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The Dedicated Freight Corridor & the High Speed Railway

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The Dedicated Freight Corridor & the High Speed Railway Joint Feasibility Study for Mumbai-Ahmedabad High Speed Railway Corridor FINAL REPORT year of operation (2018) the Fixed cost Component is expected to be high i.e. about 72% of total TAC, however, it will progressively decline over time as traffic volumes grow and 25 years later the ratio of Fixed Cost to Variable Cost is projected to be in case of the Eastern Corridor 26:74 and Western Corridor 49:51. The TAC is planned to be fixed in such a manner that DFCCIL neither suffers losses nor makes windfall profits. Another interesting aspect is the relationship between the Track Access Charges paid to DFCCIL and the apportioned revenue to the length traversed over DFCCIL lines. In a scenario when freight tariff is assumed to grow at 1% the TAC is only 26% of the apportioned revenue in the first year (2018) for both corridors combined and increases to 34% in the 25th year and 50% in the 50th year. The increase is because the costs of maintaining the system are assumed to grow at 6% annually whereas tariff only grows at 1%. However what the analysis in the Business plan reveals is that the project is sustainable over the long run despite a relatively small % age of the freight revenue being assigned to the DFCCIL in the form of Track Access Charges. Profit after Tax is forecast to be Rs 363 Crores in 2018 growing to Rs 572 Crores in 25 years. This reflects the efficiency that will be brought in by DFCCIL in Operations and Maintenance through increase in mechanization, reduced manpower norms, induction of new technology, systems etc. 3.6.8 The Dedicated Freight Corridor & The High Speed Railway Corridor –Some Common Objectives Both DFC and HSR Corridor proposals highlight the endeavour of IR to rapidly create rail transport capacity for both freight and passenger traffic, induct state of the art technology, improve quality of service and increase its market share in the transport sector. IR is already the fourth largest freight carrying railway system in the world transporting over a billion tonnes of originating freight traffic (1007 Million tonnes / 645 Billion NTKMs in 2012-13) and the largest passenger carrying system in the world transporting in terms of Passenger Kilometres (8640 Million Passengers / 1117 Billion Pass. Kms. in 2012-13). Although in the last 60 years or so there has not been very modest growth in route kilometres and various input indicators there has been very significant growth in output. This has been possible by periodical up- gradation of technology and adopting operational strategies to optimize asset utilisation. In the 61 years between 1950-51 and 2011-12 whereas the Index for growth of various inputs e.g. Route Kilometres increased from 100 to 121, Wagon Capacity from 100 to 311, Passenger Coaches from 100 to 356, Tractive Effort of Locomotives from 100 to 372 the actual Traffic Output grew from 100 to 1516 in terms of Net Tonne Kilometres and 100 to 1505 in terms of Non-Suburban Passenger Kilometres. This phenomenal growth in output against relatively modest investment based inputs could only be achieved by steady induction of new technology and adopting innovative operational strategies. However, a stage has been reached when incremental improvement may not be adequate and large investments in expanding capacity and inducting the latest technology have become essential to keep pace with the India’s anticipated economic growth. There is, therefore, a degree of similarity in the objectives that DFC and HSR Corridors as brought out in the following paragraphs. The two major developments that have taken place over the last half century or in railway transportation have been Heavy Haul / Long Haul Transportation in case of Freight Transport and HSR in case of passenger transportation. Both these areas require specialized technology and dedicated rail corridors. IR had missed out on these developments and is therefore keen to acquire and develop these technologies. In case of freight therefore a conscious decision has been taken to adopt the 25 tonne axle load with the potential to go up to 32.5 tonne in future and to introduce long haul operations by increasing train lengths to twice the present level and with trailing loads of 15000 tonnes. In case of Passenger transport speed is critical for competing with both air transport and road. IR last increased the Maximum Permissible speed of its trains to 130 km/h in the late 1960’s on the New Delhi to Howrah and New Delhi to Mumbai Central Routes for Rajdhani Express trains. Since then there has been a marginal increase speed to 150 km/h between New Delhi & Agra as a trial measure. There is therefore an urgent need being felt on Indian Railways to introduce higher speeds on the system in terms of Semi High Speed i.e. 160 to 200 km/h on existing corridors and new HSR Corridors with speeds between 300 to 350 km/h. During the last few years there has been growing concern for the environment. The World over a conscious effort is being made to reduce the emission of Green House Gases a major component of which is Carbon Dioxide. According to the International Energy Agency (CO2 Emissions from Fuel Combustion Highlights - 2013 Edition) India is the third largest contributor to CO2 emissions in the world behind China and the United States of America and emits more than 5% of global emissions. Emissions grew by about 3 times between 1990 and 2011. 52% of the emissions were contributed by the power generation sector. Against 3-91 Joint Feasibility Study for Mumbai-Ahmedabad High Speed Railway Corridor FINAL REPORT total emissions from fuel combustion of 1745.1 million tonnes of CO2 the share of Transport is 169.9 Million Tonnes or 9.73%. Out of 169.9 Million Tonnes contributed by the Transport Sector the share of the Road sector is 154.1 million tonnes or 90% of the total CO2 emissions of the Transport sector. The share of rail, shipping and aviation put together is therefore extremely small i.e. about 1% of the total CO2 emissions of the country. The Government, therefore, is extremely keen promoting railway development and Railways increasing their market share in both freight and passenger segments on environmental considerations. According to a ‘Green House Gas Emission Reduction Analysis for the DFC’ conducted by Ernst & Young there would be a saving of 457 million tonnes of CO2 emissions over 30 years. In case of HSR the UIC estimates CO2 emissions in case of HSR, 100 passenger kilometres generate 4 Kg of CO2, Cars 14 Kg and aeroplanes 17 Kg. With regards energy efficiency the passenger kilometres carried per Unit (1 Kwh) is 170 in case of HSR, 54 in case of bus, 39 for cars and 20 for aircraft. HSR benefits also accrue in terms of efficiency in land use and in imposing external costs on society. DFC experience of implementing two DFC projects also provides useful learning for the implementation of HSR Corridor once a decision is taken for implementation. This is applicable in case establishing new Standards for schedule of dimensions, construction standards for civil structures, signalling and telecommunication and overhead electrification as well as for rolling stock. There is also valuable experience in terms of land acquisition procedures, contract strategy, contract packaging and procurement procedures. A major area where HSR Corridor will need to differ from DFC is in its Business Plan Model. In case of DFC, IR shall be collecting the freight as per its tariff from the consignor and will only pay a relatively small component to DFCCIL as Track Access Charge. This is because traffic volumes will be very high from the beginning and will be based on IR tariff which is high by global standards. The margins in Passenger Business are much lower than in Freight, therefore, in case of HSR the Business Model will need to be different and various options for generating non rail based revenue may need to be explored such as development of office and shopping space at Railway Stations or real estate development in the vicinity of stations. REFERENCES Preliminary Engineering cum Traffic Study – Western Freight Corridor, RITES, January 2007 Preliminary Engineering cum Traffic Study – Eastern Freight Corridor, RITES, January 2007 Business Plan for DFCCIL, 2012 Draft Version XIV, Dedicated Freight Corridor Corporation of India Limited Data on DFCCIL Website Twelfth Five Year Plan (2012-2017), Volume II, Planning Commission 3-92 Joint Feasibility Study for Mumbai-Ahmedabad High Speed Railway Corridor FINAL REPORT 3.7 Plan for Semi High Speed Train on India Railways 3.7.1 The Quest for Speed Since time immemorial there has been an urge in all societies to improve mobility. This is why man progressed from a walking individual to taming animals for personal and goods transport, these included horses, donkeys, oxen and elephants. The invention of the ‘wheel’ came as a fundamental contribution to land transportation as it facilitated longer journeys in carts and carriages and subsequently facilitated railway systems and motorized transport. This along with water transport in boats and sail ships led to the spread of civilization to the far corners of the earth. The Industrial Revolution was based on utilizing the power of the steam engine. The development in the early nineteenth century of the Steam locomotive and the rolling of steel wheel on steel rail transformed surface transport for all time to come. Ever since then there has been an endeavour to constantly improve the speed of rail transport. For a major portion of the nineteenth and early twentieth century rail was the premier mode of transport.
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