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Captive power plants: Lessons for Indian Rlys from East Japan

Guess what? The $23-billion East Railway Japan Company (JR East), which runs the Shinkansen or high speed rail network and metropolitan and regional rail services in Japan, meets most of its electricity requirement through self generation, Takeshi Tsuyoshi, General Manager, International Department, JR East, told BusinessLine.

JR East, which provides services in the eastern part of Japan, including the Tokyo Metropolitan Area, supplies 56 per cent of its electricity requirement from its own stable, with the remaining being purchased from outside. Also, in the Tokyo Metropolitan Area, the entire electricity used by JR East is self-produced.

This strategy has important lessons for Indian Railways, which faces high fuel cost and has been trying for long to set up captive power plants.

JR East revenue

JR East gets 67 per cent revenue from transportation services, with the remaining coming from non-rail businesses such as shopping centres, offices, hotels, restaurants offices, fitness clubs and even kindergartens in the stations.

From the transportation revenue, JR East gets 30 per cent from the high speed network, 66 per cent from the conventional lines in Tokyo Metropolitan area and four per cent from other conventional lines.

JR East makes about 15 per cent profits from in its railway and non railway business each. While the company has not been getting any subsidy from local and central government since 1987, when its was privatised, Tsuyoshi shared that prior to 1987, the government provided funds for building the infrastructure while these companies invested in the rolling stock such as trains.

High speed trains

For the expansion lines after privatisation, JR East has been ploughing back its profits from the transport operations to the new areas. “Not all sections are profitable. Some sections (more crowded ones) are profitable, which the newer ones take time to generate profits,” Tsuyoshi, who was visiting India to participate in a CII Rail Equipment conference, said.

Tsuyoshi also shared that not all high speed trains can run on the entire 7,458 km of JR East network. Of the 7,458 km of network, 1,470 km is Shinkansen or high speed network. However, there are some high speed trains which can run on both the HSR and conventional tracks.

Partnering with India

Japan has been pitching its high speed railway technology to India based on the fact that it is the “safest high speed railway system in the world and has recorded zero fatalities.” Japan International Cooperation Agency with India has completed the feasibility study for the Mumbai-Ahmedabad high speed section in July this year.

For high speed trains, from starting land acquisition to commercial run, the process takes about 15 years, said Tsuyoshi. JR East has offered to transfer technology for construction, operations and management for high speed rail systems.

http://www.thehindubusinessline.com/economy/logistics/captive-power-plants-lessons-for-indian-rlys-from-east-japan/article7802919.ece

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Posted by on October 26, 2015 in Uncategorized

 

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30 officials train in Italy for high-speed rail

In a move that heralds the beginning of the era of high-speed trains in the country, the first batch of 30 divisional railway managers (DRMs) are off to Italy to study the nitty-gritty of running and maintaining the track, the security aspects and other infrastructure required for such trains. The officials will attend a 15-day specially-designed course at SDA Bocconi School of Management in Milan.

The delegation, which includes DRMs of Izzat Nagar division, Bareilly, Lucknow and Firozpur, will gain expertise in running these trains at SDA Bocconi school of Management in Milan. Interestingly, DRMs of those areas where high-speed trains are scheduled to run have been chosen for the study course in the first phase.

In Delhi, Northern Railway spokesman Neeraj Sharma confirmed that the group, which left the country on September 8, are taking part in the training programme in Milan.

According to sources, the officials would be trained on the various aspects of making tracks fit for running high-speed trains, their maintenance and security aspects.

Another railway official, who did not wish to be named, said the government has decided to introduce high-speed trains on Mumbai-Ahmedabad, Chennai and Lucknow-Delhi routes in the first phase. Once the experiment succeeds, it will be extended to other routes. A survey of railway tracks on the above-mentioned train routes has already been made by a joint team of rail experts from South Korea and India. The team has already submitted a report to the ministry of railways which has to take the final call on this, they added.

According to sources, the ministry of railways has also chosen a site in Bareilly, along with two others in North India, where a factory manufacturing high-speed train engines is scheduled to be set up.

 
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Posted by on September 18, 2015 in Uncategorized

 

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High Speed Rail (India) – A Work In Progress

Often a subject of derision, due to its never ending woes, Indian Railways remains an irreplaceable national asset with a total network of 65,000 km that connects far flung areas of the country. It runs 12,000 passenger trains connecting around 8,000 stations spread across the country and carries over 23 million passengers per day. It runs more than 7,000 freight trains per day carrying about 3 million tonnes of freight.

India has the world’s fourth largest web of railway track and is considered second largest by usage carrying 8.4 billion people annually in 2014-15.

Notwithstanding the massive size, scale and glory of Indian Railways, the overall rail network remains in a decrepit condition owing to a variety of reasons but largely due to a lack of funds. India’s political realities have ensured that rail fares have not kept pace with annual inflation thereby creating a wide revenue deficit leading to a poor operating ratio.

The lack of funds stemming from low revenue has hindered expansion and modernisation plans. As a result of poor financial health, India’s high speed network comprises a few routes such as the Rajdhani, Shatabdi, Duronto, Garib Rath Express that run at a top speed of 130kmh.

High speed rail projects have been a financing nightmare globally, and India is no exception. The magnitude of the funding challenge can be demonstrated by the fact that the cost of laying a metro is three times higher than that of a regular rail line while a high speed rail project requires six times more investment than what is required to build a regular rail line. That Indian Railways has not been able to replicate China’s modernisation and expansion of its network is evidence of India’s resource shortfall.

Significance of high speed rail for India

Clearly, the lack of long-term capital is holding up India’s high speed rail plans. However, given India’s position as one of the fastest growing economies in the world and the growing needs of its businesses and aspirations of its people, the question now is not whether India can afford a high speed rail system but for how long can India afford not to have it.

Implementing the HSR network would lead to the upgrade of policies, procedures, human resources and organisational restructuring that is essential to run a modern railway system. If implemented in a planned and precise manner the spin-off effects of HSR trains on the economy can be very significant. It is an established fact that high speed rail spurs the revitalisation of cities by encouraging high density, mixed-use real estate development around the stations. It also fosters economic development in secondtier cities along train routes by linking cities together into integrated regions that can then function as a single stronger economy. Reduced travel time, increases in employment and industrial shipments, energy efficiency and low carbon emissions are some of the many known benefits of a high speed rail system.

Making high speed rail a reality

In light of this financial constraint, the government has permitted 100% foreign direct investment in railway infrastructure that includes high speed rail, thereby opening the railway sector to investment by international rail companies, foreign governments, pension funds, insurance funds and bilateral and multilateral funding agencies. In the Union Budget 2015-16, the government announced its decision to embark on an ambitious Diamond Quadrilateral Network of high speed rail, connecting major metros and growth centres of the country.

High speed rail – Indian and Global perspective

Below is a snapshot of various models of high speed rail employed by other countries:

1. Dedicated: Japan’s Shinkansen is an example of a dedicated high speed rail system with separate and exclusive high speed tracks. The system was developed because the existing rail network which was already congested with passenger and freight trains could not support the new high speed trains

2. Mixed high speed: France’s TGV (Train à Grande Vitesse) is an example of this model that includes both dedicated and high speed tracks that serve only high speed trains and upgraded, conventional tracks that serve both high speed and conventional trains

3. Mixed conventional: Spain’s AVE (Alta Velocidad Española) has dedicated, high speed, standard-gauge tracks that serve both high speed and conventional trains equipped with a gauge-changing system, and conventional, nonstandard gauge tracks that serve only conventional trains

4. Fully mixed: In this model, exemplified by Germany’s ICE (Inter-City Express), most of the tracks are compatible with all high speed, conventional passenger and freight trains

In the Indian context, the speed of semi- high speed systems will range from 160- 200kmh and high speed rail will range from 250-350kmh. The high speed corridors identified for the purpose of carrying out feasibility studies are Mumbai-Ahmedabad, Delhi-Chandigarh-Amritsar, Delhi-Chennai and Chennai-Bengaluru-Mysore. High speed trains with speeds of more than 160kmh would run on normal conventional tracks. Nine corridors, Delhi-Agra, Delhi-Chandigarh, Delhi-Kanpur, Nagpur-Bilaspur, Mysore- Bengaluru-Chennai, Mumbai-Goa, Mumbai-Ahmedabad, Chennai-Hyderabad and Nagpur-Secunderabad, have been identified for passenger trains with speeds of 160-200 kmh. The first passenger train at 160 kmh will run from New Delhi to Agra.

Financing

The following financing models are likely to be adopted.

  • Budgetary funding where Indian Railways retains the full control on construction, operation and maintenance of the HSR system
  • PPP wherein financing, construction, O&M and revenue risks are transferred to the private sector
  • Multilateral funding through soft loans
  • Government to government co-operation during construction and PPP model for operation and maintenance

Key determinants of an HSR project in India

The success of high speed rail projects in India is heavily contingent on the following factors:

  • Land acquisition: In 2014, almost 189 transport projects worth Rs 1,800 billion were held up due to problems with land acquisition. High speed rail tracks are typically laid in a straight-line so flexibility over land acquisition is limited
  • Environmental clearances: In India 40% of the 419 infrastructure projects worth Rs 20,000 billion are held up due to delay in project clearance. A delay in obtaining environmental clearances can have a knock on effect on the programme and costs
  • Financial feasibility: While evaluating the financial feasibility of the project, factors such as the anticipated revenue of the project and the availability of long-term finance should be taken into account based on current realities
  • Risk allocation: Risk allocation in large infrastructure projects in India, in its present form, is heavily skewed against the private sector. It has been seen that the private sector is often left grappling with risks that it is ill-equipped to handle. The government should, in the interest of the project, adopt the cardinal rule of risk allocation that the risk should be allocated to the party which is best suited to manage that risk
  • Other key aspects: In addition to the above, other factors which would play a major role before an HSR project is set up in India are as below:
    • Decision on the speed – whether 250, 300 or 350kmh
    • Acquiring the requisite technology
    • Corporate structure – to be a part of railways or be an independent organisation
    • Ownership – fully private or public private partnership
  • Appropriate financial incentives

Investment by the government

The Railway Minister informed Lok Sabha in March this year that laying high speed rail track will cost India Rs. 1-1.4 billion per km. Considering the staggering cost involved in HSR projects, all major high speed rail systems have been funded in part by government investment. Even projects like the UK’s High Speed 1 line and Taiwan’s high speed rail system, that were initially intended to be fully privately financed, ultimately benefited from heavy government investments in the form of loan guarantees and the purchase of ownership of the companies that built the rail lines. Some other instances where the government invested in high speed rail projects are as below:

  • The Netherlands’ HSL-Zuid line, which links Amsterdam and Rotterdam, relied on the public sector for 86 % of its cost
  • The Perpignan-Figueres high speed rail connection between France and Spain benefited from a public investment of 57 % of project costs
  • Portugal’s high speed rail network is projected to be built with 55 % of its budget coming from public sources.
  • Tours-Bordeaux high speed rail line in France will be built with 50% public investment from France and the European Union
  • The Japanese Shinkansen high speed rail network, the only HSR System to break even, was built by Japan National Railways. It has been privatised, with six large, regional, privately-owned companies responsible for operating high speed rail service

Conclusion

It may still be early days for high speed rail construction in India but the government’s allocation of vast funds for studying railway schemes speaks volumes for its determination. In addition, the presence of some of the best known engineering firms in India suggests that the government’s message is not going unheeded.

This update is authored by Clasis Law, Clyde & Co’s associated firm in India

http://www.mondaq.com/india/x/420092/cycling+rail+road/High+Speed+Rail+India+A+work+in+progress

 
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Posted by on August 15, 2015 in Uncategorized

 

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Elevated corridors for high-speed trains now

Railway Minister Suresh Prabhu is toying with the idea of the elevated tracks to fulfill Prime Minister Narendra Modi’s dream project of the superfast futuristic trains as only such corridors can allow trains at the top speed of 300-350 km per hour without endangering the lives of people and animals.

Experts invited by the Railway Ministry had suggested fencing of tracks that are to be used for the superfast trains, but the railway engineers pointed out that many tracks pass through the crowded cities which forces slowdown of even the existing trains and moreover there is no scope for further addition of separate fenced tracks unless the Railways resort to massive acquisition of land and demolitions.

Prabhu has, therefore, ordered preparation of a feasibility report for the elevated tracks to assess savings in terms of both cost and time and speed up the superfast trains as conceived by the PM. The Railways have already set up High Speed Rail Corporation of India to deal with the proposed high-speed rail corridor projects.

If the feasibility report is positive, the first elevated tracks will be built for the Diamond Quadrilateral Corridor covering Delhi-Mumbai-Chennai-Kolkata-Delhi as these cities are to be put on the high-speed trains.

Six other corridors have been identified for technical study to set up the high-speed elevated rail corridors. They are: Pune-Mumbai-Ahmedabad, Delhi-Agra-Lucknow-Varanasi-Patna, Delhi-Chandigarh-Amritsar, Hyderabad-Kazipet-Vijaywada-Chennai, Howrah-Haldia, and Chennai-Bangalore-Coimbatore-Kochi-Thiruvananthapuram.

There are already dedicated high-speed elevated tracks in Germany, France and Japan and China also focusing on the elevated rail infrastructure lately.

The Railway sources said India also has a successful experience of the elevated tracks as already implemented in some difficult stretches of the Konkan Railway. Prabhu wanted the feasibility report based on the elevated tracks used successfully in Delhi Metro.

Sources said the Railways so far find it difficult to even achieve the speed of 160-200 km per hour for some important trains as the bottlenecks are near cities and habitations very close to the corridors that forces the slowdown of the trains. They said the elevated tracks can be the only answer if the speed has to go beyond 200 kmph.

“We are still trying our best to attain a speed of 150 kmph for Delhi-Bhopal Shatabdi up to Agra but in vain due to technical and asset failures,” a Railway official said.

The elevated corridor is proposed to have two tracks at 15 to 20 metres above ground level only in the areas where the speed cannot be achieved in any other way, while some parts of the tracks may be even underground or at ground level as in case of the Delhi Metro, the sources said.

The Railway officials admit that it is a mind-boggling task as the Indian Railways could add just 11,808 km of tracks since Independence. The total length of the railway tracks in the country today is 65,808 km.

FPJ

 
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Posted by on June 27, 2015 in Uncategorized

 

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India should go for high-speed trains for faster growth: China

India should opt for bullet trains together with raising speed of trains on existing tracks to boost economic growth by improving connectivity, a combination that worked for China as well, a top railway official said here today.

With over a billion population and a large territorial area, India and China share the same conditions and up- gradation of railway infrastructure will result in faster economic development, Zhao Guotang, Deputy Chief Engineer of the China Railway said.
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Posted by on June 7, 2015 in Uncategorized

 

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India’s high-speed train in the offing

Prime Minister Narendra Modi has already arrived China and now all eyes are on the major outcomes from this visit.

The two countries are expected to sign a major memorandum on expanding cooperation in the building of a high-speed rail corridor between Delhi and Chennai.

For the People’s Republic of China, building the world’s largest superfast rail network has been closely linked to the country’s booming global ambition.

In the early 1990s, the average passenger train in China ran at a speed of only 48 kilometres per hour.

Roads were badly congested and people were forced to fly even for short journeys. It was in 1999 that China began building its first high-speed rail corridor.

Within 15 years, China built a national network that is bigger than all the highspeed corridors of the world put together. At the time of Independence, India’s rail network was nearly 54,000 km; while China’s rail network was onlyof 27,000 km. But since then, China has nearly quadrupled its rail network to about 1,10,000 km; while India has added barely 11,000 km of track in the same period.

When PM Modi announced his wish for a high-speed rail corridor linking India’s biggest cities, questions were asked about whether it’s worth spending so much on the project. Even in China, it was widely debated as to whether it was worth investing huge sums ofmoney on the project.

According to conservative estimates, the total cost of China’s high-speed rail corridor has been to the tune of $300 billion.

China’s early high-speed trains were imported or built under technology transfer agreements with foreign firms like Alstom, Siemens, Bombardier and Kawasaki Heavy Industries.

Chinese engineers then re-designed the train components and built indigenous trains that can reach operational speeds of up to 380 kmph.

The average speed on these trains at present is 200 kilometres per hour. In the run up to Prime Minister Modi’s visit to Beijing, Chinese authorities have been pushing for a pilot project to showcase the country’s high-speed prowess to India.

China is currently conducting a feasibility study for the $36 billion, 1,754-km Delhi-Chennai high-speed corridor. China wants to speed up implementation of a shorter high-speed rail corridor from Chennai to Bengaluru and from Delhi to Agra, even while the feasibility study continues.

Key decision A study done by the World Bank says that Chinese projects are one-third cheaper than the high-speed projects by other countries. But, India needs to decide whether it is prepared to entrust an infrastructure sector with grave national security ramifications to Chinese companies.

Days ahead of Modi’s visit, the Chinese ambassador to India has announced that deals worth US $10 billion are expected to be signed this week. A major part of this investment is likely to be for upgrading the Indian Railways.

Business Today

 
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Posted by on May 15, 2015 in Uncategorized

 

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Railways considering DMRC-like company for high-speed trains

The railways are considering setting up a separate entity, possibly a company like the Delhi Metro Railway Corporation (DMRC), to build and operate a high-speed train project connecting some of India’s biggest cities, a favourite scheme of the Prime Minister Narendra Modi.

Railway Minister Suresh Prabhu on Monday held a meeting of senior board members to review the status of the project, under which the cities of Chennai, Delhi, Mumbai, Ahmedabad and Kolkata are to be connected by high-speed rail links. The Mumbai-Ahmedabad link will entail an investment of Rs 70,000 core. Prabhu is said to be of the view, according to people familiar with the meeting, that the railways did not have the expertise to implement a project of such technical complexity. Modi has christened the high-speed train project as the Diamond Quadrilateral.

The possibility of creating a separate entity like DMRC through an Act of Parliament has been discussed in the rail ministry and was considered at the meeting, said the people cited. Though a High Speed Rail Corporation (HSRC) had earlier been set-up — this is a subsidiary of railway PSU Rail Vikas Nagam Limited (RVNL) — but the current thinking is this entity neither had the mandate nor the expertise to work on the high-profile project.

It was also decided at the Monday meeting that states should be made stakeholders in the project. “The attempt is to find the best professionals to implement the project and to insulate the railways from the operational aspect including the losses, if any. The railways, however, would continue to be the nodal ministry for administrative and technical purposes including safety,” said a senior officer, who was present at the meeting.

Prabhu had wanted to finalise details of the high-speed train plan, often referred to as Bullet Train project, to the Cabinet for approval before the government completed one year in office on May 26. “However, when he heard about the progress of the project, he decided not to rush into it. There were many unanswered questions yet about the financial viability of the project. Even the finance ministry had raised questions about it. The minister thought it was better to wait for the feasibility report of Japan International Cooperation Agency (JICA),” the officer explained.

JICA is carrying out a feasibility study for the 534-km Mumbai-Ahmedabad corridor and is expected to submit its report in July 2015. “It will be a detailed report which will examine the funding pattern, alignment, patronage, possible halts, fare structure and other details required for the project,” another official at Rail Bhavan told ET. The study was commissioned by UPA government in 2013.

The project is expected to be brought before the Cabinet after JICA submits its report. Railway ministry officials said Japan may be a key partner in the project, especially for the Mumbai-Ahmedabad corridor. “Japan already seems to have planned official development assistance from JICA with an infrastructure fund set up by Japan’s transport ministry,” the railway official said.

ET

 
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Posted by on May 13, 2015 in Uncategorized

 

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