1. I. Need of High Speed Rail in India II. Key Issues and Challenges III. Implementation Options 2
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HIGH SPEED RAIL – CHALLENGES & OPTIONS: INDIAN PERSPECTIVE International Seminar on High Speed Rail in India February 01, 2013 Vinay Kumar Singh GM (PP&D) Rail Vikas Nigam Ltd. 1
1. I. Need of High Speed Rail in India II. Key Issues and Challenges III. Implementation Options 2
I. Need of High Speed Rail in India II. Key Issues and
Challenges III. Implementation Options 2
Slide 3
As per UIC definition, trains running at speed of 200 kmph on
upgraded track and 250 kmph or faster on new track are called High
Speed Trains. These services may require separate, dedicated tracks
and "sealed" corridors in which grade crossings are eliminated
through the construction of highway underpasses or overpasses.
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Slide 4
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Slide 5
High Speed saves Energy Costs and reduces Greenhouse Gases
0102030405060 Fuel equivalent grams per passenger-kilometer High
Speed Railway Bus Plane 51.1 29.9 18.3 17.6 12.1 Classic Train
Private Car
Slide 6
A HSR-line allows more passengers than an six lane highway per
hour Elevated rail corridors reduce the hassle of Land Acquisition.
Land requirements are Smaller 35 m
Slide 7
Reduction in commuting time between cities and added capacity
gives an excellent opportunity for decongestion of the mega urban
centers and growth of smaller towns and other cities.
Slide 8
The major challenges faced are: Major Urban centers are
severely congested: Dramatic growth in vehicle ownership in the
past decade. Accessing jobs, education - becoming increasingly
time- consuming. Billions of man-hours are lost with people stuck
in traffic.
Slide 9
Explosion in Inter City Travel Indias urban population - 285
million reported in the 2001 census and 377 million in 2011 census.
McKinsey Global Institute (MGI) projects - 590 million by 2030 (40%
of Indias total projected population). The rapid urbanization in
the country has triggered a growing demand for inter city traffic
between metropolitan cities and 2nd and 3rd tier cities. In absence
of HSR, passenger traffic of Airlines/ Car users is growing at 15-
20%
Slide 10
DECONGESTION of Metropolitan cities Tier I City Without HSR
With HSR Tier II Tier I City Small towns and Tier II & III
Cities Tier I City Tier II city
Slide 11
TRAVEL TIME ( Trigger for modal shift) Delhi (city centre)
Delhi Airport Chandigarh Airport.75 hr30 min1.25 hrs at Terminal +
1 hr Flying time Total time: 3.5 hrs Plane Delhi (city centre)
Chandigarh (city centre) Total time: 1 hr High Speed Railway
Journey time for air travel involves travel to airport, away from
city centers and waiting time at Airports. Distance between DELHI
to CHANDIGARH is 245 Km.
Slide 12
HSR is energy efficient and is less polluting than Road/Air
travel. Economically as well environmentally, Rail based Transport
system is ideally suited for India. Indian imports about 80% of its
oil requirement. HSR will use indigenous energy resources like
thermal/hydel/nuclear based energy
Slide 13
13 India became a decidedly road-dominant economy in the
beginning of the eighties with the railways losing out in respect
of both freight traffic and passenger traffic.
Slide 14
14 Introduction of TGV service in 1981-83 Evolution of first
Class rail traffic in France Before and after opening of the first
HSR line Existing long distance rail services have difficulties in
competing with road and air modes of transport, The new HSR lines
can stop the decline of the railways share on the long distance
transport segment along those corridor. It provides an attractive
transport offer in terms of reduced travel times and comfortable
journey. Despite the high investment cost it is economically
sustainable and need of the hour.
Slide 15
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Slide 16
16 System Integration (1) Political Will (4) Financing HSR
Project(s) (5) Land Acquisition (3) Economic & Financial
Viability (7) Selection of Technology High Speed Rail Development
(2) Selection of Project Corridor(s) (6) Policy Framework
Slide 17
17 Each HSR corridor will have a long gestation period and will
be highly capital intensive, so, strategic thinking is required at
the Apex level for implementing in a programmed manner Coordination
among Central Government Ministries, State Governments and
Government Agencies Success stories- National Highways, Airport
up-gradation, Yamuna express-way
Slide 18
18 Vast country Many potential corridors - Selection of pilot
Project; Economically/financially viable projects to be given
priority; Willingness of local governments to participate in the
project by way of land and funding support.
Slide 19
19 High capital cost will impact viability HSR will be a
dedicated line; High demand risk due to higher tariffs as compared
to conventional rail. Emphasis on other alternative revenue sources
like Real estate revenues, carbon credits, cross-subsidy from
road/air travelers.
Slide 20
20 The high capital costs of HSR makes it a financing
challenge. GOI may not fully fund the corridors. Most state
governments will have to raise finances by extra levies, real
estate etc. even for part funding Private sector may not have
adequate financing capability to fund the large HSR projects.
Proper project structuring by unbundling the projects into smaller
packages may be essential. Funding by multilateral and bilateral
funding agencies
Slide 21
21 Critical due to stringent alignment requirements HSR
corridors pass through conurbations or sensitive land; Strong
public protests adversely affecting large number of projects. Mix
of alignment choice- grade/ elevated/ tunnels
Slide 22
22 Robust policy framework for: Seamless implementation of
projects Assurance for attracting International investors Creation
of National High Speed Rail Authority
Slide 23
23 Choice of Technology: A) Fixed Infrastructure: Mix of
Embankment/Elevated/ Underground Structures and their dimensional
control; Construction Gauge; Fencing of the complete track/elevated
track; Electrical Installations. B) Fast Upgrading Technology
Rolling Stock Signaling and Communication Train Control Fare
Collection
Slide 24
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Slide 25
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Slide 26
26 French Govt. SNCF - French national rail operator Rseau Ferr
de France (RFF) State owned Access Charges (for use of rail
infrastructure) Access Charges (for use of rail infrastructure)
Infrastructure Manager Operator The first opened in 1981 between
Paris and Lyon (480 Km) and now total network 1887 km. French govt.
plan to have new 2000 km HSR lines by 2020. Borrowing from the
international markets to enable it to undertake major projects but
not on a particular project basis. This funding is supported by
government guarantee but is restricted to the amount that RFF can
repay from the access fees The rolling stock for the TGV lines is
procured by SNCF and is funded through lease commitments
Slide 27
27 In addition to borrowings, the TGV lines have also been
developed with grant funding from local sources. Funding pattern
for three TGV lines are: Funding by SourceTGV EstEast Rhine
RhoneBrittany loire French StateFrench State39%31%32% Regional
funding24%29%35% RFFRFF22%26%33% SNCF2%4%n/an/a EU10%8%n/an/a
Luxembourg4%n/an/an/an/a SwitzerlandSwitzerlandn/an/a3%n/an/a
Concession modelPartnership contract Rail operators pay an access
charge based on their actual use of the infrastructure Demand risk
lies with the concessionaire RFF pays a rental or availability fee
based on the performance of the private sector partner Demand risk
remains with RFF Forms of PPP models followed by RFF to create
Infrastructure
Slide 28
Infraspeed Consortium: Fluor Daniel BV, Koninklijke BAM/NBM
Amstelland NV, Siemens Nederland NV, Siemens Transportation
Systems, Innisfree Limited and Charterhouse Project Equity
Investment Limited 30 years Concession on DBFM (PPP) basis 28 HSA
Dutch govt 6 D&C contractors One D&C contractor Rail
Systems Network Connectio ns Substructur e Passenger Transport 125
km line between the Netherlands (Amsterdam) and Belgium border
(Schiphol). This lines provides connectivity of Amsterdam to
Brussels and Paris
Slide 29
29 The PPP did not include the transfer of any demand risk.
Infraspeed is remunerated on an availability basis, subject to
deductions for unavailability of the infrastructure. The Dutch
government finances: The substructure of the HSL The PPP
infrastructure payments to Infraspeed These are partly financed by
revenue from HSA Total costs: 7.2bn. The value of the PPP element
of the project was approximately 1bn. The 1bn project financing for
the PPP includes: 605m syndicated term loan (comprised of two
Senior loans with a term of approximately 27 years) 119m
subordinated debt bridge facility 15m working capital
facility.
Slide 30
30 Consortium led by Kawasaki Heavy Industries A concession to
finance, construct, and operate the High Speed Rail System for a
period of 35 years and a concession for HSR station area
development for a period of 50 years. Demand risk transferred to
the private sector operator A concession to finance, construct, and
operate the High Speed Rail System for a period of 35 years and a
concession for HSR station area development for a period of 50
years. Demand risk transferred to the private sector operator
Taiwan High Speed Rail Corporation: Alstom Transport SA of France
and Siemens AG of Germany The link Taipei to Kaohsiung - total
length of 345km. The project had a construction value of
approximately US$18bn. Infrastructure Manager Procurement of
Rolling Stock Taiwan Govt. 10 % of yearly earnings to government
for further HSR development during the HSR operating concession
period regardless of the performance of the concession company. The
accumulated amount could not be less than US$3.4bn. 10 % of yearly
earnings to government for further HSR development during the HSR
operating concession period regardless of the performance of the
concession company. The accumulated amount could not be less than
US$3.4bn.
Slide 31
31 Considering the case studies, following could be the
implementation options Non PPP Option: The project are implemented
by the Government on EPC basis PPP Options Option 1: Design, Build,
Finance, Operate and Transfer (DBFOT) of the entire project by a
single Private Developer Option 2: Unbundling the project into
different components, so as to make the project components
attractive to private players from the perspective of affordability
in terms of size and risk allocation: B&T (Fixed
infrastructure) DFOT (Train operations)
Slide 32
32 Whether project is implemented through PPP or partial
Government funding route, pre-construction activities should be
started in a programmed manner Government guidelines MOR has
already created a company named High Speed Rail Corporation of
India as a subsidiary of RVNL.
Slide 33
33 Project Development Activities A separate fund may be
created To be recovered from viable projects along with additional
fee Rolling fund for further project development activities Funding
Support for PPP projects: Viability Gap Funding
Multilateral/Bilateral loans by providing Centre government
guarantees Centre government guarantee for Long term Bonds of
Project SPVs
Slide 34
34 Funding Support for Non-PPP Projects Directly funded by
Centre/State Governments Other Sources of Funds Revenue share from
Concessionaires (train operators) Contribution from State
Governments Real Estate Development
Slide 35
35 Project CorridorsStatus of Prefeasibility Studies Pune
Mumbai - AhmedabadFinal Report submitted. Delhi
Agra-Lucknow-Varanasi- Patna Final Report submitted. Howrah
HaldiaFinal Report submitted. Hyderabad-Dornakal-Vijaywada- Chennai
Draft Final Report submitted. Chennai-Bangalore-Coimbatore-
Thirvanantpuram Draft Final Report submitted. Delhi Chandigarh -
AmritsarConsultant yet to be engaged
Delhi-Jaipur-Ajmer-JodhpurConsultant yet to be engaged