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India’s first bullet train corridor may be world’s cheapest high-speed service

Discussion in 'World Economy' started by m2monty, Jun 4, 2015.

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  1. m2monty

    m2monty Lieutenant FULL MEMBER

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    [​IMG]By keeping the fares low, the bullet train will be able to steer clear of a fare war with airlines, while also retaining the existing business of higher-class railway travel.
    India’s first bullet train corridor, between Mumbai and Ahmedabad, could turn out to be the cheapest high-speed train service in the world.

    The Japanese team working on its feasibility study has worked out its “fare box revenue” model, according to which the bullet train fare will be just one-and-a-half times more than the AC-I fares of other trains on the same route.

    According to this model, the Mumbai-Ahmedabad bullet train fare works out to about Rs 2,800, calculated on the basis of the current AC-I train fare of Rs 1,895. Currently, trains on this route take about eight hours for the 534-km journey. The bullet train is expected to take less than two hours.

    RELATED
    Japan’s Tohoku Shinkansen (Hayabusa trains) charges about Rs 8,000 for a 713-km ride on the Tokyo-Shin-Aomori sector. A second class ticket on China’s Jinghu High Speed Railway for the Beijing-Shanghai route costs over Rs 5,000.

    In India, initial estimates a few years ago had pegged the fare for this corridor to be in the same range. Officials, however, said the latest study of the possible fare model gives a more realistic picture.

    The report is likely to be submitted to the Railways Ministry in July. The Japanese team carried out a survey of people travelling on the proposed corridor, asking them how much they would like to pay for a bullet train service with a speed of about 320 kmph. Apart from the complex mathematics of the fare box revenue model, the feedback obtained from the people was also factored in while calculating the likely fare, said sources.

    As per the team’s estimates, about 40,000 people are going to use the corridor every day by 2023 — when the bullet train service is expected to begin. The AC-1 fares for this sector in 2023 would serve as the reference for the bullet train fares.

    The study found that pricing the tickets any higher would make the flights a more attractive option, and any lower would not support the maximum revenue generation. By keeping the fares low, the bullet train will be able to steer clear of a fare war with airlines, while also retaining the existing business of higher-class railway travel.

    The corridor is expected to have around 10 stations, and is supposed to cost Rs 98,000 crore, after factoring in inflation and taxes. Work on the corridor is expected to be completed about eight years after it is commissioned.

    India’s first bullet train corridor may be world’s cheapest high-speed service | The Indian Express
     
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  2. sam2012

    sam2012 Captain FULL MEMBER

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    This is good but India needs power full 5500hp or 6000 hp hybrid engine which can operate both in electrified and non electrified sector which will reduce engine change and maintenance of huge loco inventory ​
     
  3. Paliwal Warrior

    Paliwal Warrior Lt. Colonel ELITE MEMBER

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    the cheapest shoud not be considered based on fares charged

    but

    economic viability of the project at those fares

    otherwise it will be just another subsidy guzzling monolith

    subsidising the rich people (those who can afford 3000 rs ticket can also afford 5000 rs ticket) at the expense of the poor of india
     
  4. INDIAN NATIONALIST

    INDIAN NATIONALIST Major SENIOR MEMBER

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    It will be excellent for PR; a tangible national development that can be experienced and directly useful to all citizens and tourists alike; and a point of pride for all Indians.

    Indians of all classes have a strong concept of public transportation, we have a history as a train culture, and India is perfectly sized and populated to derive maximum advantage of this technology, if executed and maintained correctly.
     
    Last edited: Jun 5, 2015
  5. abhitej

    abhitej Captain SENIOR MEMBER

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    Checked the price for Mumbai - Ahmadabad flight ticket. Booking one week before journey costs me 3800 for return ticket. Now with high speed train it will cost me 2800 + 2800 = 5600. Why the hell will I pay 50% more for high speed rail than plane. India has the cheapest airline service in world. We do not need high speed rail. Reality is high speed rail is expensive compared to planes. China has high speed rail but it is subsidized by government. China rail has debt of USD 500 billion. Wait for some days & see China rail get bankrupt. US does not have high speed rail. This is not because they do not have money or technology. This is because they take commercial decision & high speed railway does not make commercial sense.

    Now lets take a look at economics of high speed rail. It will cost 60000 crores to construct high speed rail between Mumbai & Ahmadabad. You need to get 10% return to pay debt so you need to earn 6000 crores per year just to pay interest. 6000 crores is more than profit of entire airline industry in India. That you need to earn just from single route. For capital budget of 60,000 crores you can buy 100 airbus 320. This is more than fleet size of Indigo Airlines, the largest in India. Now return ticket will cost 6000 as per their estimate. So to recover 6000 crores to pay for interest cost on 60000 crores you need to sell 1 crore tickets every year. That is more than twice the population of Ahmadabad and I am not even considering the operating cost. All airlines together sell 60 lakhs tickets in India every year and you need to sell 1 crores tickets just on Mumbai Ahmadabad route to pay interest cost.

    Then there are operational difficulties in constructing high speed rail line. Where is the land in Mumbai to build high speed rail line. You need to build railway station at Vasai. Who will travel to Vasai to take a high speed rail. Then there is politics. Every MLA will want train to stop in his constituency. In the article it is mentioned that they will have 10 stations between Mumbai & Ahmadabad. So a stop every 50 km. High speed rail will not be able to accelerate to its full speed and we have a stop.

    We need to invest on existing railway network to improve its efficiency. Build more double tracks and complete electrification project. If we increase average speed of system to 100 kmph it is more than enough. Foreign governments will try to sell high speed rail to India as they get revenues. But our imports will increase. If any foreign government is too keen, let them build and operate the high speed rail without any financial liability on our government. We must only provide land. I am sure in such a scenario no one will invest. They just want Indian government to take financial burden so that they can sell their technology.
     
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  6. r2d2 ka bhanja

    r2d2 ka bhanja FULL MEMBER

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    bullet trains are not suitable. rather higher speed modified gauge would be better, perhaps speeds of up 150-180 km/h on major routes. both more realistic, feasible and safe. the number of problems with existing hsr lines are often covered up, including constant loss in perpetuity of both money and lives.
     
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