Bullet train will need 100 trips daily to be financially viable: Study
AHMEDABAD: The proposed bullet train between Mumbai and Ahmedabad will have to ferry 88,000 – 118,000 passengers per day, or undertake 100 trips daily, for the Railways to keep it financially viable, according to a report by Indian Institute of Management Ahmedabad (IIM-A).
The report, titled, “Dedicated High Speed Railway (HSR) Networks in India: Issues in Development,” states that if the Railways set the ticket price at Rs 1500 for 300km drive per person fifteen years after the operation, it will have to ferry between 88,000 and 110,000 passengers every day to ensure that it repays the loans with interest on time.
Japan has offered a concessional loan of Rs 97,636 crore to fund about 80 per cent of the project cost with a repayment period of 50 years beginning from the 16th year of operation at an interest rate of 0.1 per cent.
For the remaining 20 per cent loan, the authors assume 8 per cent average rate of interest (on Rs 20,000 crore to be funded by Centre). Japan has offered a 15-year moratorium on loan, so revenue concerns for the Indian Railways will arise from the 16th year, the authors state in the paper.
The total distance covered by the train will be 534 kilometres.
The paper has been jointly authored by faculty members G Raghuram, professor of the institute’s Public Systems Group, and Prashanth Udayakumar.
Fifteen years after the bullet train becomes operational, while the actual operating cost is not known, the paper assumes two scenarios by pegging operating cost at 20 per cent and 40 per cent of revenue.
“So if the Railways earn Rs 100 revenue, Rs 20 or Rs 40 will go for maintenance, and remaining surplus money will go for cash payment of loan with interest. Now, to cover the loan with operating cost in two scenarios, we consider passengers travelling an average 300 kilometres. In this case, we will need 88,000-118,000 passengers respectively for both the scenarios,” Raghuram said.
“Typically one train carries 800 passengers, so to carry 88,000 passengers daily, you will need to take a total 100 trips, or 50 trips each way. So, we need three trains every hour in each direction,” he said.
I think its feasible solution and We should go ahead with this project this Train will be our National Pride and In Long term it will be profitable population of India is going to increase multi fold not going to decrease 🙂
Although it seems to be a costly affair , but from prestige point of view its operation is a must .
Do we really need it. Prabhu and Modi could do well to make the existing trains good and ensure easy online booking.
i dont like modi but this bullet train thing is long overdue for india, just like we have built metros we need this bullet train so that such experiments are replicated elsewhere, its important for our nation irrespective of feku, pappu or dharna is in power
Tax payers money shall be used for general improvement nad safety of Indian Railway. Adani and Ambani shall invest in bullet train. Why public money?
100 trip/day means the bullet train project is viable. We have to consider 20-year down-the-line projections, because the project will take at least 20-years being India
will it also be able to transport water to drought hit areas
its a disaster in the making..