Thailand and Malaysia are to begin talks on the development of a 1,500 km high-speed railway that may connect the capitals of each countries and improve regional connections.
The Bangkok-Kuala Lumpur route forms a big a part of the Pan-Asian rail network plan – originally proposed by former Malaysian Prime Minister Mahathir Mohamad at a gathering of leaders of the Association of Southeast Asian Nations in 1995.
The idea was to construct a railway network running from Singapore to the town of Kunming in southern China, through Malaysia, Thailand, Burma, Cambodia, Vietnam and Laos.
Much of the present rail network is old and unsuitable for high-speed trains. Modernization works are underway to enhance the mobility of individuals and goods and stimulate the regional economy.
“ASEAN cities should be connected by high-speed rail,” Arkhom said, adding that unlike airways, a rail link “can promote cities along the railway line.”
China’s involvement
Today, this idea closely follows the “Belt and Road” initiative of Chinese leader Xi Jinping, which goals to create an economic corridor from Asia to Europe through the event of land and sea routes.
China’s involvement in regional transport networks is growing. A railway connection between Kunming and the capital of Laos, Vientiane, is currently under construction. This will hook up with one other line China is involved in, connecting Nong Khai on the Thai side of the border with Bangkok.
It’s hard to assume that Beijing won’t attract attention if Thailand and Malaysia seek help for his or her planned high-speed rail. Japan can be keen to export its own shinkansen bullet train technology. Shinkansen is already operational in Taiwan, and agreements have already been signed in India and Thailand. However, in 2015, Japan lost to China within the race for Indonesia’s high-speed rail project.
Japan and China are also currently competing for the Singapore-Kuala Lumpur line, which shall be the primary cross-border high-speed rail project in Southeast Asia. The governments of Singapore and Malaysia have agreed that the 350-kilometer railway line is to be operational by 2026. The proposed Kuala Lumpur-Bangkok route would extend the road across the whole Malay Peninsula.
The route is currently served by low-speed trains running on 1m-gauge tracks. Arkhom says high-speed trains would require the development of a brand new set of normal 1.4m-gauge tracks.
“But if we can’t make big investments, we’ll just stay with the existing 1-meter spacing,” he added. As a key motion plan, Arkhom said Thailand plans to impress diesel trains running between the southern Thai city of Hat Yai and Kuala Lumpur this 12 months. “We have limited resources,” he said.
Shinkansen ‘very expensive’
Thailand currently has two other high-speed rail projects within the pipeline, the financing of which is an ongoing problem.
Regarding the shinkansen project, Arkhom said Thailand plans to propose a Japanese spin-off investment through a three way partnership.
Based on Japanese studies, the proposed cost of the whole 670 km connecting Bangkok to Chiang Mai is estimated at around 500 billion baht ($14.2 billion), which Arkhom describes as “very expensive”. The China-backed railway project linking the Laos border with the Thai capital spans an extended distance of 873 km but is predicted to cost just 379 billion baht.
“[The plan from] the Japanese band relies on Japanese standards, but… [the railway] won’t be in Japan and we will not be as wealthy because the Japanese,” Arkhom said, arguing that Japan should compromise on standards apart from security “to make it occur on this country.”
A three way partnership could be a win-win solution for each parties, he suggested. The investment ratio shall be discussed further. “To make sure that [shinkansen] technology is with us forever, why don’t you come and run the project together?”
Construction is planned in two stages. The first one, connecting Bangkok and Phitsanulok and covering 380 km, will start in 2019. Work on the second half is scheduled to begin a 12 months later. The entire route is scheduled to be accomplished by 2023.
Meanwhile, the Sino-Thai project will announce the primary round of construction tenders in March. However, this can only cover the primary 3.5 km of the whole project. “If we want the project to work, we have to start small,” Arkhom said.
Last 12 months, Thailand said it will finance the project itself, focusing solely on the 250-kilometer stretch between Bangkok and the northeastern city of Nakhon Ratchasima, after failing to agree loan rates of interest with China.
Arkhom said the remaining 620km route was still into account. “As promised, we must keep this project alive, although there may be some delays.”
Negotiations regarding Chinese loans are also continuing. The latest agreement stipulates that China will lend money for imported materials on the Bangkok-Nakhon Ratchasima section. The rate of interest, nonetheless, remains to be higher than rates offered by other financial organizations equivalent to the Asian Development Bank, he said, with the last offer being 2.3% for loans in yuan or US dollars.
Additionally, Arkhom said China is requesting rights to develop land along the railway line, in addition to permission for China to acquire concessions for other development projects in Thailand should the railway project fail. “We disagree,” Arkhom said. “The project is located in Thailand and we have exclusive rights to it. They cannot benefit from the project.”
Source : http://asia.nikkei.com/
