Economy

Critics, India’s Bullet Train Project Could Be the Path to the Future

The only question that remains with regard to the bullet train project is whether the new team lead by Piyush Goyal and Ashwani Lohani can deliver.

Prime Ministers Narendra Modi and Shinzo Abe look at a model of the bullet train. Credit: Twitter/@RailMinIndia

Prime Ministers Narendra Modi and Shinzo Abe look at a model of the bullet train. Credit: Twitter/@RailMinIndia

The bullet train project is finally on. The project is estimated to cost Rs 1.1 lakh crore, and will cover a distance of over 500 km from Mumbai to Ahmedabad in about two hours. The train is expected to be completed in 2022 to commemorate the 75th year of our independence. But does India need a bullet train now?

Skeptics and cynics say this move is leading to a waste of resources that can be put to better use for the poor of the country – more subsidised schools, hospitals, child nutrition and so on. They say this project has only a show-off value, which is a cruel joke in a country so miserably poor. This is indeed a strong argument against according priority to bullet trains in the circumstances India is facing currently.

In The Brown Sahib, noted Sri Lankan journalist Tarzie Vittachi wrote about a demonstration he witnessed of “revolutionary tyre wheels” for bullock carts, promoted vigorously by an Ahmedabad institute in a village. He inquired of a bystander who seemed like he would avail the cheap loan to buy the cart; the fellow pointed to Vittachi’s old Austin car standing by the roadside and said he would rather go for the car if Vittachi put it up. Vittachi somberly concluded the nets on the Raisina hill have no clue about what folks in the countryside desire. That was in the Nehru era, more than half a century ago.

Recall the more recent doubts cast on the now ubiquitous mobile phone, the metro train with its costly fare, and the computerisation of government offices. Each is now a success, each is now part of our lives and our kids would not even know a life without them. In short, the prevailing cynicism about the bullet train, whether on the street or in learned circles, is completely out of whack with what people really desire.

From the economic, or more precisely financial viewpoint, the Japanese loan for 80% of the project cost, which is almost interest free (0.1% only) with a moratorium of 15 years before repayment commences over 35 years, cannot be bettered.  Is there an exchange rate risk caused by the appreciation of yen against the rupee? Perhaps, but if the risk is hedged by paying some additional cost, the change fluctuation risk can be managed. It may still work out relatively cheap. Besides, the technology is also coming packed with the loan, which is generous. It will enable local manufacturing to scale up both in regard to railways and others – there are bound to be spin-off advantages accruing from it for associated industry in general. Therefore, the argument of wasteful use of resources also is unsubstantiated.

India’s common people, on the one hand, worry about the safety of their women, children and elderly, and on the other, about the lack of business opportunities. The concern for their kids’ malnutrition, education et al, is beginning to be considered an insult to their own ability to take care of themselves and their family. The paternalism of the feudal mai-baap sarkar is increasingly seen, at least by the young adults, as such. The socialists pushed for state-sponsored schemes that enabled corrupt middle-men, petty babus and pettier netas to fill their pockets. This was universally true, in erstwhile Soviet Union, in China and in every other socialist country in the world. Prosperity has taken place only where the state ensured law, order and level playing field. Productivity is the only mantra worth adhering to.

The biggest benefit of the bullet train project is that it would shrink distances in this vast country. Credit: PTI

The biggest benefit of the bullet train project is that it would shrink distances in this vast country. Credit: PTI

But the biggest benefit of the bullet train project is that it would shrink distances in this vast country. It will lead to a free and frequent movement of people, expand jobs and socialising opportunities as well as politicking, if the young are so inclined. The country will be welded together far more strongly in a couple of decades when a dozen more such bullet trains travel between metropolises such as Delhi, Jaipur, Dehradun, Chandigarh, Lucknow and the like, and in similar clusters in the south, east and west, and then across the country over what is known as the golden quadrilateral: Delhi, Chennai, Mumbai and Kolkata – each connected to the other directly. Historically, railways have played a vital role in the country’s economy, society and politics. Since independence, however, this sector has faced neglect and over the last 50 years or so, it has been cursed with the most unimaginative leadership – political and bureaucratic. But there were extenuating circumstances; the entire country was ruled by mediocrity, timidity and an absence of pride unlike in the first flush of independence.

Political ideologies are totally irrelevant today. The new regime in India, particularly, may be bereft of intellectual heft, as Ramachandra Guha said, but it has to be credited with concentrating on programmes – taken out of the UPA era even – and attempting boldly to do things: demonetisationGoods and Services tax (GST), ratcheting-up relations with Israel, calling China’s bluff, surgically striking Pakistan and claiming to have done so. What will be the result of these actions in the long run is arguable. From a comatose era that preceded it, this action-oriented change is welcome. It may well take this regime past the 2019 election for a further five-year period; the opposition’s disarray only heightens the possibility.

The only question that remains with regard to the bullet train project inaugurated on Thursday is whether the new team of railway minister Piyush Goyal and Indian Railway Board chairman Ashwani Lohani can deliver. Goyal has – in his short period in the limelight – already proved his dynamism. The other half of the team, Lohani, is a railway officer of the mechanical department who brings rich and varied experience from the public sector – he was earlier the commissioner and managing director of Madhya Pradesh Tourism Development Corporation, chairman and managing director of India Tourism Development Corporation and of Air India – on top of railway experience. Together, they can potentially deliver. But Lohani may not have five years left. At any rate, the project should be monitored on a monthly or at least a quarterly basis against publicly pre-declared milestones. Can the Goyal-Lohani team do for bullet train what E. Sreedharan did for Delhi Metro? They do not lack political backing to achieve it.

C.S. Rao is a former Director Finance at the Centre for Railway Information Systems.

  • Anjan Basu

    ” Political ideologies are totally irrelevant today”, says the writer. He may have missed the point that such statements are strongly ideological in nature themselves. ( Read George Orwell.) Such assertions may still gladden the cockles of neo-liberal hearts because they seek to damn ‘the failed socialist project’, and that only. The bigotry of peddling laissez faire market economy does not look even remotely ideological to them, even though a truly ‘free market’ is a chimera. But, the high advocates of an ‘aspirational’ India will much rather have many Bullet Trains than feed and clothe the teeming millions that live semi-human lives in India today. Apparently whole impoverished communities have told our author here that they don’t mind starving and dying without healthcare as long as spanking new monsters whirl around the Indian landscape at dazzling speed. The writer talks derisively of subsidies. He doesn’t , of course, mind the humongous subsidies that the govt doles out to ‘ India Inc’ year after year by way of tax and duty cut-backs. If this is not an ‘ideological ‘ position, what is? We may not like to hear it, but Brown Sahibs are out there in plenty in our great ‘aspirational’ India today. They think they speak for all Indians. In fact, they can and do speak only for an India which lives only in their own nationalistically fired imagination.

    • http://socioproctology.blogspot.co.uk/ windwheel

      Wow! A rebate on tax is the same as a subsidy! Who knew! Apparently whole impoverished communities have told Mr. Basu that they reduced their tax assessment by hiring a Tax Accountant.
      Japan had a bullet train a long time ago and it reduced ‘Duality’. Prof. Morishima said so. But Anjan is ignorant of any such thing. Why? He is a bit of brown alright. But not a Sahib. That is an Islamic term. The Sahaba were the companions of the Prophet (p.b.u.h).
      Fatwa this fellow by all means.

  • Ashok Akbar Gonsalves

    My goodness, is this the same guy who wrote this:

    https://thewire.in/22732/theres-no-point-putting-lipstick-on-the-railways-mr-prabhu/

    where he says:

    “The current rail minister could have scored hugely for his government – which is suddenly seen to be fast loosing its sheen. He is thought to be one of the few cerebral individuals in a government that has quite a few anti-intellectuals on board. Bullet trains, passenger facilities, wi-fi enabled stations, mobile booking facilities are all cosmetic.”

    He seems to have undergone a remarkably successful brain transplant!

    • Anjan Basu

      Well, you don’t grudge somebody a large helping of national pride, do you? Not today, when national pride is all the rage and changed hearts can often be a big help.

      • Ashok Akbar Gonsalves

        No, I dont. If he has ingested a stiff dose of the pride tonic, he is welcome to it. But then he should say as much and leave it at that, instead of over reaching himself by presenting the most ridiculous of rationalizations!

        • Anjan Basu

          Well, all grand rationalisation projects are intrinsically irrational. This is one such grand project, because it is otherwise so patently indefensible.

  • C S RAO

    Difficulty is people cannot resist reading what they want to in my two pieces. Mr Anjana Basu read “ideology is irrelevant” but did not care to read the following sentence where I emphasize action based on a program. Mr Gonsalves, also does not read the very next sentence where I speak of a well laid out long term plan. Perhaps Railways heard me, gave a plan that is definitely long term. Therefore in my poor but straight thinking mind I saw merit in the bullet train project as now launched especially since it is cheap, repeat cheap and affordable, over which not a wink’s sleep need be lost, and gave it my thumbs up. Both gentlemen are ideological prisoners of the increasingly irrelevant left and mindless anti Modi or anti BJP wave in the high brow English papers. I am here speaking strictly and only of Railways taking their rightful place in the economic and social facet of the nation’s future. In the recent past it has fallen behind badly to prolonged socialistic planning – beyond its expiry date. Bullet train is perhaps a good start in reversing that moribund thinking of Railways, a bold one and to my mind assured of resounding success, provided the new team at Board rises to the task a la Sreedharan. If that is worrying for the gentlemen I regret to say I have no sympathy for them.

    • Ashok Akbar Gonsalves

      Mr Rao, so good of you to reply.
      In your article from last year, you in essence wrote that organizational restructuring and accounting reforms can “take the railways to the next orbit”. It was in comparison to these two broad corrective measures that you said that “bullet trains were cosmetic”, right?
      So how is it that you now see merits in the bullet train (BT) when I am sure these measures that you suggested havent been put in place?
      And your arguments in favor of the BT are quite ridiculous. “But the biggest benefit of the bullet train project is that it would shrink distances in this vast country. ” How, pray? How does just one BT that shrinks the travel time between just two of the richest cities in one tiny sliver of the country “shrink distances”? Our road, railway and airline networks cover almost every corner of our land, and the key to shrinking distances is in maintaining, improving and enhancing that network, not in building a single-point BT that shall serve just the rich between two rich cities. Or are the latter your idea of India’s “common people”, who according to you dont suffer from malnourishment and the other ills that poverty brings?
      Actually you give yourself away by saying “pride in our country” – the BT is a project that fills you with pride. Not because it serves the poor of our country in any way, but because the words “We have a BT!” sounds good to hear. So please do not try to spin this as a great step that will do wonders for the poor and deprived.

    • Anjan Basu

      Since since you mention me my name, here are my thoughts on your thesis. Yes, I did read through your piece, and put pen on paper only after that. ( Incidentally, that is what I am used to doing, if you would care to know.) But despite

    • Anjan Basu

      In my earlier comments here (given in response to your comments), I am sorry I may have been impolite to you when I talked about you ‘twisting’ my name. I realise now it may have been your unfamiliarity with my kind of name that made my name into ‘Anjana’. It was improper of me to adduce uncivility, and I apologise!

  • Anjan Basu

    You mean more generously inclined towards an ideology that has your sympathy, isn’t it? Don’t let us beat about the bush. There is no public policy that doesn’t have an ideological orientation, of one kind or another. The ones that happen to be to our liking are often touted as ‘practical’, while the others are dumped as ‘ideological’.

  • Anjan Basu

    Well, good luck to your high fantasy, rooted as it is in your work ( as you claim) with ‘the country’s poor’ who, your research has apparently revealed, would rather look wistfully at the bullet train than feed their children! And why waste your precious breath on ‘leftist intellectuals’? Hasn’t your research already established without a doubt that they are an extinct species? So, why? Won’t your energies, and your purpose, be better served by your rooting for ‘the BJP govt’s ( grand) initiative’? Well, you do such rooting quite impressively, despite the ‘non-ideological’ tag you like to wear.

  • http://socioproctology.blogspot.co.uk/ windwheel

    Well said because Anjan defies the laws of Economics? Sure. Okay. Good luck to you mate.

  • Anjan Basu

    Meaning? Whether I also believe in the binaries of ‘practical’ and ‘ideological’? No, I think not. You may not have noticed that I used the word ‘often’ when I talked about this, not ‘always’. The trend is gaining ground, though, and very quickly so.

  • Anjan Basu

    I hear the ‘Harvard vs Hard Work’ slogan’s undertones here. Parroting the leader even when half an opportunity presents itself can, I understand, be quite useful. Especially if a shuffling of stated positions on an important issue is involved, as seems to be the case here. I would be grateful to be enlightened on what you mean by running the railways ‘on socialistic principles’, though: you mean the rail coaches chanting ‘socialism zindabad’ rather than ‘Har Har Modi’ as they run, is it? Or you mean investing in basic rail infrastructure rather than in tawdry toys (like the BT)? You can very well choose to delude yourself if you want to believe that the public sector is the fountain-head of all corruption, while the private sector is always lily-white. Only problem is, you have to then pretend ( I am sure you will be very pleased to do that) that the over-invoicing of imports ( Adanis), seeking bogus refund of unpaid duties( the Adanis, again) or rampant price manipulations ( Ambanis) by the PM’s favourite private sector honchos are fairy tales. Well, I guess that may not be such a stretch for you. The world has already changed for you, and along with it, your views on important issues, too.