Namma Railu - Economic Returns!

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Commuter Rail

In the era of market economy, there is absolutely no chance or room for any projects only on basis of social good. The government officials who are entrusted to consider such projects for approvals are increasingly scrutinizing the projects very closely taking into account the investments and returns it will accrue in coming years.

Namma Railu proposal is also going through the such close scrutiny in government corridors on its economic viability. This is what the Principal Secretary at UDD (Urban Development Department) had to say about their due diligence on according approval to Namma Railu proposal.

"...Yes we are looking at it.  Since this is a cost intensive project, the project requires lots of thinking and co-ordination from various authorities and takes time. Once positive steps are taken, we hopefully will like to forward..."    - Dr. Amita Prasad, Principal Secretary, UDD.

Though it is well known that investments into any infrastructure projects specially in the Mass transit systems, is always a profitable venture. Not sure if the officers in GOK had enough time to ponder upon the economic benefits of Namma Railu so that their job becomes little easy and see less roadblocks in approving the project.

Here is an another attempt to bring out the economic benefits that Namma Railu will bring in with its introduction in the region. Hopefully, these will not go unnoticed in government, political and public corridors.

What is the cost of building CRS

Per RITES, the cost for building amd making CRS operational will cost in the range of 8000-9000 Crores. Here is an comparison of CRS cost with other planned mass transit systems in Bengaluru

What does 8000 Crores will deliver?

This 8000 crorer investment will not only help introduce CRS in Bengaluru but would have enhanced the entire railway infrastructure capacity. Here is a snapshot of what thsi investment will do:

  • Create capacity to operate CRS services - 500 Services per day
  • Capacity enhancements at SBC, YPR, BYP, YEL - Will Double i.e. Platforms, stations
  • Railways will be able to double the number of long distance trains it can operate and handle
  • Enhancements to passenger amenities including Ticketing counters, Parking etc.
  • ROB/RUB at every railway crossing in the CRS operational region - Safety and easing congestion due to manned crossings

Return on Investment?

As it is known world over that every rupee that is invested in mass transit infrastructure will yield 6 rupees in return. Here is the list of potential economic returns of 8000 Crores of investment in CRS:

  • Total Economic Returns - 6 times of investment
  • 48,000 crores in economic return on an investment of 8000 crores.
  • Business Sales -  3 times of investment
  • Income to GOK in Taxes and recipts - 1500 crores per annum
  • Savings in the lieu of other PT projects – 10,000 crores

GOK's income of 1500 crores P.A. alone is more than enough to recover the cost (8000 Crores) in 5 - 6 years. Other economic returns are icing on the cake.

Employment generation in construction, operations of CRS?

There is no need to write about the employment generation due to activities in initial building/construction and operation of CRS. Per this report ,

  • Every $10 million invested in transit capital projects yields 300 jobs (Directv and Indirect)
  • Every $ 10 million invested in transit operations generates 600 jobs (Directv and indirect)

Will stimulate economic growth in adjacent towns?

It is not a brainer to know the potential for catchments areas to benefit economically from CRS operations. Trains brings industries and business thereby bringing in increased economic activities in the vicinity. In the context of Namma Railu, it is foregone conclusion that towns of Mandya, Ramanagaram, Malur, Bangarpet, Chikballapur, Doddaballapur and Tumkur will see the economic growth that is not seen in past. Economic growth means, prosperity in towns. Who doesn't want it?

Any scope for upward mobility of poor and economic weaker sections?

If CRS is implemented in right manner, it will facilitate affordable access to schools/colleges, industries and businesses thereby helping people from lower economic strata to help themselves to move upward. Greater education means more opportunities for better jobs. Better jobs means more monthly income, i.e opportunity for greater prosperity. Looking at the potential of economic prosperity accrual due to CRS, it is not wrong to say, CRS has potential to be project for poverty alleviation in rural and urban areas of Bengaluru.

These are few Namma Railu benefits that one can not ignore. Though pages and pages, blogs after blogs can be written to enumerate the benefits, but the listed ones should be enough to consider CRS for approval and early implementation.

Dear Prajagale, let us know if you still not convinced of CRS benefits? If not social good, shouldn't th these economics are good enough?

GOK, what else should the CRS project do to convince you for its implementation?