Mumbai-Ahmedabad bullet train

A fast-track pact between India and Japan

Business & Politics

December 15, 2015

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Mumbai and Ahmedabad are both fast growing cities of India in terms of economy and infrastructure. Mumbai is already a business hub and Ahmedabad is becoming a business hub with the infrastructural developments that took place in the last few years like smart cities; however getting between the two by rail is not fast at all. Covering over 500 km, the trip takes about eight hours but by 2023, it could take about three hours by new bullet trains made by Japanese technology.

To take forward the strategic and global partnership to a new height, a USD-12-billion deal for India’s first ever bullet train network, has been signed between Prime Minister of India Narendra Modi and his Japanese counterpart Shinzo Abe, during the recent India visit of Abe. Not just a deal for high speed train, but it is the low cost coupled with the 50-year tenure of the Japanese loan. Japan has offered a loan amounting to 81 per cent of the total cost.

Modi said, “No less historic is the decision to introduce High Speed Rail on Mumbai-Ahmedabad sector through Shinkansen known for speed, reliability, safety.” Last year, the Modi government had allowed 100 per cent foreign direct investment in the railways, paving the way for collaboration with global firms for India’s high-speed rail programme. The development comes as a setback for China, which had been aggressively pitching to partner India in building the planned 10,000-km network for bullet trains. A deal with India would be the second successful case of Japan exporting its bullet train technology to a foreign market, following a deal with Taiwan in 2007.

The construction of the Mumbai-Ahmedabad high-speed connection is supposed to begin in 2017, with completion slated for 2023. India has plans for seven high-speed rail corridors, starting with this one.

Nuclear and Strategic Partnership

The two leaders also issued a joint statement on ‘India and Japan Vision 2025: Special Strategic and Global Partnership Working Together for Peace and Prosperity of the Indo-Pacific Region and the World’, which stated that the two prime ministers welcomed the agreement reached between the two governments for cooperation in peaceful uses of nuclear energy and confirmed that this agreement will be signed after the technical details are finalized. In addition, Modi announced that “Recognising our special relationship, India will extend ‘visa on arrival’ to all Japanese citizens from March 1 2016.”

Japanese companies won’t be the only ones who are part of the Modi’s agenda. Last month, General Electric and France’s Alstom won contracts to supply Indian railways with new locomotives. The government said that by 2020, it will invest USD 137 billion in the Indian railway system which serves 23 million passengers daily.



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