After signing several important contracts, India hopes to complete the two freight corridors by 2019 to ease traffic on the other lines and to increase the market share of railway transport. Construction works are underway and new contracts will be signed over the next period to complete the projects in due time. Next to these projects, the new development strategy of the railway freight system relies on the construction of new corridors, some of which have already been announced.
The projects of the two corridors (East and West) include the construction of the freight transport dedicated lines in the west providing connection between Delhi and Mumbai and between Ludhiana and Howrah, via Delhi. They will actually provide connection between Delhi and Kolkata. Projects have a total cost of USD 12 billion. The West Corridor will be financed by JICA, while the East Corridor, the Mughalsarai – Ludhiana section, by the World Bank. For EDFC, the World Bank has granted the first credit worth USD 975 million since 2011 and in June 2015, the Bank approved a loan of USD 650 million. According to the Ministry of Railways, the WB is financing the corridor with an overall USD 2.72 billion. For WDFC, JICA has provided loans worth USD 842 million. The agreement between the two parties refers to a total USD 5.5 billion grant.
At the end of March, JICA announced the conclusion of a new agreement with India to grant a loan of JPY 103 million (around USD 1 million) for phase 3 of the project. “This loan will help coping with the huge and rapid increase of freight transport demand in India by constructing a new dedicated freight railway system. It will help promote comprehensive regional economic development along the freight corridor, DMIC, through improvement and modernisation of inter-modal logistic system handling considerable freight traffic,” Takema Sakamoto, Chief Representative, JICA India Office said.
7 contracts were signed for civil engineering, electrification and S&T last year as part of the two projects. The contracts were estimated at around USD 2.6 billion, much more than the total contracts signed over the past 6 years (around USD 1.8 billion). The DFCCIL report shows that, in January, civil and infrastructure works were 65% completed on a total length of 1830 km, while works to systems were 50% completed on a total length of 1360 km. In the first part of the year, new civil engineering, infrastructure, electrification and signalling contracts are expected to be signed for 85% of the total length of the lines.
In January 2016, the pre-qualification call was launched for the design, supply, installation, testing and finalisation of electrification and signalling works for the Sahnewal –Pilkhani section (175 km of simple line) on the Eastern Corridor. The call for bids will be launched in July. The project has been applied by the Ministry for financing through loan from the Bank for Reconstruction and Development as part of the Eastern Dedicated Freight Project-3. Also in January, the consortium including de Larson & Toubro (India) and Sojitz Corporation (Japan) won the USD 179 billion contract for the electrification of 422 km of line part of the Western corridor on the Gujrat – Jawaharlal Nehru Port section near Mumbai. The two companies will build 7 electrical substations, 897 km of catenary, 40 converter stations and will provide works for the construction of a control centre and Scada works for 12 stations.
In November 2014, Larsen and Toubro won another contract worth USD 424 million for the electrification of 915 km of the Western Corridor. Also, the company is involved in the construction of 626 km of double line from Rewari in Haryana to Iqbalgarh in Gujarat, in Rajasthan (Western Corridor).
Works to the two corridors will be completed in 2019 which will encourage the shift of freight to railways and, obviously, the increase of freight traffic between Delhi-Mumbai and Delhi-Kolkata. “In two years from 2019, traffic on these two corridors is estimated to reach 305 million tonnes, more than one-fourth of what the railways are estimated to carry in the current fiscal year,” Railway Minister Suresh Prabhu said.
Three new corridors
And India does not stop here. The Indian railway network is the fourth longest railway network in the world (64,600 km) and India transports 3 million tonnes of freight and 23 million passengers a day. In 2014-2015, Indian Railways reported a freight traffic of over 1 billion to/km. As freight volumes are expected to grow, freight-dedicated corridors become development objectives in India. Thus, as part of the 2016-2017 budget, the authorities expressed their intention to build another three freight corridors, projects to be implemented through public-private partnerships. “Shifting of goods trains from existing tracks to the new corridors would also release a great deal of capacity which would help upscale the nature of passenger services on these trunk routes. It is proposed to prepare a blueprint for making full use of this huge new capacity no sooner than it is commissioned,” Prabhu said.
The three corridors in plan focus on the north-south, between Delhi and Chennai, east-west with connections between Kharagpur and Mumbai and the East coast, between Kharagpur and Vijayawada. The projects are a priority and will be implemented in conformity with the programmes set through “innovative financing mechanisms”. The cost of the three projects is estimated at over USD 50 billion. According to the declarations of Minister Prabhu, civil engineering contracts will be announced before the end of the fiscal year.
by Pamela Luica
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