Ahmedabad-Mumbai bullet train project hits hurdle as Railways and Maharashtra spar over land acquisition cost

India’s ambitious bullet train project from Ahmedabad to Mumbai has run into snags. Sources told CNBC-TV18 that several key tenders for the Mumbai-Ahmedabad High-Speed Rail (MAHSR) corridor are yet to take off.

Sources said 67 percent of the land required in Maharashtra for the bullet train project has been acquired. However, "the crucial land parcel needed for BKC-Thane stretch could be the deciding factor for the fate of bullet train project in Maharashtra," they said.

The bullet train in India or the National High-Speed corridor will run between Ahmedabad and Mumbai. The train is expected to have 12 stops including Mumbai, Thane, Virar, Boisar, Vapi, Bilimora, Surat, Bharuch, Vadodara, Anand, Ahmedabad, and Sabarmati. Nearly 91 percent of the stretch of the entire route is likely to be elevated.

The work on the bullet train project between Ahmedabad and Mumbai was initiated in September 2017. The project was initially planned for completion by December 2023. The government had announced that efforts would be made to complete the project by August 2022, however, the timeline has seen multiple extensions over the past five years.

"As far as Maharashtra is concerned, if the stalemate continues, the route of the bullet train will have to be reworked as a bullet train in Maharashtra without the BKC-Thane stretch is unlikely to see much demand," the sources told CNBC-TV18.

They said the timeline for completion of the bullet train project may now get extended to 2030.

"In Gujarat, the civil work and awarding of tenders have been done. Pillar work on Bilimora-Surat stretch of 61 km is complete and work has also started for Surat terminal building," officials said.

"Ahmedabad terminal hub is expected to be completed by next two to three months," some officials said. As a result, the trial run of the bullet train on 49-km Bilimora-Surat stretch is likely to be extended to 2026-27.

The bullet train project has been estimated at over Rs 1 lakh crore. Of this, 81 percent of the project cost is via a Japanese soft loan.

As part of a cooperation agreement between India and Japan, the government of Japan was to provide a soft loan of about Rs 88,000 crore at an interest rate of 0.1 percent. The repayment period of the loan is 50 years. Repayment of the loan is to begin after 15 years of receiving the loan.