Project Train : Indian Railway Infrastructure & Urban Transportation Opportunities

Transcription

1 Project Train : Indian Railway Infrastructure & Urban Transportation Opportunities November 2015 Market Entry Partnerships Growth

2 India & Current Infrastructure Overview 12 th 5 year Plan & Infrastructure Budget Opportunity 1 : Urban Rail Transportation (MRTS) Opportunity 2 : Dedicated Rail Freight Transportation Opportunity 3 : Passenger Railways Targeting Opportunity & JV Roles & Responsibilities

3 The Republic of India An Overview Demographic Profile Population: 1.2 billion Population Growth Rate: 1.28 %(2013 est.) Religions: Hinduism, Islam, Christianity, Sikhism, Buddhism, Jainism Languages: 18 Official Languages Literacy: Total population: per cent (2011 census) Demographics: 0-14 years 30% 15-64years 65% 65 and above 5% Sex ratio: 933 female per 1000 male New Delhi Kolkata Mumbai Chennai Political Profile Political System: Democracy (Largest) Form of Government: Federal parliamentary democratic republic Legal System: Common law Head Of State: President Head Of Government: Prime Minister Administrative Divisions: 28 States and 7 Union Territories Land : 3.3 million sq km Water: 314,070 sq km Coastline: 7510 km Geographical Profile Natural Resources: Coal (4 th largest reserves in the world), iron ore, manganese, bauxite, and chromium 7th Largest Country with 1/6 th of the World Population 3

4 Current Infrastructure Status Installed Power Generation Capacity (GW) th largest installed power capacity Rail Lines; Total route (Km) 64,600 3 rd largest rail network Roads; Total Network (Km) 3,790,344 2 nd largest road network Air Transport, passengers carries 73,173,381 8 th largest air transport, passengers Container port traffic (TEU: 20 ft. equivalent units) 9,983, th largest container port traffic Yet. Infrastructure Deficit kwh consumption per capita Roads (Km) per mil. pop. Port Traffic per '000 pop. Air pass. per '000 pop. 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, ,384 2, India China Italy 13,394 USA 25,000 20,000 15,000 10,000 5, ,158 8,063 3,053 2,996 India China Italy USA India China Italy USA 2,500 2,000 1,500 1, , India China Italy USA Currency Conversion Euro 1 = USD 1.33 = INR 80 4

6 Better Infrastructure Required To Sustain Growth Demand for Infrastructure Economic Factors - GDP growth - Rising disposable income Demographic Factors - Rising population - Increasing urbanization Global Integration - Rising international trade and travel Roads Power Rail Metro Airports Ports Increased expectation of quality services & willingness /capability to pay for them: Road Tolls, Reliable Electricity, Improved Logistical Efficiency, Urban Transportation Charges, Airport Fees, Cargo Handling Charges Infrastructure Spending Percentage of GDP (USD Billion) 12 th Year Plan 12th ~ USD 1 Trillion 8.18% th Year Plan th USD 433 Billion 7.21% 10th USD 149 Billion 5.04% FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 With private sector investing about USD 500 billion, the investment in infrastructure is estimated to double to about USD 1 trillion during the 12th plan ( ) compared to the previous plan 6

7 Infrastructure Spending : 12 th Plan ( ) Sector Investment Some physical target Power (Electricity and Renewable Energy) USD bn - Additional power generation capacity of about 88,000 MW - Provide electricity to all villages and reduce AT&C losses to 20 per cent - Add 30,000 MW of renewable energy capacity Roads and Bridges Telecommunication USD bn USD bn - Developing 18,637 Km of expressways - Connect all villages with all-weather roads - Upgrade national and state highways to the minimum two-lane standard - Achieving a subscriber base of 1200 million connections from current level of 780 million - Increase rural tele-density to 70 per cent Irrigation (incl. Watershed) Water Supply and Sanitation Ports (+ILW) Airports USD bn USD bn USD bn USD bn - Increase the Gross Irrigated Area from 90 million hectare to 103 million hectare - Ensure 50 per cent of rural population has access to 40 lpcd piped drinking water supply - Capacity addition of 485 million MT in major ports, 345 million MT in minor ports - Modernization and redevelopment of ~35 existing non-metro airports - Construction of 7 Greenfield airports Oil and Gas Pipeline USD bn Storage USD 9.74 bn - Creation 2MMT of modern storage facilities in the form of silos Railways and MRTS USD bn - Upgrade 200 freight terminals and add 50 new goods shed facilities - Complete Eastern and Western Dedicated Freight Corridors Railways and MRTS detailed spending ($ bn) Total 12th Plan Railways $ $ $ $ $ $ MRTS (Mass Rapid Transit System) $ 2.26 $ 2.86 $ 3.72 $ 4.97 $ 6.89 $

9 Indian Cities: Population growth Indian Cities: Status Overview Population has increased rapidly in major cities of India in the last decade, above the national average of 1.63% As per the 2011 census of India, 53 urban agglomerations in India have a population of more than one million, with Delhi, Greater Mumbai, Kolkata, Chennai and Bengaluru having the largest population The population growth of the cities is not expected to slow down in the coming decade given employment opportunities and migration There are 160 mn people living in these 53 urban agglomerations (2011) In the next two decades, with continued migration and internal population growth, the number of million plus population Urban agglomerations is expected to increase to 65 (215 mn population) by 2021 and to 70 (277 mn population) by 2031 No. of urban agglomerations having million plus population 53 (2011) (2021) 70 (2031) Million plus urban agglomeration population to increase 160 (2011) (2021) 277 (2031) Increasing urban population and rising incomes has led to

10 Growth in Number of Vehicles With the increase in population and rising incomes there has been a rapid growth in the number of vehicles. However, the pace of road network expansion has been slow and the state of public transportation is poor, leading to a host of problems Number of vehicles has more than doubled in last 10 years Vehicular Growth In Cities ( ) 300% 246% 250% 216% 184% 200% 178% 176% 174% 169% 169% 150% 100% 50% 0% Vehicles Vs Road Network Number of Vehicles in 2014 (million) More than a million vehicles in most urban cities Road length growth (%) Vehicles growth (%) Leading to traffic congestion, high road accidents and pollution

11 Solution To The Problem: Mass Transit System More than a million vehicles in most of the leading developed cities in India With most of the developed cities having concentrated economic activity centers it becomes difficult for traditional means of transport to support the rising traffic Most of the major cities of the world have built mass rapid transport systems, with underground metro rails being the most popular Most developed cities of the world are densely populated and in almost all of them, mass railway transit is the primary mode of intra-city travel. In addition, most of them have high population density Large population and high economic activity are the two main drivers for intra-city traffic Mass Transit System: Rail based MRTS Extensive network of metros in the most urban cities Shanghai Beijing London New York Seoul Moscow Tokyo Madrid Guangzhou Paris Most cities across the world with high economic activity and population have a strong mass rail transit system network Most of Indian cities with highest population density do not have a Metro currently

12 MRTS Project Opportunities: Status & Plans City State Population (mn) Delhi Delhi 16.3 Greater Mumbai Maharashtra 18.4 Kolkata West Bengal 14.1 Chennai Tamil Nadu 8.7 Bangalore Karnataka 8.5 Hyderabad Andhra Pradesh 7.7 Ahmedabad Gujarat 6.2 Metro / Local Rail Phase 1 completed: 65km Phase 2 completed: 125km Phase 3 under construction: 136km Mumbai: km planned. 11km completed Navi Mumbai metro rail project: initial stages Operational 28km 90km under implementation or plans Initial stages of construction: 2 initial corridors of 23km and 22km Total length of 42.3km with two lines of 18.1km and 24.2km respectively under implementation Under construction: 3 corridors covering total distance of 72km Initial stages, work yet to start. Proposed 83km with 19km underground Total length (km) Length/Mn population Pune Maharashtra 5.0 Initial stages, two routes of 16.6km and 14.9km 32 6 Surat Gujarat 4.6 Announced, DPR yet to be submitted Jaipur Rajasthan 3.1 Under implementation with phase 1 having length 12.1km and phase 2 having length 32km Kanpur Uttar Pradesh 2.9 Lucknow Uttar Pradesh 2.9 Work yet to start: 2 phases, entire phase 1 expected to be 36km Nagpur Maharashtra 2.6 Planned: 42km to be implemented trough two lines. Central govt approval yet to be received Indore Madhya Planned: DPR yet to be submitted. Total length of 2.2 Pradesh 32km Coimbatore Tamil Nadu 2.2 Kochi Kerala 2.1 Under construction single line 25.6km project Patna Bihar 2.0 Work yet to start. Four corridors, total length of 60km Kozhikode Kerala 2.0 Announced: Work yet to start, 32.6km length 33 16

14 Indian Railways: Freight Overview Indian Railways A Government of India Enterprise Total route network of: 64,600 Km (29.98% is multi-track) Number of Stations: 7,146 Number of trains per day:19,000 trains Wagons: 239,321 Coaches: 61,899 Locomotives: 9,549 Total assets (FY12) : USD61.7 billion Revenues 29.40% 70.60% Passenger Freight Freight Around 1000 million tonnes of freight was transported via trains in FY14 Variety of goods like mineral ores, iron and steel, fertilizers, petrochemicals, and agricultural produce Freight remains the major revenue earning segment, accounting for 70.6% of total revenues in FY14 Profits from this segment are used to crosssubsidize the passenger segment Railways accounted for 31% of India s freight traffic Freight traffic is expected to expand at a CAGR of 6.6% to 1.4 billion tonnes by FY17 from 745 million tonnes in FY07 Freight traffic reached 1000 million tonnes in FY14, a 5.3% rise over the previous fiscal year The figure has grown at a CAGR of 5.5% over FY07 12 and is expected to grow at a CAGR of 7.6% during FY12 17

15 Need for Dedicated Freight Corridor Railway Freight Transpotation Issues The rapid growth of Indian economy has led to high capacity utilisation of the railway corridors resulting in congestion and as the result the container movement shifting to roads Cost of carriage by Road is (approx.) Rs.1.20/ TKm as compared to Rs.0.60/TKm by Railways Presently Delhi-Mumbai distance (by railways) of 1,340 Km is covered in 47 hours at an average speed of 28.5 kmph The congestion on this corridor is slated to increase with container traffic growing at CAGR of 16% Over 150% Capacity Utilization on Western Routes Additional Container Handling Berths at Ports and major ICDs in North India expected to generate huge volumes of railway freight traffic Railway Freight Transpotation Solution: DEDICATED FREIGHT CORRIDOR (DFC) This burgeoning demand led to the conception of the dedicated freight corridors along the Eastern and Western routes. The Dedicated Freight Corridor Corporation of India Limited (DFCCIL) is a corporation designated by Government of India as a `special purpose vehicle`, and has been created to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. Additional Double Line Dedicated Freight Corridor shall facilitate phenomenal growth in freight traffic Reduction in the Unit Cost of Transportation by introducing Heavy Axle Load & Double Stack container trains

16 Objectives & Design Features of DFC Create rail infrastructure to carry high levels of freight Reduction in unit cost of transportation & inventory costs Achieving greater customer satisfaction and increase railway s share in freight market Speed up freight train operations, achieve higher productivity through better utilization of railway assets Introduction of high end technology in freight operations Increase throughput by higher axle loads, moving dimensions, track loading density, improved pay load/tare ratio Relieving existing rail corridor, decongesting busy terminals & junction stations thereby improving safety in passenger train operations Features Existing DFC Moving Dimensions Objective Height m Width Container Stack Train Length Single Stack double Stack Train Load

17 Design Features of DFC & Project Features Features Existing DFC Heavier Axle Load Axle Load 22.9T/25T 32.5T/25T for track superstructure Track Loading Density 8.67 T/m 12 T/m Maximum Speed 75 Kmph Single Stack 100 Kmph Double Stack Grade Up to 1 in in 200 Curvature Up to 10 degree Up to 2.4 degree Traction Electric (25 KV) Electric (2x25 KV) Station Spacing 7-10 Km 40 Km Signaling Absolute/Automatic with 1 Km Spacing Automatic with 2 Km Spacing Communication Emergency Sockets/Mobile Train Radio Mobile Train Radio Route Description Features Western DFC Eastern DFC JNPT-Ahmedabad Palanpur Phulera Rewari Tughlakabad - Dadri Route Kilometer 1,483 1,839 Dankuni-Sonnagar-Mughalsarai Allahabad Khurja Ludhiana- Dadri No of lines Double (Single-TKD-Pirthala) Double (Single KRJ-LDH) Standards of Construction 60 Kg., 90 UTS rails, PSC 1660 per km, 300 MM ballast cushion,1500m loops Maximum Speed 100 Kmph 100 Kmph Land requirement 5320 hectares 3600 hectares Feeder Routes 1379 Km 2841 Km

19 Indian Railways: Passenger Overview Indian Railways A Government of India Enterprise Total route network of: 64,600 Km (29.98% is multi-track) Number of Stations: 7,146 Number of trains per day:19,000 trains Wagons: 239,321 Coaches: 61,899 Locomotives: 9,549 Total assets (FY12) : USD61.7 billion Passenger 12,335 passenger trains were in operation in FY million passengers travel by trains on a daily basis in India In the past decade, just one of 99 new rail line projects announced has been completed and 359 projects out of 676 projects approved in the last 30 years are still pending with their costs doubling. IR needs ~ USD 30 bn to complete all the pending projects and a total of USD 83 bn over next 10 years to complete all the existing projects Passenger Volumes (in billion) FY07 FY12 FY17F CAGR (FY07-12) CAGR (FY12-17) % 8.3 % Budget Allocation in Railways during the 12 th Five Year Plan (USD bn) Railways Total 12 Plan $ $ $ $ $ $ 86.54

20 Need for revamping and Expansion Highlights from Budget Challenges Vast tracts of hinterland waiting for rail connectivity Focus so far in sanctioning more and more projects with inadequate prioritization Railways carry Social Service Obligation of approx. 16.6% ( 2.5 Bl) of Gross Traffic Receipts Course Correction Initiatives Focus on doubling and tripling to decongest the over-utilized network Maintaining sensitivity to social obligations, gradually hike fares and tariffs Strategic partnerships and transparency in procurements Alternate resource mobilization need to be explored o Leveraging Railway PSU Resources by bringing in their investible surplus funds in infrastructure projects of Railways. o Domestic investments and FDI in rail infrastructure o Pursuing Public Private Partnership. Improve passenger amenities / services & station management Implement measures for improving safety & security Structural reforms for policy formulation and implementation Bullet train proposed on identified Mumbai-Ahemdabad sector Setting up of Diamond Quadrilateral Network of High Speed Rail connecting major metros and growth centers of the countryppp through BOT and Annuity route and identification of 8 to 10 capacity augmentation projects on congested routes

22 PPP Process Rail/MRTS Transport PPP Project Identification Feasibility, Preparation and Clearance Procurement, Final Approval and Award Contract Management and Monitoring Strategic Planning for a set of projects Set of Potential Projects Selected Individual Project Reviewing Plans for PPP Project Management Full Feasibility Study and PPP due Diligence Feasibility Study Report Preparing for procurement: - Issue EOI/RFQ - Shortlist Bidders Final Drafts of Key Bidding Documents Final Approval Preparation for Contract Management - Institutional Set up (Team, Manual, Budget..) Assigning a PPP Project Management Team Project Prefeasibility analysis PPP Suitability Checks Best Practises Suited For Procurement Process First Draft of Bid Documents (Concession Agreement, EOI, RFQ) Tendering Evaluation: - RFP distribution & Bid Preparation - Evaluation Criteria - Bid Evaluation EPC Contract(s) / sub- Contract(s): 1) Pre-operative Stage 2) Construction Stage 3) Operation Stage 4)Contract Closure and Asset Transfer Stage Pre-feasibility Report In-principle clearance Contract Finalisation and Award

23 EPC Project Activities & Responsibilities Activities Primary Responsibility Secondary Responsibility Project Identification & Bidding Project Identification Indian Partner Bidding RFQ/RFP Indian Partner International Partner Clarification & Negotiation Joint Responsibility Contract Awarding & Signing Indian Partner International Partner Project Planning & Preparation Phase Project feasibility study and Define Scopes Joint Responsibility Government/Regulatory Approval Indian Partner Funding Indian Partner Budgeting Indian Partner International Partner Project Definition Phase Technology/License Selection International Partner Indian Partner PMC/Engineer Selection International Partner Indian Partner Basic Design/Process Design International Partner Indian Partner Project Implementation Phase Local Procurement Indian Partner Construction Expertise Indian Partner Value Engineering International Partner Cost optimization & Construction technology International Partner Pre-commissioning & Commissioning Indian Partner International Partner

24 Expertise Expectation From Each Partner Indian Partner Local Knowledge and Sourcing (goods and services) Stakeholders Management Construction Experience and Lower Costs Relationships with Authorities and Prime Contractors Indian Taxation and Legal Domain Expertise Awareness of Competitive Intensity Project Management Railway Engineering knowledge Global Expertise Value Engineering Cost Optimization Special Technology construction Patented Construction/ Expertise Italian Partner

25 USA 1432 K Street NW Washington DC Phone: Fax: ITALY Coro Venezia Milano Phone: Fax: INDIA Fairlink Center Off New Link Road Mumbai Phone: Fax: