India to Sign Deal With Japan to Get First Bullet Train
India is set to sign a deal with Japan this week for get country’s 1st bullet train, with Tokyo financing the bulk of high speed rail project between Mumbai and Ahmedabad through a $8 billion loan, a leading Japanese business daily reported on Tuesday.
Indian Prime Minister Narendra Modi and his Japanese corresponding person Shinzo Abe will issue a Joint statement on the deal on Saturday during latter’s visit to India, The Nikkei reported.
Japanese Shinzo Abe will convey an offer of more than $8.1 billion in official Japanese lending for the roughly $14.6 billion project to link Mumbai & Ahmedabad with 505 km railway line, it said.
The 2 sides are discussing financing terms that would disburse about 100 billion yen a year over a decade or so. Senior Abe adviser Hiroto Izumi and Japanese foreign ministry officials on Monday wrapped up a journey to India, during which they discussed financing and other aspects of the project, the daily said.
A deal with India would be the 2nd Successful case of Japan exporting its bullet train technology to a foreign market, following a deal with Taiwan in 2007.
Japan failed to win a high speed bullet train deal in Indonesia earlier this year, losing out to a Chinese proposal.
India ranked as the 2nd biggest recipient of Japanese government – backed yen loans as of fiscal 2013, with a running total of 4.45 trillion yen, and the business daily said, citing Japan’s Ministry of Foreign Affairs.
The Railway loan deal could force it ahead of the largest borrower, Indonesia, which had a 4.72 trillion yen tally.
Once India decides to adopt Japanese train technology, it will hold a tender for contracts. A consortium including JR East, Kawasaki heavy Industries and Hitachi is expected to bid, the daily added.
The Japan International Cooperation Agency and India’s rail ministry began a joint feasibility study on high speed rail 2 year ago.
With trains zipping along at up to 320 kph, the Mumbai- Ahmedabad railway is expected to shorten travel time between the 2 western Indian cities from around 8 hours to roughly 2.
Manufacture is supposed to begin in 2017, with completion slated for 2023. India has plans for 7 high speed rail corridors, starting with this one.
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