New Delhi: Indian Railways ruled out renegotiation of its terms and conditions with the Japanese agency, amid the growing concerns or cost escalation in Mumbai-Ahmedabad bullet train.
The high-speed railway network is being estimated of a cost of Rs 1.1 lakh crore, which includes the purchasing of 24 train sets, interest during construction and import duties. The Japanese International Cooperation Agency (JICA) is funding 81 percent of the total project cost by a loan.
Chairman Railway Board Vinod Kumar Yadav accepted that there will be a rise in cost of the bullet train project but mentioned that there won't be any renegotiation on the loan.
He said, "There is a cost escalation, but this is not the right time to review cost. That will be done after we finalize the tenders as we only finalize the estimated cost on the basis of historic cost. But the actual cost can be known only when tenders are invited. That is the time when we come to know what the project cost is shaping up."
He further added, "As far as cost escalation is concerned, in any project whatever the estimated cost may be, when the work is being executed, there is bound to be some increase in the cost either due to inflation or due to change in design."
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Yadav mentioned that 60 percent of the land has been acquired for the project in which 77 percent is of Gujarat, 80 percent of Dadar Nagar Haveli and 22 percent of Maharastra. The deadline for the project has been set for December 2023.
The Railway official informed that the land acquisition process faced some delay due to COVID-19 pandemic and by this financial year, the process is expected to be completed. The physical work will begin after 90 percent of the land has been acquired.
Last week, the Union Railway Minister Piyush Goyal also indicated that the financial aspect of bullet train project was being reviewed as a post COVID world will entail "a lot of tightening of belt".
