Wednesday, March 12, 2014

High-speed rail essential for economic growth: Yoshiyuki Kasai

Interview with Chairman, Central Japan Railway Company

Calling for higher government investment in rail , Yoshiyuki Kasai, Chairman of Central Railway Company, which runs trains in Japan, told Anusha Soni not only bullet trains but development of high-speed rail transport in India between major cities is fundamental to the country’s economic growth. Edited excerpts:

Considering the limited capacity of an average Indian rail passenger to pay, do you think bullet trains are a viable option?

Although India’s per capita income is lower, compared to Japan, and it is widely believed that Indian passengers are not ready to pay higher fares, one must consider the overall economic impact of high-speed rail. It boosts the growth of related urban infrastructure projects, creates jobs and brings overall efficiency to the system. It is true that projects like bullet trains are very expensive. It costs about $130 million a kilometre at the construction stage. These costs would be comparatively lower in India because of cheap labour. But the process of industrialisation demands an efficient and quick transport system.

Are you working with Indian on any key project or giving any monetary assistance?

The governments of India and Japan have been working together and sharing knowledge. But we are not into giving any monetary assistance to Indian Railways.

Do you think privatisation or corporatisation of Indian Railways is the way forward for further reform?

One must be careful while taking these steps. The situation of Indian Railways needs to be analysed and the reform should be a gradual process. It is true that bureaucracy does make things difficult. The options are nationally-owned public corporations or part-privatisation. Look at the international examples like the privatisation of British Rail, even Euro Rail, which has its own issues. So, the answer would be specific to the issues of Indian Railways.

Building a high-speed rail system is an expensive affair and it gets more difficult when private players do not show interest in investing in rail infrastructure.

The construction of high-speed rail infrastructure and bullet trains in Japan has been done with the aid of the government through a loan,  paid back as the system was operationally profitable. These are not the kind of projects in which private players would be much interested but public-private partnerships are the way forward. There is a local high-speed railway we are building in Japan between Tokyo and Nagoya and the major portion of the spending comes from the government. But the system has to be operationally viable and consumers should be ready to pay for the services. It cannot run on subsidies.


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