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G20 Summit update: India-Middle East-Europe' economic corridor including shipping and railway links will be launched soon. The first-of-its-kind economic corridor will be a historic initiative on cooperation on connectivity and infrastructure involving India, UAE, Saudi Arabia, EU, France, Italy, Germany, and the US.
Biden, Indian Prime Minister Narendra Modi and European Commission President Ursula von der Leyen announced the project during the annual Group of 20 summit of the world's top economies. The project is part of an initiative called the Partnership for Global Infrastructure Investment.
Saudi Arabia, the European Union, India, United Arab Emirates (UAE), France, Germany, Italy, and the US committed to work together to establish the India-Middle East-Europe Economic Corridor (IMEC).
The corridor is expected to stimulate economic development through enhanced connectivity and economic integration between Asia, the Arabian Gulf, and Europe.
The IMEC will comprise of two separate corridors, the east corridor connecting India to the Arabian Gulf and the northern corridor connecting the Arabian Gulf to Europe.
It will include a railway that, upon completion, will provide a reliable and cost-effective cross-border ship-to-rail transit network to supplement existing maritime and road transport routes – enabling goods and services to transit to, from, and between India, the UAE, Saudi Arabia, Jordan, Israel, and Europe.
Along the railway route, they intend to enable the laying of cable for electricity and digital connectivity, as well as pipe for clean hydrogen export.
The White House report stated that the rail deal will link shipping and rail lines from India to Europe through the UAE, Saudi Arabia, Jordan and Israel.
"The 'India-Middle East-Europe' economic corridor is historic. It will be the most direct connection till date that will make trade faster," said Ursula von der Leyen, European Commission President, at the Partnership for Global Infrastructure Investment (PGII) and India-Middle East-Europe Economic Corridor programme at Bharat Mandapam.
The consensus on the New Delhi declaration by all G20 member countries despite a divided house given the ongoing war in Ukraine and the West’s sanctions on Russia, the ambitious rail-port economic corridor deal to connect India-Middle East-Europe, and the launch of Global Biofuel Alliance on the summit sidelines seemed to have attracted investors to bet in the market.
Atmavik wrote: ↑12 Sep 2023 09:25
^^ why is this route better for us compared to a large container ship going thru the Suez ?
It's a shorter route as route map will show. Cargo from Bombay will roughly follow North West-Northern path as opposed to a West-North West route if transiting via the Suez canal. It avoids the piracy prone zone, besides derisking passage via the Suez Canal. Part of the transit would be via rail which is faster.
^^^^ Sir, transshipment is *very* slow. Any gains of rail speed with be negated by the transshipment process and throughput of rail. A ship may carry around 10000 40' containers. A single rail rake in India holds 45 single stacked and 90 double stacked. Assuming they build a double stacked rail network, you are looking at roughly 100 trains to transport the load of a single container ship. With a 5 minute headway between trains, that is 12 per hour or about 8 hours to accommodate the entire contents of a single ship. So even with round the clock operation of the rail service, you are looking at the equivalent of no more than 3 ships per day. Suez handles about 35 ships per day per direction.
Rail is fine for sure, and China managed to ship quite a few baubles from Yiwu to Europe via trains (till presumably Russia-Ukraine conflict shut it down) but it is no replacement. Oh wait, looks like the train is still running http://en.people.cn/n3/2023/0808/c90000-20055500.html So much for European boycott of Russia.
IMEC Corridor solves many geopolitical issues and brings win-win for many countries involved.
Background issues:
1.Europe is struggling with energy issues
2. India is supplying Europe, refined oil produced from Russian crude (We're the refining super power). This is worrying for Saudi's and creating political backlash in Europe.
3. Suez is seeing huge pressure due to the Indian oil going to Europe, this is never been the case, they always got the Russian oil/gas through pipeline and Ukraine war has changed this equation.
Solution:
Create new sea/rail route.
India gets more oil from Saudi's and refine them to Europe. In return Saudi's invest in building this corridor. North of Saudi is less developed, Saudi is spending a Trillion Dollar in building brand new City 'Neom'. This will fit well for them.
India already has leased Haifa port, develop it further. This relieves the pressure on Suez and creates alternate route.
Who are losers: Turkey, Pakistan and China.
Mild negative impact: Egypt, hence Modi visited them on the way back from US, promising some investments and future trade with them.
Not sure about Russia in this scenario.
What's the future:
We need to complete the DFC quickly to bring the goods from Hinterland to JNPT and then to Gulf/Europe.
Gulf is very much interested in Food processing they want to move to manufacturing quickly, rather than a commodity supplier.
This is a triumph of our diplomacy, that's for sure. Our diplomats have used the current environment to shape this to the advantage of us and made new partners/ strengthened existing partners.
The extra effort due to two transhipment/rail connection is nothing compared to encircling around Africa.
Thanks SivaR,
A lot of complicated thinking seems to have gone into this, but perhaps it will work out. Let us see...
Egypt will be fine, this will take a few years, perhaps a decade to materialise. But even then, it wont impact Suez traffic all that much as you said.
Our stupid opposition hasn't caught on which company got the contract to operate Haifa port
Paki's have lost their strategic deth when the US pulled out of Afg and their Geonomics wet dream has been shattered now. When will they realise their real enemy is the US?
The India-Middle East-Europe Economic Corridor seems like a geopolitical agreement that literally bridges ports , railways,energy [ oil ; Gas ; Electricity ; Internet ] , It seems the services , hard facilities of transit , development zones along bridging and binding different countries into a giant ecosystem of energy and economic activities.
The possibilities are enormous and limitless.
Saudi can transition to a future where it is not a oil producer but a part of something bigger. It is a vision. Bin Salman needs more credit to understand Modi's and the pan India vision of .. vasudaivakudumbakam !!
BRI is dead., and pakis a basket case.
drnayar wrote: ↑12 Sep 2023 19:53
The India-Middle East-Europe Economic Corridor seems like a geopolitical agreement that literally bridges ports , railways,energy [ oil ; Gas ; Electricity ; Internet ] , It seems the services , hard facilities of transit , development zones along bridging and binding different countries into a giant ecosystem of energy and economic activities.
The possibilities are enormous and limitless.
Saudi can transition to a future where it is not a oil producer but a part of something bigger. It is a vision. Bin Salman needs more credit to understand Modi's and the pan India vision of .. vasudaivakudumbakam !!
BRI is dead., and pakis a basket case.
Sir this is reviving the historical trade routes which were the basis of economic strength of the Nabateans.
Also, refer my post in West Asia forum which discusses how the GCC Rail vanity project becomes viable and the backbone of this new route.
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
tandav wrote: ↑13 Sep 2023 00:19
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
Exactly, not sure how much we r investing in this but we should focus on completing all the DFCs and build large ports that can take these ships
Taking a step back and looking at the next 2 decades, here's a very interesting video from none other than Harsh Madhusudan expanding on his thesis for going long on India... must watch!!
tandav wrote: ↑13 Sep 2023 00:19
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
Container ships will ply on most of the route, but bypass the Suez bottleneck by land. The land route has no bottleneck and can use many trains/trux. Currently it takes 4 weeks for India-Europe shipping. This will be cut to about 2 weeks. Cost/speed tradeoff is apparently favoring the latter.
Furthermore, these kind of projects are not just about goods shipment cost, an much broader energy and trade infrastructure will arise along the route, creating a much larger multiplier impact.
The wannabe-ottoman is apparently pissed off about this (probably because it favors Greece), and instead is proposing another route that goes through Iraq and Turkey. Nobody in right sense would send goods through Iraq. Maybe this route will be ideal for shipping of pawkee unskilled labor and jihadis.
tandav wrote: ↑13 Sep 2023 00:19
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
The Suez Canal is already overcapacity, UAE, OMAN ,Saudi have lots of Land, run 4-6 tracks with 2Km Double stack Containers, this will work.
Each Freight train can carry 1000 40ft or more FT containers, with 200 or 300 locomotives, Each Sheshnag freight train is 2.8 KM long.
yensoy wrote: ↑12 Sep 2023 13:31
^^^^ Sir, transshipment is *very* slow. Any gains of rail speed with be negated by the transshipment process and throughput of rail. A ship may carry around 10000 40' containers. A single rail rake in India holds 45 single stacked and 90 double stacked. Assuming they build a double stacked rail network, you are looking at roughly 100 trains to transport the load of a single container ship. With a 5 minute headway between trains, that is 12 per hour or about 8 hours to accommodate the entire contents of a single ship. So even with round the clock operation of the rail service, you are looking at the equivalent of no more than 3 ships per day. Suez handles about 35 ships per day per direction.
Rail is fine for sure, and China managed to ship quite a few baubles from Yiwu to Europe via trains (till presumably Russia-Ukraine conflict shut it down) but it is no replacement. Oh wait, looks like the train is still running http://en.people.cn/n3/2023/0808/c90000-20055500.html So much for European boycott of Russia.
Bhai, two things! I think you got the container count wrong!
Moreover, the longest freight (iron ore) train is over 7.8Kms. The length of the train is usually limited by the bypass route. So we need to redo this estimate. Add downtimes, shipping insurance costs and transportation costs...
Plus, the role of this railway line is to supplement Suez Canal
Coming to finance aspect, we need to look at how much rail line should be laid and ME Govts spend money on useless projects like Neom artificial islands, do they consider this as a financial burden?
tandav wrote: ↑13 Sep 2023 00:19
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
If the transport capacity by trains makes IMEC useless, then the same logic would apply to Belt part of china's BRI.
I would like to know the time and cost for transferring containers from ship to train and again from train to ship.
yensoy
Many people have weighed in with their observations on the rail versus ship in the context of IMEC alternative route to and from Europe. I would add a couple of more general observation. Capital is agnostic between types of transportation and if investment is not viable in itself, capital doesn't flow into it. Similarly shippers/ sellers and buyers look at inventory carrying cost which will assign a value for the duration a cargo is in transit. Second, transhipment is an inescapable part of international commerce. Not every port has the capacity to handle heavier vessels. There is a reason why Colombo has become a favorite transit hub in comparison to say, Tuticorin.
But all in all an interesting discussion.
True. Also, in the domain of "second sourcing" which is to have a second supplier for a certain input to your process, it is often enough to only route 15-20% of your needs from the second source. The second source sets the pricing and allows you to negotiate discounts, the second source vendor can quickly ramp up production to at least get you to 40-50% quickly so that you don't need to sit idle if your main source seizes up. I see the overland corridor as a second source which will be a good supplement to Suez and indeed other routes (such as around Africa, and thru Iran/Russia). The more the merrier.
But this isn't only about logistics. The solar continuum from Singapore to Saudi Arabia can be a phenomenal outcome if we can move tens of GW of solar power in undersea HVDC cables. It will severely reduce the need for battery storage across India, Saudi and Singapore while we are able to tap into solar power for many hours before sunrise/after sunset. This is a privilege we have being close to the equator that the developed world doesn't (at least not in the winter).
tandav wrote: ↑13 Sep 2023 00:19
Any transhipment of a ship based cargo to a land based transport via trains or trucks seems impractical. One Evergreen class container ship is 20000 TEU each 40Ft or 12.2m long. The length of a double stacked train pulling this over land ~(20000/2)*12/1000= 120km long train for ONE Evergreen class Container ship. Trucking on 6 lane highways may make more sense. Or quadro stacking 4 TEUS per bogie and going for super wide gauge rail.
Trucks are fuel hungry, labour costs.
Evergreen ship moves at a speed of 10NM or 18Km per hour where as train will move at speed of 100km per hour so the train length gets reduced by 5, in other words 20km. 10 trains of 2km each.
My Rough Calculation on ME Train Route... Ideally, I would like to spend a lot of time on this. But all the calculations were made with less than 1 hr of Google research.
Few assumptions for ease of calculation!!
I am considering Mumbai to Suez and Mumbai to UAE Port routes
Speed of Freight Ship is 10NM though modern ships can hit upto 16NM under ideal conditions, but 10NM is generally more economical.
Speed of Freight Train is 90Km and zero stops at signal stations (Ideally 100km is targeted and I am subtracting 10% to cover up signal delays)
Lag time for shipment from ship to train is 12 hrs.
No of Ships passing through Suez per day is 60
Average Containers per ship is 9000
Total container is 540,000. They start from Mumbai and reach Suez after 14 days of travel.
Now, we have to see if our rail road can achieve 10% of this volume in best case. However, these are rough calculation, ideally we should look at how much freight IR can push and at what speed, then what are the cargo handling capacities of UAE and Israel ports, based on that we should be able to the capacity of ME Freight Corridor handling capacity,
Now 60 ships of 9K containers left Mumbai, after 5 days, they should be able to reach UAE. Let's give 12 hrs of lag for Cargo to rail loading.
300 container train with a length of 2km should start right after couple of min.
If 180 trains of 2Km leave UAE Port then we will cover 10% of total shipping.
Since we assumed that train speed is 5 times.
Even if 36 of 2km leave UAE Port leave per day, we will cover 10% of the volume.
But we have to account for Godown Storage Cost and Diesel or electricity cost. Cargo Ships use furnace oil which is very cheap and often a waste product for refineries.
FYI Pak sold its furnace oil at a loss just to get rid of it as their furnaces are old and inefficient
Given the much lower cost of obtaining recycled feedstock/raw materials (i.e. scrap) relative to virgin feedstock (i.e. mining), Bharat's low processing costs will make this sector a clear winner and can hugely boost our manufacturing bottomlines across the board.
VishnuS wrote: ↑14 Sep 2023 13:10
Trucks are fuel hungry, labour costs.
SA and UAE have very low fuel costs. Price of diesel in SA is $0.75/gal versus about $4/gal in USA and India. Also, the land route could be electrified (both trains and trucks) with the India-West Asia cable link which is also part of this.
Both in terms of fuel costs and lead time, this project makes a lot of sense. And additionally, its much more than just a shipping route. These things are carefully calculated before announcing them. Bharat needs to make bold and innovative moves like this, and its success will be a huge prestige booster for us.
VishnuS wrote: ↑14 Sep 2023 13:10
Trucks are fuel hungry, labour costs.
SA and UAE have very low fuel costs. Price of diesel in SA is $0.75/gal versus about $4/gal in USA and India. Also, the land route could be electrified (both trains and trucks) with the India-West Asia cable link which is also part of this.
Both in terms of fuel costs and lead time, this project makes a lot of sense. And additionally, its much more than just a shipping route. These things are carefully calculated before announcing them. Bharat needs to make bold and innovative moves like this, and its success will be a huge prestige booster for us.
Labour costs and maintenance cost of trucks will be too high.
There is a reason why trains are cheap for inland transportation.
Most of the rail network already exists, but does the existing road network handle 1,04,000 trucks (of 30+ plus tonnes each day). Drivers(2 per truck) would drive it max of 16 hours per day.
Maintenance of 5.5 lakh (1,04 lakh × 5 days of journey + 30K trucks down due to maintenance) trucks and 11 lakh drivers is what we should look at.
Trucks are good for tertiary transport but not as main transport. There is a reason why GOI wants to bring the transportation cost of goods and Gati Shakti came into existence. Once it becomes operational and we have a solid understanding, then new rail lines will be laid out and all of the intercity transport will happen via rail lines.
Another model one can think of is entire goods trains directly loaded on ship (so, no time or labour wastage trasferring containers between ship and train twice each way). Train ferries existed for a century.
The trade-off being unproductive weight. May be there are ways to minimize this.
Y I Patel wrote: ↑13 Sep 2023 00:57
Electricity transmission cables between India and Saudi Arabia will be able to dramatically prolong Solar power generation uptimes
How are transmission losses managed? Using sealed under sea step up/down transformers?
a_bharat wrote: ↑15 Sep 2023 13:03
Another model one can think of is entire goods trains directly loaded on ship (so, no time or labour wastage trasferring containers between ship and train twice each way). Train ferries existed for a century.
The trade-off being unproductive weight. May be there are ways to minimize this.
Nope, that is a bad idea! Length of the ship is short! Container are stored on top of each other, this is not possible
Why not just well built Cranes which load on to ships fast and similarly offload from ships on flat railway wagons with custom scanning off go the freight trains
VishnuS wrote: ↑15 Sep 2023 09:34
Labour costs and maintenance cost of trucks will be too high.
There is a reason why trains are cheap for inland transportation.
Look, I am not arguing for "trucks" over "trains" or anything of the sort.
I just said the overall project is very much feasible and will have a multiplier effect. Whether the trains/trucks/jinn-jahaz will be powered by diesel or electricity from the linked India-SA grid, the energy costs will be quite low. This is getting into the weeds here.
As I understand, many Indian companies have been asked to prepare for this, so whatever is decided will be likely profitable for all concerned.
End of story as far as I am concerned, till we hear future news about the details.
The IMEC will comprise two separate corridors, the east corridor and the northern corridor. The east corridor would connect India to the Arabian Gulf and the northern corridor would connect the Arabian Gulf to Europe. The project would include railways and waterways. The railway will provide a reliable and cost-effective cross-border ship-to-rail transit network to supplement existing maritime and road transport routes.
Railway Minister Ashwini Vaishnaw in an interview said that the IMEC will be “substantially different” from the BRI. “Compared to the Chinese project that has pitched some of its host nations into a debt trap, the G20 project will bring in revenue and be bankable. The PM’s vision of taking everyone along is an important part of this corridor.”
Today,s inauguration of vishwakarma scheme and world,s largest convention center Yasho Bhoomi by Modiji may not be sending space craft to the moon and sun , may not be artificial intelligence related or high tech related or earth shattering but it actually is all of the above. This will prove to be one of the most important scheme,s by this govt. It is the forgotten , the lowest of the low , the poor people of India but with the hand skills better than anyone in the world that will benefit. It is this kind of innovative scheme,s that is getting India to where it belongs, at top of the world by caring for these people in innovative ways. This will improve the lives of millions of Indians.
Mark my world Indian handicrafts will be far more expensive in the coming decades compared to today. The skills of our stone cutters that make our incredible temples, our artisans that make designs on the cloth, our carpenters that make beautiful furniture available in Kirti Nagar in New Delhi and saharnpur in UP, our carpet makers, our pottery workers, our toy makers, our shoe makers, our barbers, our Halwai,s that make those world beating sweets and snakes. It is about time the world experienced their skills. They are the best in the world and their time has come to improve their lives and enrich the world.
It is these people who will make India a world power simply by improving their lives and thereby improving India. It is this kind of scheme that can only come from someone who really understands India, it,s villages and small towns, the real India which has been doing this for thousands of years.
A few Jihadi scums will not spoil this day for India.
Suresh S wrote: ↑17 Sep 2023 20:51
This will improve the lives of millions of Indians.
Mark my world Indian handicrafts will be far more expensive in the coming decades compared to today.
It is these people who will make India a world power simply by improving their lives and thereby improving India. It is this kind of scheme that can only come from someone who really understands India, it,s villages and small towns, the real India which has been doing this for thousands of years.
A few Jihadi scums will not spoil this day for India.
Jai Hind
Agree. But to the point AI and robotics are the future. There would be a place for niche products as well as long as specific IP is generated as per traditional items. Much like "banarsi silk" "basmati rice"
Hitachi Payment Services, a subsidiary of Japan-based Hitachi, launched India's first UPI-ATM in collaboration with the National Payments Corporation of India (NPCI) at the Global Fintech Fest in Mumbai on Tuesday, to enable customers to withdraw cash without a debit or credit card.
United Payments Interface, or UPI, is a mobile payment method operated by NPCI that allows the transfer of funds from one bank account to the other, instantly and for free.
"The launch of the UPI-ATM will mark a significant milestone in banking services by seamlessly integrating the convenience and security of UPI into traditional ATMs. This innovative concept is designed to provide quick access to cash even in the remote areas of India without the need for a physical card," NPCI said.
How does it work?
Users need to select the "UPI cash withdrawal" option on the ATM and select the amount to be withdrawn. A single-use QR code will be displayed on the screen. Users can then scan the QR code on the screen from any UPI app on their phones, input their pin, and get the cash.
Vayutuvan wrote: ↑16 Sep 2023 05:59
Probably that can be arranged with some obvious engineering gizmos. Your post made me visualize a system. I have it my mind's eye.
I am curious. Please explain. Thanks.
I was thinking something similar to what CargoBeamer people seem to have already done. It would require extensive modifications tothe ports themselves. Reduced loading/unloading costs/time may not offset the upfront capital spend.
Modifications of BargoBeamer itself is possible. Scheduling the placement of the containers on trucks/trains/ships/trains/trucks is ofc a very hard optimization problem. If it has to be solved for true optimality, it would be a mixed integer non-linear programming (MINLP) problem. Even MILinearP problems are NP-hard. Relaxation method is a reasonable approach which solves a related linear programming problem. Since LP has polynomial time algorithms, the relaxation method is quite popular in the industry. That said, solving the place/route/schdule is just a part of the entire solution. Physical infra needs big bucks.
So much for European boycott of Russia. 
