Enhanced land compensation may increase Mumbai–Ahmedabad Bullet Train Project cost

Ahmedabad, India (Metro Rail Today): The Mumbai–Ahmedabad High-Speed Rail (MAHSR) Project could face a substantial increase in its overall project cost after enhanced land compensation awards in Gujarat were challenged before the Gujarat High Court. According to submissions made by the project authority, the revised compensation determined by the Land Acquisition, Rehabilitation and Resettlement Authority (LARRA) could result in an additional financial burden of nearly ₹40,000 crore, including interest, if applied across similar cases.

The High Court has admitted the appeals filed by the project authority and issued notices to the respondents. The matter is scheduled for further hearing on 5 August, when the court is expected to consider whether the enhanced compensation orders should be stayed.

Project Authority Challenges Compensation Awards

The appeals relate to land acquired for the Mumbai–Ahmedabad Bullet Train corridor in Ochhan village of Bharuch district, Gujarat. The land was acquired following a notification issued in 2018 under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

According to court submissions, the original land acquisition authority had fixed compensation at ₹50 per square metre in 2020, resulting in compensation of approximately ₹85.86 lakh for one of the land parcels. Following an appeal by the landowner, LARRA enhanced the compensation to ₹660 per square metre, increasing the award to approximately ₹8.46 crore.

Representing the project authority, Advocate General Kamal Trivedi argued before the court that the revised compensation methodology could have far-reaching financial implications for the high-speed rail project if similar orders are implemented across multiple land acquisition cases.

During the hearing, Trivedi submitted that the project, originally estimated to cost around ₹1.08 lakh crore, could incur an additional liability of nearly ₹40,000 crore due to enhanced compensation awards. He also informed the court that around 85 more appeals are expected to be filed concerning similar compensation enhancement orders in central and southern Gujarat.

Dispute Over Valuation Methodology

According to the project authority, the dispute centres on the methodology adopted by LARRA for determining the revised compensation. The authority has argued that the tribunal relied on the jantri (government guidance) value of land in Simartha village, located approximately 14 kilometres away from the acquired property, instead of considering sale transactions involving comparable land in the vicinity of Ochhan village.

The appeals further contend that LARRA relied on an earlier land acquisition award related to the Vadodara–Mumbai Expressway and applied annual escalation to determine the revised market value. The project authority maintains that compensation should instead have been calculated based on the average sale price of comparable land transactions conducted between 2015 and 2017, in accordance with the provisions of the Land Acquisition Act.

The Gujarat High Court has directed the project authority to submit a reasonable proposal indicating the amount it is willing to deposit against the enhanced awards before the next hearing.

"Timely land acquisition and a transparent compensation framework are fundamental to the successful execution of large-scale infrastructure projects. While it is essential to ensure that affected landowners receive fair compensation, maintaining financial certainty is equally important for projects of national significance. A balanced legal and policy framework can help safeguard public investment while ensuring equitable outcomes for all stakeholders," said Mrs. Mamta Shah, MD & CEO of Urban Infra Group.

India's First Bullet Train Project Progresses

The 508-kilometre Mumbai–Ahmedabad High-Speed Rail Corridor is India's first bullet train project and is being implemented by the National High Speed Rail Corporation Limited (NHSRCL) with technical and financial cooperation from Japan. The corridor will connect Mumbai in Maharashtra with Ahmedabad in Gujarat using Shinkansen high-speed rail technology, significantly reducing travel time between the two cities.

The project was originally targeted for completion by December 2023, but construction timelines were affected by delays in land acquisition, tendering processes and disruptions caused by the COVID-19 pandemic. The corridor is now planned to be commissioned in phases, with the first operational section in Gujarat expected to open in 2027, while the complete corridor is targeted for completion by 2029.

According to official project updates, the Mumbai–Ahmedabad Bullet Train project had achieved 55.63% physical progress and 69.62% financial progress as of 30 November 2025, with cumulative expenditure reaching approximately ₹86,939 crore by February 2026.

The outcome of the ongoing legal proceedings is expected to have significant implications for the project's overall financial framework and future land acquisition cases, while construction activities on other sections of the high-speed rail corridor continue in accordance with the implementation schedule.