Report February 2019
Total Page:16
File Type:pdf, Size:1020Kb
FY2018 Study on business opportunity of High-quality Infrastructure to Overseas (India: Feasibility Study of Rail Transportation Technologies for Completed Vehicles That Contribute to Operation in India by Japanese Corporations) Report February 2019 Konoike Transport Co., Ltd. Japan Freight Railway Company Table of Contents Table of Abbreviations ................................................................................................................................................. 2 (1) Examination of benefits to India from the transportation of completed vehicles .................................................. 3 a. Envisioned state of transportation of completed vehicles and its effects ............................................................. 3 b. Study of potential for Japanese corporations to establish operations in the vicinity of the DFC ........................ 4 (2) Trends in Indian government policies and measures regarding completed vehicle transportation ........................ 5 a. Trends in related policies and measures by counterpart national government, etc. ............................................. 5 Policies and measures in India ............................................................................................................................. 5 Policies and measures of the Indian Ministry of Railways .................................................................................. 7 Policies and measures by state ............................................................................................................................. 8 b. Study of the legal framework and related matters concerning completed vehicle transportation ..................... 12 (3) Collection and analysis of information and formulation of hypotheses for the purpose of constructing a completed vehicle transportation network .................................................................................................................................. 18 a. Ascertaining the actual status of infrastructure relating to completed vehicle transportation in India (status of improvement and progress) ................................................................................................................................... 18 b. Ascertaining the needs and issues involved in completed vehicle transportation for concerned parties in India 20 c. Study of market scale and demand relating to completed vehicle transportation .............................................. 22 (4) Study, demonstration, and validation of technical aspects ................................................................................... 24 a. Data collection and validation concerning issues involved in operating freight trains of completed vehicles. 24 b. Confirmation of the effects of rail transport technologies for completed vehicles in India ............................... 26 c. Survey of Necessities for the Development of Cargo Collection and Distribution Networks around the DFC (including development trends, etc. for MMLHs scheduled for development around the DFC) .......................... 42 d. Study of the Development Schedule for Related Infrastructure (including usage conditions, connectivity, etc.) ............................................................................................................................................................................... 46 (5) Calculation of project scale, etc., and study and proposal concerning financing ................................................. 47 a. Calculation of project scale, etc. (including operation, servicing, and maintenance costs) ............................... 47 b. Study and proposal concerning financing .......................................................................................................... 49 Pattern of Japanese-affiliated companies expanding into India ......................................................................... 49 Study of financing methods ............................................................................................................................... 51 a. Use of policy support, etc. potential for lateral extension to other countries, etc. and measures to promote extension ................................................................................................................................................................ 58 b. Analysis of the superiority of Japanese companies (where necessary, moves by competing companies, and competitive advantages in comparison with them), prediction of benefits for Japan (economic effects) ............. 59 c. Response to Demands and Points Raised by Interested Parties in India ............................................................ 60 e. Validation of Energy Source CO2 Reduction Effects ......................................................................................... 62 1 Table of Abbreviations Abbreviation Official Name AFTO Automobile Freight Train Operator CMVR Central Motor Vehicles Rules CTO Container Train Operator DFC Dedicated Freight Corridor DFCCIL Dedicated Freight Corridor Corporation of India Ltd. DMIC Delhi Mumbai Industrial Corridor DMICDC Delhi Mumbai Industrial Corridor Development Corporation Limited ECB External Commercial Borrowing EPC Engineering, Procurement and Construction GREEN Global action for Reconciling Economic growth and ENvironmental preservation GST Goods and Service Tax GVW Gross Vehicle Weight HQ Container High Cube Container ICD Inland Container Depot IR Indian Railway JBIC Japan Bank for International Cooperation JOIN Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development MCLR Marginal Cost of Funds based Lending Rate MMLH Multi Modal Logistics Hub MOR Ministry of Railway NEDO New Energy and Industrial Technology Development Organization PPP Public Private Partnership RBI Reserve Bank of India ROC Registrar of Companies RDSO Research Design and Standards Organization 2 (1) Examination of benefits to India from the transportation of completed vehicles a. Envisioned state of transportation of completed vehicles and its effects The Indian economy is growing at the rate of around 7%. By the year 2030, the urban population of India is expected to grow approximately 40% relative to 2014, and the number of cities with a population exceeding one million will reach eighty-seven. Economic activity in the cities makes up the greater part of India’s GDP, and this is estimated to expand to as much as 70% by 2030. As it achieves this kind of growth, India is attracting attention as a promising place to invest. As urbanization progresses, however, traffic congestion, traffic accidents, and environmental pollution have become serious issues. The increase in freight transportation volume that resulted from rapid economic growth in India has been accompanied by Indian government actions to formulate plans (10th and 11th Five-Year Plans) relating to improvement of the Dedicated Freight Corridor (referred to below as “DFC”) as well as to promote infrastructure improvement. The government has also engaged in construction of the Dedicated Freight Corridor, among other activities. In this context, regulations governing the heavy-duty trucks used for completed vehicle transportation in India have been tightened. The allowable length of such trucks has been reduced from 22 m to 18.75 m, and the number of completed vehicles that can be loaded onto one truck has also been reduced. While this regulatory tightening was underway, the unit sales volume of new completed vehicles in India in 2017 surpassed the figure for Germany to reach fourth place in the world. Unit sales volume of new automobiles is expected to continue, steadily increasing into the future. (See Figure 1) This reduction in the number of completed vehicles that can be loaded at one time on these heavy-duty trucks due to regulatory tightening occurs in combination with the increase in unit sales volume (increase in production volume) of automobiles within India. Consequently, there are concerns about a shortage of trucks for transporting completed vehicles from production plants and so on to the locations where there is demand for those products. Automobile Freight Train Operators (referred to below as "AFTO”), which use specialized freight cars for rail transportation of these completed vehicles, were freed to participate in the commercial market in 2013. This was in part because of the idea that it will not be possible to transport those products unless rail freight transportation is expanded. A large part of this transportation, whether by truck or by rail, is one-way (from production plants to consumption locations). As matters stand at present, almost no return transportation of automobiles takes place. In the case of AFTO operation of rail freight transportation, return freight is limited to motorcycle and automobile parts. If it is made possible to load goods other than motorcycle and automobile parts, however, then it will be possible to build efficient rail transportation. At the same time that raising the efficiency of transportation of fully assembled automobiles becomes an urgent issue for commercial enterprises and other concerned parties, the matter of improving transportation quality in terms of damage to freight and so on is also becoming an issue. Therefore high-quality service is coming to be sought in conjunction with improved efficiency. 3 (Unit: Vehicle) 5,177,000 4,894,277 4,630,347 4,380,650 4,144,418