Estimation of price-demand relationship for Bullet Train Project in India

Abstract

India has proliferated over the last two decades economically as well as demographically, but the infrastructure growth has not kept pace. Though India has invested heavily for upgrading the same, the demand has outstripped the pace of project development. There has been an increasing freight traffic kilometres and passenger traffic kilometres delivered by Indian railways over the years. These numbers have seen a significant growth especially in the non-suburban category indicating that intercity commute is on the rise. Besides the rail commute, the vehicle kilometres have also grown from 120The quest of development requires not just increase in reach of existing offerings, but also to renovate and upgrade to latest technology across the World to enhance economy’s productivity. Indian railways play a significant role in providing A-B connectivity for passengers as well as freight. In the backdrop of the rising demand, The Indian Railways is progressing with “Dedicated Freight Corridors” for freight transport and “Indian Railways Vision 2020” for passenger commute. Indian Railways Vision 2020 aims at expanding the reach, both socially as well as geographically, with the aim of increasing its Gross revenue from 1.2% of Indian GDP to 3% through Network Expansion, capacity creation, reinventing passenger services and facilitating High-Speed Rail travel. Indian railway had launched Duranto services in the past that are non-stop trains run to reduce the commute time. Also, under the Vision 2020, IR aims at improving the speed of regular passenger trains to 160-200 kmph on segregated routes. The Vision 2020 also envisages the implementation of, one in each of the regions of the nation and planning for at least eight more corridors connecting commercial, tourist and pilgrimage hubs. These corridors are defined as High-Speed Rail (HSR) Corridors specifically designed for trains with speeds 250 kmph and above. Currently, 22 countries worldwide are running HSR with China constituting 2/3rd of the total operational HSR1.