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With Dhaka metro order, Marubeni aims to unclog Asia's streets

Japanese trading house and India's Larsen join hands in Bangladeshi capital

Dhaka's traffic congestion represents an urgent issue, as it costs the city over $2 billion a year in economic activity. (Photo by Yuji Kuronuma)

TOKYO -- Trading house Marubeni will build signal, ticketing and other systems for the first metropolitan railway in the Bangladeshi capital of Dhaka, seeing business opportunities in combating traffic and pollution in Asian cities.

Dhaka plans to build six mass rapid transit routes, with lines 1, 5 and 6 scheduled to open in the 2020s. Dhaka Mass Transit, a company under the transportation ministry, will place an order worth 55 billion yen ($505 million) that covers the 20km Line 6, an elevated rail line that will have 16 stations connecting the city's north and south sides.

Marubeni will receive the order jointly with Indian construction and engineering company Larsen & Toubro.

The Japanese company will deliver signal and communications systems that comply with Japanese standards and are known for safety and timeliness. The order will include rails, ticket machines and other equipment.

Other Japanese companies are also involved in construction of Line 6. More orders are expected for Japanese companies for the other five lines.

Bangladesh has long-distance track connecting the capital to regional cities but lacks metropolitan rail.

Line 6 originally was scheduled to open in 2019, but bidding was delayed by a terrorist attack at a Dhaka bakery in July 2016 that killed over 20 people, including seven from Japan who were conducting a survey for the transit system.

Dhaka's population of roughly 15 million appears likely to reach 20 million in 2025 thanks to economic growth. The city's economic losses from traffic congestion are estimated to surpass $2 billion a year, and air pollution is also severe. Line 6 is expected to carry about 500,000 passengers daily and reduce north-south travel time to about 30 minutes from two hours by car.

A variety of mass rapid transit and light rapid transit projects are sprouting up around Asia to deal with traffic and other consequences of economic development. Japan's exports of domestically manufactured trains, excluding high-speed rail, totaled 94 cars in fiscal 2016, the Japan Association of Rolling Stock Industries said. That figure is expected to reach 150 in fiscal 2019 and about 200 in fiscal 2020.

Reorganization in ongoing in the global railroad industry. Chinese train maker CRRC -- born from the merger of CSR and China CNR -- is accelerating its expansion abroad, while Germany's Siemens and France's Alstom plan to combine their rail operations.

Though Bangladesh poses challenges such as political instability and religious conflict, Japanese companies are eager to expand abroad as Chinese train producers -- promoting the country's Belt and Road Initiative -- and other rivals advance into Asia. CRRC recently won an order with Canada's Bombardier for a monorail in Bangkok.

Marubeni aims to attract more orders from Asia, which it views as a major growth market, by promoting benefits such as lower operating costs thanks to the technological prowess of Japanese train makers and the "internet of things."

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