China plans to spend 3.5 trillion yuan (US$503 billion) to expand its railway system by 2020 as it turns to investments in infrastructure to bolster growth and improve connectivity across the nation.
The proposed high-speed rail network expansion will span more than 30,000 kilometers, according to details released at a Chinese State Council Information Office briefing in Beijing yesterday.
The distance, about 6.5 times the length of a road trip between New York and Los Angeles, will cover 80 percent of major cities in China.
Photo: Reuters
The plan will see high-speed rail lines across the nation expand by more than half over a five-year period, a boon to Chinese suppliers of rolling stock such as CRRC Corp (中國中車) and rail construction companies, including China Railway Construction Corp (中國鐵建) and China Railway Group Ltd (中國中鐵).
Earlier this year, China turned to a private company for first time to operate an inter-city rail service on the mainland, part of Chinese President Xi Jinping’s (習近平) push to modernize the nation’s transport network amid slowing growth in the world’s second-largest economy.
The plan will also see China add 3,000 kilometers to its urban rail transit system.
At the end of last year, China had 121,000 kilometers of railway lines, including 19,000 kilometers of high-speed tracks, according to a transportation white paper issued yesterday.
The US had 228,218 kilometers of rail lines as of 2014, according to the latest available data from the World Bank.
The Chinese government will invite private investment to participate in funding intercity and regional rail lines, National Railway Administration director Yang Yudong (楊宇棟) said at the briefing.
Further rail investments will be made in the poorer western cities despite unprofitable operations, Yang said.
“We believe these railway lines will break even over time as the flow of people and goods experience fast growth,” he said.
The government plans to “adjust” fares to ensure rail businesses nationwide are viable, he said, without elaborating.
The rail reforms, including raising ticket prices and allowing private investment, would help ease some financial burdens of state-run China Railway Corp (中國鐵路).
The rail operator incurred an after-tax loss of 5.57 billion yuan in the first nine months of this year and its liabilities totaled 4.29 trillion yuan as of Sept. 30, according to its third-quarter audited report.
The company spent more than 600 billion yuan on rail-related infrastructure in the past two years.
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