Japanese steel and engineering companies are on the number one spot in the list among the gainers that will gain the most from India's ambitious bullet train project.
Japanese steel and engineering companies are on the number one spot in the list among the gainers that will gain the most from India's ambitious bullet train project.
According to various media reports citing different sources, one thing that came in the highlight is that japanese firms are ahead in the race to grab major supply contracts for a $17 billion Indian bullet train 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 per cent of the core components of the rail line, said five sources in New Delhi with direct knowledge of the matter.
A spokesman for PM 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.
PM 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.
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 PM Modi's home state Gujarat.
Nippon Steel and Sumitomo Metal Corp, Japan's biggest steelmaker, and other companies like JFE Holdings Inc, Kawasaki Heavy Industries Ltd, Mitsubishi Heavy Industries Ltd, Toshiba Corp and Hitachi Ltd are likely to bid for various contracts, said three senior 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 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.
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