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Five years delay in Mumbai – Ahmedabad bullet train venture

Bullet Train, Mumbai-Ahmedabad, Train

There would be five years delay in the Mumbai-Ahmedabad bullet train project due to low participation by Japanese companies to tenders cancelled because of steep rates quoted by bidders and disturbances caused by the coronavirus pandemic. The prices quoted in many of the 11 tenders meant to be executed by Japanese companies were up to 90% higher than the estimates. Last year, the company had floated nine civil work tenders which could not be opened because of the coronavirus pandemic, officials said. The National High-Speed Rail Corporation has acquired 63% of the land for the project — about 77% land in Gujarat, 80% in Dadra Nagar Haveli and 22% in Maharashtra.

Another hurdle in the path is the percentage of the total cost of the project, the total cost of the project is pegged at Rs 1.08 lakh crore and as per the shareholding pattern, the Government of India is to pay Rs 10,000 crore to the NHSRCL, while the two states involved, Gujarat and Maharashtra, are to pay Rs 5,000 crore each. The rest is to be paid by Japan through a loan at 0.1% interest.

“Because of COVID we had to postpone the opening of a few of the tenders. It is difficult to assess the impact of the pandemic on the project as it is still continuing”. Apart from land acquisition and opening of tenders, a major cause for delay could be cost escalation owing to a fall in the rupee against the Japanese yen. Officials said that to complete the project, the NHSRCL has divided the work in 26 packages, each has to provide a minimum of 30 months’ time for the contractors to finish their work.

“So, even if the land acquisition is completed and tenders are opened, NHSRCL will be unable to finish the work within the deadline. Also, the Japanese who have been allotted land here have not been able to begin any of their works, which is sure to delay the project further,” said the official.

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