Mumbai-Ahmedabad Bullet Train Will Need To Make 100 Trips A Day To Repay Loans: IIM Study

The proposed bullet train between Mumbai and Ahmedabad will apparently have to make at least 100 trips or shuttle 88,000 to 110,000 passengers every day to ensure repayment of loans with interest, in time.

REUTERS/Richard Chung (TAIWAN)
Bullet train, Japan. Image| REUTERS/Richard Chung (TAIWAN)
A study conducted by the Indian Institute of Management, Ahmedabad(IIM A) titled “Dedicated High Speed Railway (HSR) Networks in India: Issues in Development,” suggests that if the tickets for 300km journey are priced at ₹1500, fifteen years after the train starts operating, it will have to carry around the said number of passengers every day to remain viable financially. 
It should be noted that Japan has offered India a concessional loan of 97,636 crores to fund about 80 percent of project costs, where the repayment starts after 15 years of the start of operation. The remaining money comes from Central Government.
Japan signs agreement to fund ₹98,000 crore Mumbai-Ahmedabad bullet train project.

The paper jointly authored by Prof. G Raghuram and Prashanth Udayakumar assumes that one train would carry about 800 passengers and each passenger would typically travel 300km. The total distance the train covers is of course 534km. Considering the running time for the train, it would have to make a total of 100 trips per day, or 50 trips each side, which is 3 trains in one direction each hour.
Modi in Bullet Train, during his Japan trip in 2012.
Modi in Bullet Train, during his Japan trip in 2012.
The paper also mentions that the choice of route is good as it connects India’s first and seventh most populous cities, with major economic development between the two cities. That coupled with the great financing from Japanese makes it even more tempting.

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