Will a Steel Scandal in Japan Affect India’s Bullet Train Project?

As Japan grapples with a new scandal, a fear of India’s ambitious bullet train project getting delayed has surfaced.

Image used for representational purpose.

(Photo: Reuters)

India has been working on getting bullet trains for a while. Japan is helping India achieve that dream for the Ahmedabad-Mumbai train, but a major scandal unfolding there is likely to have repercussions in India as well. The question is, will this scandal have a big enough impact to derail the dream of a functioning bullet train by 2022.

What Is the Scandal in Japan?

Kobe Steel Ltd, a 112-year-old Japanese steelmaker has been accused of falsifying data on the strength and durability of some of its copper and aluminum products. Two of the companies operating the high speed Shinkansen trains have said that they have found sub-standard parts, supplied by Kobe steel.

According to Bloomberg, Central Japan Railway Co, which operates bullet trains between Tokyo and Osaka, said aluminium components connecting wheels to train cars failed quality tests. Of the tested parts, 310 were found to be sub-standard, all supplied by Kobe steel. West Japan Railway Co, which runs services from Osaka to Fukuoka, has also found sub-standard parts.

Kobe Steel has admitted to the allegations against it. The company conceded that it had faked data about the strength and durability of some aluminium and copper products, which are used in everything from bullet trains and aircraft to cars and rockets.

Kobe Steel’s CEO Hiroya Kawasaki has apologised in person for the scandal. Over 200 companies have been supplied with sub-standard products. Investigation into about 100 of these has been completed, according to the company. Results of the investigation will be released in 15 days.

“I deeply apologise for causing concern to many people, including all users and consumers,” CEO Kawasaki said. All four of the company’s factories were found to have issues of bad quality aluminium parts. The scandal is now being closely monitored by companies like Toyota, Honda and Kawasaki, all having received sub-quality products. Within two days, Kobe Steel’s share value fell by 36 percent.

Effects on India

Japan’s Prime Minister Shinzo Abe’s first stop on his recent India visit was Ahmedabad, to inaugurate the bullet train project with PM Narendra Modi. The project is top priority for the Modi government; they want the Ahmedabad-Mumbai corridor functioning by 2022. For this, Japan has given India a significant loan, along with technical help. But with this new scandal coming to light, fears over the project getting delayed has surfaced.

Japanese PM Shinzo Abe inaugurated the bullet train project with PM Narendra Modi, recently.(Photo: File/PTI)

Speaking to The Quint, former railway board member VK Agnihotri said:

I worked with Japan’s rail engineering division on some projects in the 60s. They have very exacting quality standards. They have no patience for any defects and shortcomings. A scandal like this is quite surprising, but the chances of it compromising safety are very low. 

On the likelihood of the scandal affecting India, he said there is still time before India gets to the rail coach stage, so there is a chance things might fall into place before that, avoiding any delays for India.

Ethics in May, Scandal in October

Ironically, in just May of 2017, Kobe Steel came out with a ‘core values report’, enshrining six pledges taken by all Kobe employees. They can still be found on KOBELCO’s website. The first of these is “heightened sense of ethics and professionalism”. It states, “We not only follow the law, corporate rules and societal norms, but also conduct our corporate activity in fair and sound manner with the highest sense of ethics and professionalism.

In May 2017, Kobe Steel came out with a ‘core values report’.(Photo Courtesy: Kobe)

India and Japan’s relationship goes beyond bullet trains and is unlikely to be shaken now. The bullet train project is important to both. It doesn’t seem probable that Japan will let any delays happen.

(This article was originally published in Quint Hindi.)

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