinkansen (the name of the Ja­panese bul­let train) speed­ing past a snow-capped Mount Fuji has be­come a part and par­cel of Ja­pan as its pop­u­lar sushi.

Since Oc­to­ber 1964, when the first bul­let train broke the time it took to cover the 582 km be­tween Tokyo and the com­mer­cial hub of Osaka to four hours (now it is down to two hours, 22 min­utes), the Shinkansen has emerged as the iconic im­age of Ja­pan's post-war pin­na­cle to eco­nomic supremacy in the globe. The Ja­panese bul­let train ex­em­pli­fies the ar­chi­pel­ago's en­gi­neer­ing ef­fi­ciency and in­cred­i­ble stan­dards of safety and punc­tu­al­ity. So far, the Ja­panese bul­let trains had car­ried 10 bil­lion pas­sen­gers with­out a sin­gle ac­ci­dent or

ca­su­alty with an av­er­age en­vi­able de­lay of less than one minute!

Manifold gains

It is small won­der that the Mr Modi is fully con­vinced of the worth and wealth it would bring forth to the econ­omy through ef­fi­ciency gains of un­quan­tifi­able amounts. That is why in his foun­da­tion-stone lay­ing cer­e­mony, the prime min­is­ter said that the high-speed cor­ri­dor should be seen in the con­text of over­all eco­nomic de­vel­op­ment. He con­tended that con­sid­er­ing the time it takes to reach the air­port and then take a flight and even­tu­ally reach the des­ti­na­tion in the city, the bul­let train would take half the time for peo­ple to reach their des­ti­na­tions, un­ham­pered by any in­ter­ven­ing and com­mon ob­sta­cles, such as traffic snarls, pol­lu­tion and road rage. This would also spawn a lot of sav­ings by con­sump­tion of fos­sil fu­els.

For Ja­pan, the pres­ti­gious project in In­dia has been hard won as it deems friend­ship with In­dia a strate­gic gain and geopo­lit­i­cal vic­tory of sort when it out­smarted China by of­fer­ing a loan worth $12 bil­lion at 0.1 per cent in­ter­est to be dis­bursed by In­dia over 50 years. This duly takes care of over 80 per cent of the project's es­ti­mated cost. Ja­pan would also sup­ple­ment the fi­nanc­ing with the largesse of tech­ni­cal as­sis­tance and train­ing pack­age.

The bul­let train project in In­dia must per­force have to be viewed from a new per­spec­tive. In­dia's first train way back in 1853 be­tween Mum­bai (then Bom­bay) and Thane cov­ered the 34-km dis­tance in about an hour. More than a cen­tury and sev­eral decades later, the av­er­age speed of the In­dian Rail­way is among the slow­est in the world at 60 km per hour. Even the coun­try's fastest train, the Ga­ti­man, at­tains a top speed of 160 km per hour. But if things swing ac­cord­ing to the author­i­ties' cal­cu­la­tions, the high-speed rail at its acme would op­er­ate at more than twice this celer­ity to win cred­i­bil­ity and con­cur­rence of many an In­dian wish­ing to see a mod­ern na­tion rel­ish­ing panoply of com­forts and con­ve­nience.

For crit­ics bash­ing the bul­let train project as baloney, it needs to be dinned that over and above pulling traffic from air, rail and road, high­speed rail also gen­er­ates new traffic with peo­ple weigh­ing the com­fort­able and con­ve­nient mode of ex­pe­di­tious trav­el­ling as a new ex­pe­ri­ence. In an econ­omy plagued with low and slow in­vest­ment from the pri­vate sec­tor, with the gov­ern­ment do­ing the heavylift­ing of pub­lic in­vest­ment, this is a vi­able way of mak­ing ex­em­plary use of low-cost sur­plus cap­i­tal slosh­ing in abun­dance glob­ally to build mod­ern in­fras­truc­ture in In­dia. Fi­nally, the high-speed rail project is bound to bring im­mea­sur­able ben­e­fits to the In­dian econ­omy if the teething trou­bles and man­age­rial sna­fus get over­come through well-laid ad­vance plans and rig­or­ous ex­e­cut­ing stan­dards. More­over, stick­ing to dead­line mile­stones with metro­nomic pre­ci­sion is of ut­most im­por­tance for the project's suc­cess.

The bul­let train has emerged as the iconic im­age of Ja­pan's post-war pin­na­cle to eco­nomic supremacy in the globe.

Ja­panese Prime Min­is­ter Shinzo Abe and Prime Min­is­ter Naren­dra Modi laid the foun­da­tion stone for the maiden, 508-km-long, high-speed rail project.

For the bul­let train project, Ja­pan is of­fer­ing a loan worth $12 bil­lion at 0.1% in­ter­est to be dis­bursed by In­dia over 50 years.

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