India’s Bullet Train dream a very costly affair

Narendra Modi government’s Bullet Train Project from Ahmedabad and Mumbai may not be financially viable. According to an estimate, the proposed trailer will have to ferry 88,000-118,000 passengers per day, or undertake 100 trips daily, for the Railways to keep it financially viable.

[m9ad]

This estimate is not arrived with simple figures but it is an outcome by a survey conducted by IIM-Ahmedabad. The railways will have to set the ticket price for 300 Kms drive for every person and have to ferry 88,000-118,000 passengers per day so that the government can repay the loans with interest on time.

Japan came forwards with 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. Japan has offered a 15-year moratorium on loan. By then the operating costs can increase as well.