Country of broken railway tracks: How will bullet train run?

[MilSpec]

A classic case of putting the bull before the bullock cart

Thats how a cart works boss, you do put the bull before the bullock cart.

 

[my2cents]

So india nuclear program (both weapons and civil), ISRO and everything else India has now were just ego boosts and showing off at taxpayer cost?...given they were all started when things were far far worse in India (absolutely horrid energy program, mismanaged defence sector and terrible phone/information/engineering sectors respectively).

You do realise bullet train pilot project is to develop now (at small scale) what we will need en masse down the road...rather than be behind the curve as usual when we need it? Have a look at the JICA loan arrangement before you make tall fanciful statements sitting in US.

@anant_s need your views on this topic please sir.

Its a question of misplaced priorities. Amount of money that is needed to even bring this project to completion is bind boggling. Is it scalable for entire India? I don't think so at present state of economy. Some of you have mentioned about how we started ISRO and Nuclear program when the economy was bad. But we have to take a hard look at how we got humiliated by Chinese in 1962. How Pakistan took advantage of our weakness by attacking us in 1965. Nuclear program was started to deter China and Pakistan. ISRO was conceived in 1960's with shoe string budget and it still works on shoe string budget when you compare with our size of the economy.

The cost of acquisition of land in India is so expensive. It is the same reason HSR did not take off in America and also the distances involved. Some estimates put the cost of entire project from Ahmedabad to Delhi to be 1 lakh crores. Our entire railway budget for 2016 is 1.25 lakh crores. Just imagine how much we can improve our existing trains and stations with that kind money. We can add lot more trains on same tracks and make railways profitable.




The way I look at it, it will not be profitable until the foreseeable future.

 

[Nilgiri]

Its a question of misplaced priorities.

Uh no its not. JICA loan under such generous terms is not offered for anything else. India would be foolish not to take it. If you have detailed CBA covering the repayment thresholds long term accounting for future Indian market size, lets see it.

Is it scalable for entire India? I don't think so at present state of economy.

And you understand how long term this project is? What is relevance of "present" state to the state 10, 20 and 30 years down the road? How is hedging on all transport modes on (large grace period) loans from high and generous liquidity countries a fundamentally bad idea? Will these loans be offered in the same manner when the demand is more pressing? What is the right balance...have you looked into it...or you are just wildly guessing?

Some of you have mentioned about how we started ISRO and Nuclear program when the economy was bad. But we have to take a hard look at how we got humiliated by Chinese in 1962. How Pakistan took advantage of our weakness by attacking us in 1965. Nuclear program was started to deter China and Pakistan. ISRO was conceived in 1960's with shoe string budget and it still works on shoe string budget when you compare with our size of the economy.

Point is we did not use excuse of "leaky things" and blindly hold back our best and brightest minds from pursuing top tier niche development. How are capital intensive mass transportation networks any different? Everything needs to be hedged and piloted ASAP to stay ahead of the curve. There is no reason why this means resources are automatically diverted from plugging the existing leaks (given the capital is foreign-sourced during the capex injection). The generous loans were never made available for that in the first place, it is rather a new injection on top of assured spending based on administration reform that dominate the latter.

The cost of acquisition of land in India is so expensive. It is the same reason HSR did not take off in America and also the distances involved.

India is much more densely populated than the US and has 1/3rd the land area. Hence the CBA with expanding air travel must be done to get the best balance between the two. That needs a pilot project of HSR somewhere to compare with so might as well make use of a generous loan (rather than focusing our own scarce capital) to develop the early capacity. Acquiring land everywhere is expensive, maybe we should also stop expanding every form of transport....be it airports, highways, ports as well?....because hey land is expensive! Just sit there farming for 100's of years because land is expensive! You understand how a CBA w.r.t capacity development works right? This socialist attitude is why India stayed economically stagnant for majority of its independence.

Some estimates put the cost of entire project from Ahmedabad to Delhi to be 1 lakh crores.

About 10 billion USD....maybe 0.65 lakh crores...spread over many years.

Our entire railway budget for 2016 is 1.25 lakh crores.

You understand that Indian railways will not be allocating from its budget for this right? Not even one penny. You also understand the number of years the JICA loan covers right...i.e project duration and that per year it comes to much lower figure of capex injection?

Just imagine how much we can improve our existing trains and stations with that kind money.

This is NOT a loan that is given to India to do whatever it pleases regarding railways.

So please volunteer to go to JICA and convince them to fund this under super generous terms too. You seriously think they will be interested when the monies for that are already largely guaranteed long term and there is thus high liquidity competition here?

We can add lot more trains on same tracks and make railways profitable.

Hence the whole idea of DFC projects to decongest the overburdened trunk networks so they can be de-ramped in an optimal way to expand their capacity as well. The ramping and leveraging of this is not attractive for any foreign creditor given it needs better administrative reform within India (and that needs few more terms of BJP at minimum since its just started now after decades of neglect). Compare that to a greenfield project that injects new technology and concepts to large scale fast travel in India given where India will be in 10 - 20 years time...its pretty stupid not to hedge at some level...esp with flush liquidity that Japan has and its own "maxed out" economy.

The way I look at it, it will not be profitable until the foreseeable future.

This project is thus a pilot with the future in mind....rather than waiting for the future to happen and be caught having to pay much much more.

 

[EndangeredSpecies]

yes, so.., i didnt get your point?
the point was that though when we talk about poverty and hunger africa pops up but it s more common in india, pakistan and bangladesh

I guess you need to read your message again.

I think i was talking about mars. No i will not spwns millions to send probe to mars if i have people dying of hunger (greater than total people in Africa)

What you wrote means India has more people dying of hunger than TOTAL people there in Africa which is impossible as there are 2.1 billion people in Africa and if that many people in India would have been dying due to hunger there would have been no Indians left in India.

BTW, According to Global Hunger Index, the hunger situation is worse in Pakistan.
https://en.wikipedia.org/wiki/Global_Hunger_Index

Thats how a cart works boss, you do put the bull before the bullock cart.

Thats the Srilankan bogan Kart! Dont even ask!

 

[my2cents]

Uh no its not. JICA loan under such generous terms is not offered for anything else. India would be foolish not to take it. If you have detailed CBA covering the repayment thresholds long term accounting for future Indian market size, lets see it.



And you understand how long term this project is? What is relevance of "present" state to the state 10, 20 and 30 years down the road? How is hedging on all transport modes on (large grace period) loans from high and generous liquidity countries a fundamentally bad idea? Will these loans be offered in the same manner when the demand is more pressing? What is the right balance...have you looked into it...or you are just wildly guessing?



Point is we did not use excuse of "leaky things" and blindly hold back our best and brightest minds from pursuing top tier niche development. How are capital intensive mass transportation networks any different? Everything needs to be hedged and piloted ASAP to stay ahead of the curve. There is no reason why this means resources are automatically diverted from plugging the existing leaks (given the capital is foreign-sourced during the capex injection). The generous loans were never made available for that in the first place, it is rather a new injection on top of assured spending based on administration reform that dominate the latter.



India is much more densely populated than the US and has 1/3rd the land area. Hence the CBA with expanding air travel must be done to get the best balance between the two. That needs a pilot project of HSR somewhere to compare with so might as well make use of a generous loan (rather than focusing our own scarce capital) to develop the early capacity. Acquiring land everywhere is expensive, maybe we should also stop expanding every form of transport....be it airports, highways, ports as well?....because hey land is expensive! Just sit there farming for 100's of years because land is expensive! You understand how a CBA w.r.t capacity development works right? This socialist attitude is why India stayed economically stagnant for majority of its independence.



About 10 billion USD....maybe 0.65 lakh crores...spread over many years.



You understand that Indian railways will not be allocating from its budget for this right? Not even one penny. You also understand the number of years the JICA loan covers right...i.e project duration and that per year it comes to much lower figure of capex injection?



This is NOT a loan that is given to India to do whatever it pleases regarding railways.

So please volunteer to go to JICA and convince them to fund this under super generous terms too. You seriously think they will be interested when the monies for that are already largely guaranteed long term and there is thus high liquidity competition here?



Hence the whole idea of DFC projects to decongest the overburdened trunk networks so they can be de-ramped in an optimal way to expand their capacity as well. The ramping and leveraging of this is not attractive for any foreign creditor given it needs better administrative reform within India (and that needs few more terms of BJP at minimum since its just started now after decades of neglect). Compare that to a greenfield project that injects new technology and concepts to large scale fast travel in India given where India will be in 10 - 20 years time...its pretty stupid not to hedge at some level...esp with flush liquidity that Japan has and its own "maxed out" economy.



This project is thus a pilot with the future in mind....rather than waiting for the future to happen and be caught having to pay much much more.

It is one of kind of loan offer that may work for this project on long term basis, but I am talking about spending from our kitty or taking a loan from world bank whose terms will not be as generous. I am talking about the scalability of this project in other provinces of India if we were to finance it. If we start subsiding the tickets for HSR then this project is doomed for failure because of high costs involved. Do we have enough passengers who could afford the high costs of tickets??

We already have express trains, so why invest in a bullet train?

What is about HSR vs our express trains that will help India is a question that begs answer??

Is it the priority that needs our immediate attention??

How about providing affordable health care, education, housing etc??

 

[Nilgiri]

but I am talking about spending from our kitty or taking a loan from world bank whose terms will not be as generous. I am talking about the scalability of this project in other provinces of India if we were to finance it.

Thats already a projection for the future and introduces many variables.

If we start subsiding the tickets for HSR then this project is doomed for failure because of high costs involved.

Why would that need to be done? AFAIK, whole thing will be PPP model, so there could well be private ownership/operation to some degree. Long term break even cost will be around 40 USD per ticket for mumbai - ahmedabad and delhi-amritsar type distances. If there is organic demand for this time sensitive travel down the road, it competes with short commuter air travel quite well. Over longer distances we will have to see....India's high frequency of cities (given population density) in almost every corner should help....and can evolve to european type network over time.

Do we have enough passengers who could afford the high costs of tickets??

Hence why targetting right area initially is important. With Bombay being what it naturally is (and Pune is nearby too)....and Surat (en route) being a major business/manufacturing city of diamond trade etc and ahmedabad being a expanding commercial city (with GIFT smart city coming up)...it should be a good candidate for it. JICA did CBA and surveys and is confident the investment is sound from what I have heard.

We already have express trains, so why invest in a bullet train?

Because there is only so much speed you can operate on regular existing lines without compromising the schedules of slower trains (which move much more people and freight). Hence you need full segregation for a proper high speed line to help decongest existing lines of that traffic (and improve quality/safety there as well) and provide time sensitive premium for those that demand it (and help compete with airline travel) esp as economy grows further and people want more choice.

What is about HSR vs our express trains that will help India is a question that begs answer??

Repeating the same question is useful?

Is it the priority that needs our immediate attention??

Whole govt will be focused on this project or something? Largely it will be done under PPP model which delegates much to the private sector.

Or everything private sector now also needs to be purely focused on only the poorest of poor people? Lets stop production of all cars, buses, stop operating airlines too...and focus on getting bicycle and scooters to every poor person through the awesome efficient and transparent behemoth that is the government. A very sound economic idea straight out of Nehru playbook.

Since when is anything development related all or nothing in govt focus? We have that much scarcity of talent?

I hope you fundamentally realise why stopping every advanced or high level thing we do so that some how resources magically are transferred on 1:1 basis to helping mr regular tom, dick and harry is fundamentally flawed at any quality of govt? You are living in a country where it is fundamentally rejected by the majority of its people, there is a reason why its the richest and most powerful country in the world still, and by far margin too. Ability to expand the frontier while basic market economics fill in behind is the reason why there is any human progress at all. Artificially stopping to share the cake "better" through arbitrary authority and definitions, only puts a brake on it...for more negatives than positive overall in long term. The evidence is all there to see (extreme case: USSR).

How about providing affordable health care, education, housing etc??

Again you seem to be thinking JICA loan is open to spend anywhere. It is specific to only this (its their money and investment to seek return on). Foreign capital be it FDI or loan based often is targetted to get the high quality amounts (given it can be managed by investor as they want it).

Are we going to say no to FDI from say General Electric, GM or Honda because hey it doesnt govern affordable health care, education, housing etc?

 

[Dem!god]

India doesn't need a bullet train. What it needs is a semi high speed train that runs at an average speed of 125-150km/hr speed with affordable prices. This will solve 95% of traffic problem. Railways run superfast trains at 55km/hr avg speed and they want bullet train. The usual trains are 3-4 hr late on their every trip and they bullet trains and hyperloop.
Pehle ye to theek kar lo re baba..

 

[EndangeredSpecies]

India doesn't need a bullet train. What it needs is a semi high speed train that runs at an average speed of 125-150km/hr speed with affordable prices. This will solve 95% of traffic problem. Railways run superfast trains at 55km/hr avg speed and they want bullet train. The usual trains are 3-4 hr late on their every trip and they bullet trains and hyperloop.
Pehle ye to theek kar lo re baba..

I disagree, the right question is "at What price point". The Japanese offered funds at such a competitive terms that it makes sense to lock down that benefit now. When you are making changes or improving, there are things which can and should happen in a certain order, rest of the things should be decided by opportunity open to you. Japanese provided a good opportunity in terms of favorable funding.

Government can still put money in building more railway tracks. One is not exclusive of other. Japan is surely not providing funds at cheaper interest rate to upgrade our old tracks.

Thats already a projection for the future and introduces many variables.



Why would that need to be done? AFAIK, whole thing will be PPP model, so there could well be private ownership/operation to some degree. Long term break even cost will be around 40 USD per ticket for mumbai - ahmedabad and delhi-amritsar type distances. If there is organic demand for this time sensitive travel down the road, it competes with short commuter air travel quite well. Over longer distances we will have to see....India's high frequency of cities (given population density) in almost every corner should help....and can evolve to european type network over time.



Hence why targetting right area initially is important. With Bombay being what it naturally is (and Pune is nearby too)....and Surat (en route) being a major business/manufacturing city of diamond trade etc and ahmedabad being a expanding commercial city (with GIFT smart city coming up)...it should be a good candidate for it. JICA did CBA and surveys and is confident the investment is sound from what I have heard.



Because there is only so much speed you can operate on regular existing lines without compromising the schedules of slower trains (which move much more people and freight). Hence you need full segregation for a proper high speed line to help decongest existing lines of that traffic (and improve quality/safety there as well) and provide time sensitive premium for those that demand it (and help compete with airline travel) esp as economy grows further and people want more choice.



Repeating the same question is useful?



Whole govt will be focused on this project or something? Largely it will be done under PPP model which delegates much to the private sector.

Or everything private sector now also needs to be purely focused on only the poorest of poor people? Lets stop production of all cars, buses, stop operating airlines too...and focus on getting bicycle and scooters to every poor person through the awesome efficient and transparent behemoth that is the government. A very sound economic idea straight out of Nehru playbook.

Since when is anything development related all or nothing in govt focus? We have that much scarcity of talent?

I hope you fundamentally realise why stopping every advanced or high level thing we do so that some how resources magically are transferred on 1:1 basis to helping mr regular tom, dick and harry is fundamentally flawed at any quality of govt? You are living in a country where it is fundamentally rejected by the majority of its people, there is a reason why its the richest and most powerful country in the world still, and by far margin too. Ability to expand the frontier while basic market economics fill in behind is the reason why there is any human progress at all. Artificially stopping to share the cake "better" through arbitrary authority and definitions, only puts a brake on it...for more negatives than positive overall in long term. The evidence is all there to see (extreme case: USSR).



Again you seem to be thinking JICA loan is open to spend anywhere. It is specific to only this (its their money and investment to seek return on). Foreign capital be it FDI or loan based often is targetted to get the high quality amounts (given it can be managed by investor as they want it).

Are we going to say no to FDI from say General Electric, GM or Honda because hey it doesnt govern affordable health care, education, housing etc?

One of the reason why many people fail at so many things in life is because they force an order of events where none actually need to present! The same is happening here too! Folks are so much focused on order of doing things that they forget to take advantage of opportunities available. HSR vs existing rail tracks.

Think about it. I have seen people arguing that 'I will only invest when I have income of more than 50K per month'. Thats a real statement I heard from folks around me. There were tax free bonds available at that point with interest rates running all the way to 8.7% But NOOOO! They have spare money of order of 3-4 lakhs sitting idle but they won't encash this opportunity because of some arbitrary event hasn't happened. No wonder most of the folks are messed up in their financial decisions. They think too linearly, which opportunities around them come following a non uniform patter.

 

[Dem!god]

I disagree, the right question is "at What price point". The Japanese offered funds at such a competitive terms that it makes sense to lock down that benefit now. When you are making changes or improving, there are things which can and should happen in a certain order, rest of the things should be decided by opportunity open to you. Japanese provided a good opportunity in terms of favorable funding.

Government can still put money in building more railway tracks. One is not exclusive of other. Japan is surely not providing funds at cheaper interest rate to upgrade our old tracks.

India needs funds to reboot it's current raiways system. Loans should have been taken revamping the current infra. Flights are better option in india then to travel by bullet train. Whats the need of hour is semi high speed railways with punctual running of trains. Every train in india runs late aur baat hum bullet ki karte hai. Pehle jo saamne hai ussko theek karo naa.

 

[anant_s]

First of all, Mumbai Ahmadabad HSR link is based on two solid facts:
1. Traffic Volume
2. Paying Capacity of people.
The route will pass through some of the fastest growing cities in India viz Surat and Vadodara.
those who travel on this line (i do frequently) will understand how packed higher classes of accommodation (AC 1 &2) are on the route including Shatabdi express which despite having two executive class is almost always packed.
this gives us a fair idea of existence of a customer class that is willing to pay higher fare for speed and service. ergo the HST on the route.
By present estimates, the fare will be close in range of economy travel (air) and here Railway can provide a 3 hour end to end Mumbai Ahmadabad service which will compete with air travel (taking into 45 minutes check in time limit for domestic travelers).
Second the question of its utility, HST especially as Chinese model has shown can get popular very quickly especially with budget travelers. Yes it requires massive infra-structure capital cost, but it pays off relatively quickly. I've no doubt in my mind, it will succeed in India too.
Finally on question of railway finances. HST is a terribly costly technology and requires tremendous patience on part of operator as far as economics is concerned. However with Japan offering soft loan and long payback period, it probably isn't a bad idea. However its duplication across nations will require Railway equity which already is stretched badly. The first priority of DFC must remain unchanged.
Overall should India take HST plunge.
Off course!!

 

[GodToons]

Let me quote an example which will fit in context of current discussions.

In 2003, when Delhi metro work was starting. I have met lots of people saying "what is need to metro in Delhi having infra expense of Rs5000Cr (estimate for PH1) that time". "Would be happy with more buses"

Skip to 2017 Delhi.. this metro is now lifeline and people says that it is best decision for Delhi in last couple of decade.
Point is: All is speculation based on infra cost, recovery. Only time can tell if it is successful or not.

 

[ashok321]

In Japan's efficient world of Shinkansen, left right and center, these trains blend in perfectly with other high tech surrounding of building, bridges and cement jungle, but such would not be the case in case of India, which would look like a Zenaida asiatica (white-winged dove) among the corvus corax (raven), considering the surrounding structures of Indian infrastructure to be incompatible cosmetically, and if that would not be enough, there would be some folks defecating in the open, exposing their genitals to the high class paying passengers of the future to their dismay.

Mera Bharat mahan.

Okey.

 

[EndangeredSpecies]

India needs funds to reboot it's current raiways system. Loans should have been taken revamping the current infra. Flights are better option in india then to travel by bullet train. Whats the need of hour is semi high speed railways with punctual running of trains. Every train in india runs late aur baat hum bullet ki karte hai. Pehle jo saamne hai ussko theek karo naa.

You are still not getting it. Who will provide that funding and more importantly at what interest rate?
For HSR we are getting funding very cheap from Japan. Which is why HSR is getting traction (no pun intended).

For current railways system, India needs to secure funds from somewhere. ADB etc etc, may be?

 

[tw00tw00]

For current railways system, India needs to secure funds from somewhere. ADB etc etc, may be?

Why not raise ticket prices to pay for upgrades of existing lines?

 

[EndangeredSpecies]

Why not raise ticket prices to pay for upgrades of existing lines?

It will hurt poor people the most.