In this September 24, 2014 filephoto, passengers get on the Shinkansen high-speed train at Tokyo station in Tokyo.(AP FILE)
In this September 24, 2014 filephoto, passengers get on the Shinkansen high-speed train at Tokyo station in Tokyo.(AP FILE)

Make in India in back seat, Japan has upper hand in bullet train deals: Report

Japan is funding most of the project, and Japanese companies are likely to supply at least 70% of the core components of the rail line, said five sources in New Delhi with direct knowledge of the matter.
By Neha Dasgupta, Rupam Jain and Yuka Obayashi | Reuters, New Delhi/Tokyo
UPDATED ON JAN 18, 2018 01:26 PM IST

Japanese steel and engineering companies are in the driver’s seat to bag major supply contracts for a $17 billion Indian bullet train, several sources said, undermining a key component of Prime Minister Narendra Modi’s economic policy — a push to ‘Make in India’.

Japan is funding most of the project, and Japanese companies are likely to supply at least 70% of the core components of the rail line, said five sources in New Delhi with direct knowledge of the matter.

A spokesman for Modi’s office declined comment.

A Japanese transport ministry official involved in the project said the two countries were still working out a strategy for the supply of key components, and would unveil a plan for procurements around July. The official spoke on condition of anonymity.

The September 2017 agreement between Japan and India for the bullet train project included two clauses — the promotion of ‘Make in India’ and ‘Transfer of Technology’ — through which New Delhi had hoped to set up manufacturing facilities in the country, generate jobs and get a toehold in Japanese technology.

Modi faces a general election in 2019 and is under pressure to provide more jobs to millions of unemployed in India. Critics also say the bullet train is wasteful and that the money could be better used elsewhere.

“The Japanese have reservations on certain issues because they have a concern that there is a difference in the culture and systems of Japan from the culture and systems in India,” said Achal Khare, the managing director of National High Speed Rail Corp Ltd (NHSRCL), the agency tasked to execute the bullet train project.

“The work culture is very different,” he told Reuters.

Khare did not elaborate but two Indian railways officials, who spoke on condition of anonymity, said their Japanese counterparts had raised questions about efficiency in Indian companies and their ability to meet timelines.

The World Bank currently ranks India 100th out of 190 nations on the ease of doing business, giving it relatively low marks for starting a business, enforcing contracts and dealing with construction permits.

Tomoyuki Nakano, director for international engineering affairs in the railway bureau at Japan’s transport ministry, said the issue was that Indian companies had no experience or technologies specialising in high-speed railway systems at present.

“I don’t think Japanese are concerned about a difference in the work culture,” Nakano said. He and other Japanese officials said efforts were continuing to fulfil the ‘Make in India’ component of the agreement by promoting collaborations between companies from the two countries.

Still, several Indian officials said it was by and large accepted that Indian companies would not have a major part to play in the bullet train project.

Japan will get major leeway because the bullet train is largely funded by a 50-year loan provided by its government, said a close aide of Modi, who spoke on condition of anonymity.

“At this stage to expect Indian companies to have a bigger share in manufacturing appears to be a little difficult,” said a senior official at the Indian government’s policy think-tank, NITI Aayog, who is involved in the negotiations.

Modi’s flagship ‘Make in India’ initiative aims to lift the share of manufacturing in India’s $2 trillion economy to 25 percent and create 100 million jobs by 2022.

However, midway through Modi’s five-year term, manufacturing was still at 17% of India’s GDP in the 2016/17 financial year from 15% previously.

Prime Minister Narendra Modi (R) and Japans Prime Minister Shinzo Abe pose in front of a Shinkansen bullet train before heading for Hyogo prefecture at Tokyo Station, Japan November 12, 2016, in this photo taken by Kyodo. (Kyodo/via REUTERS)
Prime Minister Narendra Modi (R) and Japans Prime Minister Shinzo Abe pose in front of a Shinkansen bullet train before heading for Hyogo prefecture at Tokyo Station, Japan November 12, 2016, in this photo taken by Kyodo. (Kyodo/via REUTERS)

Only one joint venture

Japan’s Prime Minister Shinzo Abe laid the foundation stone for India’s first bullet train in September last year. It will link Mumbai with Ahmedabad, the largest commercial city in Modi’s home state Gujarat.

Nippon Steel and Sumitomo Metal Corp , Japan’s biggest steelmaker, and other companies like JFE Holdings, Kawasaki Heavy Industries Ltd, Mitsubishi Heavy Industries Ltd, Toshiba Corp and Hitachi Ltd are likely to bid for various contracts, said three senior Indian government officials directly involved in the project.

Nippon Steel said it would not comment on specific projects.

JFE, Hitachi and Toshiba said they were interested in the project but had not finalised plans, including any possibilities of joint ventures with Indian firms.

Mitsubishi Heavy said it had not decided if it wanted to be involved.

The sole collaboration aimed at the bullet train project is between Kawasaki Heavy Industries and India’s Bharat Heavy Electricals Ltd , which aims to win carriage orders.

Japanese government officials have asked for more bullet train corridors in India before transferring technology, three senior Indian officials said.

But New Delhi is unlikely to announce any new projects until the final cost and commercial feasibility of the Mumbai-Ahmedabad link is clear, the officials said.

“It’s like a chicken and egg situation on technology. The Japanese want an economy of scale and business but the Indian view is that India is a big market that once this market is explored the business will automatically be generated,” said Khare from NHSRCL.

Missed opportunity

New Delhi has tried to help Indian steel companies grab a slice of the pie.

The Indian government last year mediated negotiations between Nippon Steel and India’s Jindal Steel and Power Ltd to set up a joint venture to manufacture rails, but the talks fell through after the Japanese major raised quality concerns, three sources in New Delhi said.

State-owned Steel Authority of India (SAIL), which for decades has been the main supplier of rails to Indian Railways, was also overlooked by Japanese companies due to quality concerns, the sources said.

Nippon Steel declined comment and while Jindal and SAIL did not reply to e-mails seeking comment.

Left with little choice, Indian firms will now largely provide raw materials like cement and supply manpower for the assembly of rails, the sources said.

India’s UltraTech Cement Ltd, Larsen & Toubro Ltd, Bharat Heavy Electricals Ltd and Ambuja Cements Ltd are among those in the race for the supply of construction materials and power, the two Indian railways officials said.

These companies did not respond to Reuters’ requests for comment.

SHARE THIS ARTICLE ON
Close
Analysts say that the F-16 incident may have well forced the Indian Air Force to acquire the Meteor missile for Rafale. (Vipin Kumar/HT Photo)
Analysts say that the F-16 incident may have well forced the Indian Air Force to acquire the Meteor missile for Rafale. (Vipin Kumar/HT Photo)

Pak went back on its F-16 promise to US. How India fixed the gaps with Rafale

By Shishir Gupta, New Delhi
PUBLISHED ON FEB 27, 2021 06:52 AM IST
Paris hasn’t just assured India that Rafale technology, specially that related to the Meteor air-to-air missile will be kept out of reach of Pakistan, but also that it will no longer upgrade the Mirage 3/5 fighters or Augusta 90 B submarines in Islamabad’s military inventory.
Close
In the absence of the US, the rest of the countries negotiated a new trade agreement called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership(Reuters File Photo )
In the absence of the US, the rest of the countries negotiated a new trade agreement called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership(Reuters File Photo )

US senator bats for including India in Trans-Pacific Partnership

PTI, Washington
PUBLISHED ON FEB 27, 2021 06:19 AM IST
The suggestion by Republican Senator John Cornyn came as the Joe Biden administration is looking to rejoin the TPP.
Close
Kejriwal, whose party had scored a zero in the state in the 2014 Lok Sabha elections, was visiting Gujarat for the first time in seven years.(PTI)
Kejriwal, whose party had scored a zero in the state in the 2014 Lok Sabha elections, was visiting Gujarat for the first time in seven years.(PTI)

In Surat, Delhi CM Kejriwal hails AAP’s poll performance

By Darshan Desai, Ahmedabad
PUBLISHED ON FEB 27, 2021 04:17 AM IST
In the recently concluded civic body polls, the AAP won 27 of 120 seats in the Surat Municipal Corporation in its debut appearance, thereby emerging the main opposition party against the Bharatiya Janata Party (BJP), which won 93 seats.
Close
On Friday, Azad arrived in Jammu on a three-day visit and was received by party workers.(ANI file photo)
On Friday, Azad arrived in Jammu on a three-day visit and was received by party workers.(ANI file photo)

23 Cong letter writers plan drive to ‘save idea of India’

By HT Correspondent, New Delhi, Jammu
PUBLISHED ON FEB 27, 2021 03:58 AM IST
The series of rallies and public meetings will kick off on Saturday in Jammu, where former Rajya Sabha member of Parliament Ghulam Nabi Azad, one of the 23, has invited his colleagues.
Close
External affairs ministry spokesperson Anurag Srivastava said there were selective leaks of the opinion of WGAD on Michel’s case.(Reuters )
External affairs ministry spokesperson Anurag Srivastava said there were selective leaks of the opinion of WGAD on Michel’s case.(Reuters )

India rejects United Nations panel report on Christian Michel

By Rezaul H Laskar, New Delhi
PUBLISHED ON FEB 27, 2021 03:55 AM IST
The United Nations Working Group on Arbitrary Detention (WGAD), which operates under the UN high commissioner for human rights, said that Michel, who has been held in India since December 2018 after being extradited from United Arab Emirates, should be immediately released, according to conclusions reported by AFP.
Close
“We cannot allow sexual harassment complaints to be brushed under the carpet this way,” a three-judge bench headed by Chief Justice of India S A Bobde said.
“We cannot allow sexual harassment complaints to be brushed under the carpet this way,” a three-judge bench headed by Chief Justice of India S A Bobde said.

Can’t ignore complaints of sexual harassment: Supreme Court

By Abraham Thomas, New Delhi
PUBLISHED ON FEB 27, 2021 02:51 AM IST
In her complaint in March 2018, the female judicial officer had accused the former principal district judge of Sheopur of sending lewd messages on WhatsApp.
Close
The bench emphasised that when the career and reputation of a spouse were severely damaged because of the conduct of the other partner, it could not be expected of the former to reconcile and agree to live together again.
The bench emphasised that when the career and reputation of a spouse were severely damaged because of the conduct of the other partner, it could not be expected of the former to reconcile and agree to live together again.

Harming reputation ground for divorce, says Supreme Court

By Utkarsh Anand, New Delhi
PUBLISHED ON FEB 27, 2021 02:48 AM IST
An SC bench, headed by justice Sanjay Kishan Kaul, held that such demeanour by a wife will certainly amount to inflicting cruelty on the man, and will be grounds for divorce under marital laws.
Close
To be sure, the Indian economy will still face its largest ever contraction in the current fiscal year.(AP file photo. Representative image)
To be sure, the Indian economy will still face its largest ever contraction in the current fiscal year.(AP file photo. Representative image)

India out of recession as GDP expands 0.4% in Q3

By Roshan Kishore, New Delhi
PUBLISHED ON FEB 27, 2021 02:43 AM IST
India’s gross domestic product (GDP) grew at 0.4% on a year-on-year basis in the quarter ending December 2020, according to data released by the National Statistical Office (NSO) on February 26.
Close
Jaishankar added that once disengagement is completed at all friction points, the two sides “could look at broader de-escalation of troops in the area”.(HT_PRINT)
Jaishankar added that once disengagement is completed at all friction points, the two sides “could look at broader de-escalation of troops in the area”.(HT_PRINT)

‘Peace on LAC must to mend ties’: Jaishankar tells Chinese counterpart

By Sutirtho Patranobis, Shishir Gupta, Rezaul H Laskar, Beijing, New Delhi
PUBLISHED ON FEB 27, 2021 02:39 AM IST
EAM Jaishankar’s blunt message was conveyed to his Chinese counterpart Wang Yi during a 75-minute phone conversation on Thursday — the first formal contact between the two ministers since they met on the margins of a Shanghai Cooperation Organisation (SCO) meeting in Moscow last September.
Close
According to experts, the liquor business in Delhi is shrouded in opacity and controlled by a handful of individuals or groups.(File photo. Representative image)
According to experts, the liquor business in Delhi is shrouded in opacity and controlled by a handful of individuals or groups.(File photo. Representative image)

Business of liquor needs a major detox

By Abhishek Dey, Sweta Goswami
UPDATED ON FEB 27, 2021 02:31 AM IST
In 2019-20, the city government pegged its revenue from the liquor business at 5,500 crore -- roughly 11% of its total revenue of 51,000 crore. Among major states, an HT analysis showed only in Karnataka and Telangana, liquor revenue formed a bigger percentage of the state’s revenue.
Close
Earlier in the state assembly, Tamil Nadu CM Palaniswami announced waiving gold loans up to six sovereigns taken from cooperative banks by the poor and farmers.
Earlier in the state assembly, Tamil Nadu CM Palaniswami announced waiving gold loans up to six sovereigns taken from cooperative banks by the poor and farmers.

Sops galore hours before poll schedule out

By Divya Chandrababu, Chennai, Kolkata
PUBLISHED ON FEB 27, 2021 02:10 AM IST
Most number of sops came from Tamil Nadu chief minister E Palaniswami, who is trying to beat 10 years of incumbency. The state assembly unanimously passed a bill providing 10.5% reservation for influential Vanniyar community within the existing quota of 20% for the Most Backward Classes (MBC).
Close
Arora said the nationwide vaccination drive made the situation more conducive to conduct elections.(PTI )
Arora said the nationwide vaccination drive made the situation more conducive to conduct elections.(PTI )

Crucial election cycle in 5 states to start on March 27

By Deeksha Bhardwaj, New Delhi
PUBLISHED ON FEB 27, 2021 01:39 AM IST
Votes in Assam, West Bengal, Tamil Nadu, Kerala and Puducherry will be counted on May 2, said chief election commissioner Sunil Arora. All Covid-19 election guidelines, including limiting the number of electors, regulating physical campaigning and road shows and sanitising booths and personnel, will be in place, he added.
Close
The states of Kerala, Tamil Nadu and Assam account for 13% out of the 543 seats in Lok Sabha.(File photo. Representative image)
The states of Kerala, Tamil Nadu and Assam account for 13% out of the 543 seats in Lok Sabha.(File photo. Representative image)

Five charts that explain the upcoming elections

By Abhishek Jha, Roshan Kishore
PUBLISHED ON FEB 27, 2021 01:22 AM IST
Three out of the four states going to polls; Assam, West Bengal and Kerala are also the top three states by share of Muslims in the population. With 26.7% Muslims and 16.6% Christians, Kerala has the lowest share of Hindus -- to be sure, they are still a majority – among India’s important states.
Close
Referring to some of the new acquisitions, experts said IAF’s fighter, helicopter and transport fleets played a crucial during the Ladakh standoff that began last May.(PTI file photo)
Referring to some of the new acquisitions, experts said IAF’s fighter, helicopter and transport fleets played a crucial during the Ladakh standoff that began last May.(PTI file photo)

IAF adds muscle to firepower in 2 yrs since Balakot

By Rahul Singh, New Delhi
UPDATED ON FEB 27, 2021 01:06 AM IST
Indian Air Force's (IAF’s) Mirage-2000s struck targets in Balakot in response to the Pakistan-backed Pulwama suicide attack in Kashmir in which 40 CRPF troopers were killed on February 14.
Close
Celeste goes on to add how, in a meeting with Pakistan PM Nawaz Sharif shortly after this, Clinton asked him to “withdraw troops” from Kargil.(ANI file photo. Representative image)
Celeste goes on to add how, in a meeting with Pakistan PM Nawaz Sharif shortly after this, Clinton asked him to “withdraw troops” from Kargil.(ANI file photo. Representative image)

When Pakistan failed to get support during Kargil

By Sunetra Choudhury, New Delhi
PUBLISHED ON FEB 27, 2021 12:54 AM IST
In a new book, Life in American Politics & Diplomatic Years in India published by Har-Anand Publications, Richard Celeste, the US ambassador to India between 1997 and 2001, reports a visit he received from Pakistan’s Ambassador to India, Ashraf Qazi.
Close
SHARE
Story Saved
OPEN APP