Bullet train between São Paulo and Rio? What is known so far – 02/23/2023 – Market

The board of ANTT (National Agency for Terrestrial Transport) authorized the company TAV Brasil to build and operate a high-speed rail line, also known as bullet train, connecting São Paulo to Rio de Janeiro.

The authorized project foresees a route of 380 kilometers and trains running at a maximum speed of 350 km/h. The trip connecting the north zone of São Paulo to the west zone of Rio would take 1h30, according to the company.

The proposal, however, is viewed with distrust by the market. The construction of the bullet train between São Paulo and Rio is an old project that never got off the ground. The theme motivated the creation of a state-owned company during the Dilma Rousseff government, but it did not work.

The decision was published in the Official Gazette this Wednesday (22) and provides that the works will be carried out by 2031, with operations starting in 2032. The estimated investment is R$ 50 billion.

The authorization model for the construction of the railroad, however, does not oblige the company to start the works. At this first moment, ANTT evaluates only the “location feasibility” of the project, that is, if it does not have an impact on other existing or projected railroads.

In the decision, the agency’s technical area concluded that, although there are MRS logistics cargo stretches in the region, there is no “conflict between the railroad tracks object of the claim in question and the other infrastructure implemented or granted”.

“From the authorizations, it is up to each company to conduct the negotiations to get the project off the ground, assuming all the risks of the business”, says the ANTT.

“Thus, the obligations of obtaining licenses from the competent bodies; the development of engineering and socio-environmental feasibility projects; the search for financing and the definition of the stages of the work will be the responsibility of the private sector –and not the State–.”

TAV Brasil did not respond to questions about the economic viability of the project. With a share capital of BRL 100,000, the company was created in February 2021 and has as partners Infra SA Investimentos, Global Ace Participações e Investimentos and lawyer Marcos Joaquim Gonçalves Alves.

ANTT says that TAV has 30 days to sign the contract and that, after that period, “there are other milestones that need to be respected in the coming years by the company”, such as a prior environmental license “or even an operating license”.

Introduced by the Jair Bolsonaro government, the railroad authorization model aims to streamline investments in the sector, giving the private sector the possibility of proposing new stretches — before, the federal government tendered works in the concession model.

So far, according to ANTT, 39 stretches have been authorized. Specialists in the sector, however, see viability only in those that have dedicated cargo, that is, connecting producing regions to ports for export.