Japan Railway & Transport Review No. 60 (p42-441)
Special Feature : Establishment of Japan International Consultants for Transportation and Expansion of Future Business Overseas
Japan International Consultants for Transportation Co., Ltd. (JIC) was established on 1 November 2011 as a joint venture between seven of Japan’s major railway operators to provide consulting services to railways outside Japan. Shareholders include East Japan Railway Company, West Japan Railway Company, and Tokyo Metro Co., Ltd. After various preparations, such as establishing procedures to take over business outside Japan conducted by Japan Railway Technical Service (JARTS), JIC started practical operations on 1 April 2012. Three new shareholders were also added on 2 April, making a total of 10 shareholders. This article covers the background behind the establishment of JIC as well as its roles and future outlook.
|Changes in Railway Environment|
With the global emphasis on environmental issues and the
growth of emerging economies, appreciation of railways as
public transport is on the increase and various countries
are planning and carrying out railway projects. Some
forecasts show that the scope of the global railway market
is expected to grow by 37% from an average procurement of
approximately \16 trillion in the 3 years from 2005 to 2007 to
\22 trillion in 2020. This basic growth trend seems likely to
continue into the future.
|Background and Purpose for Establishing JIC|
Railways are planned to a standard or specification reflecting
the political, social, economic, and other situations of a
country. As a result, a railway system cannot be changed
easily once completed. For this reason, if a consulting firm that
is well versed in Japanese railway systems participates from
the early stages in forming concepts or basic planning when
standards and specifications are decided, and can receive
orders for consulting work from the organization placing the
order in the next implementation phase, an optimum railway
system anticipating the national needs can be proposed.
Such a system can be based on Japanese railway systems
from basic specifications through infrastructure, system
design, and bid documents. Consultation for railways outside
Japan can contribute to national and international progress
through involvement in such projects. At the same time, it
can sustain the growth of Japan’s railway industry. The roles
that must be fulfilled in enhancing the functions of Japan’s
consulting for railways and railway projects outside Japan
are becoming increasingly important.
Many such past roles have been fulfilled by JARTS,
which was established in 1965. JARTS has an enviable
track record of achievements, such as transfer of Japanese
railway technologies to other countries and development of
human resources. However, as an incorporated association,
JARTS faced the problem of lacking both human and
financial resources in terms of being able to further expand
business in the current situation where international
competition is fierce and a quick and assertive response is
needed. Moreover, JARTS consulted for the ordering party
while having members whose main business interest was
in receiving orders, leading to concerns about a conflict of
|Table 1: JIC Corporate Overview (2 at April 2012)|
|Major Projects Outside Japan|
To secure eligibility to receive orders for railway projects and
to implement projects smoothly, JIC took over the JARTS
management resources, know-how, etc., on 1 April 2012.
At the same time, in-progress projects outside Japan were
transferred from JR East Consultants Co., Ltd. (JRC). Thanks
to these initiatives and new orders, JIC is now consulting on
projects in eight countries as of May 2012.
The high-speed rail projects include surveying for
advance plans for high-speed rail links between Hyderabad
and Chennai (fifth corridor) and between Chennai,
Bangalore, and Ernakulam (sixth corridor) in India, as well
as a project to draw-up plans for constructing a north-south,
high-speed railway in Viet Nam.
Urban railway projects include construction of the Ho
Chi Minh City Urban Railway Project Line 1 and the Hanoi
Urban Elevated Railway Line 1 in Hanoi and Ho Chi Minh
City, Viet Nam, as well as detailed designs for the Greater
Cairo Metro Line No. 4 in Egypt. In conventional lines, JIC
is involved in planning surveys to modernize a trunk line
between Yangon and Mandalay in Myanmar.
Projects in human resources related to operating
organizations that are closely tied to O&M are in progress
in Viet Nam. Specifically, JIC is proposing the organization,
personnel, fare system, rule implementation, driver licensing,
education and training, maintenance standards, and more,
needed to establish an urban railway operator through the
Project for Support of Set-up of Operation and Maintenance
Company for Urban Railways in Ho Chi Minh City, and
the Hanoi Urban Railway Operator Establishment Special
Assistance for Project Implementation Survey. These are
examples of JIC-specific consulting business that can help
achieve strong coordination with major railway operators
investing in the company.
|Figure 1: Major Overseas Projects|
|Direction of Future Business Expansion|
As described, JIC is pushing forward with a wide range of consulting business, including upstream stages such as work ranging from railway project proposal to design and construction supervision and downstream stages such as O&M, as well as advising on railway service provision in general. The goal is to propose the optimum railway system matching local needs. In the future, JIC plans to go beyond railway-related fields to develop consulting business in peripheral fields with close ties to railways. Some areas are lifestyle service businesses in and around stations and, further down the line, general planning integrating urban planning and railway station construction. JIC aims to contribute to country development through railway consulting while also enhancing the international competitiveness of Japan’s railway industry as a whole to help sustain development of Japan’s railway industries. Moreover, through active efforts in fostering globally minded people, JIC hopes to support future international business development outside Japan.
Mr Tanaka is the President of Japan International Consultants for Transportation Co., Ltd. He joined JR East in 1987, following the privatization of JNR. He assumed his current position in November 2011, after serving as President of JR East Consultants Company, a subsidary of JR East.