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China: Rail Development To Be
"Catalyst Of Development"

China's State Council has approved 2 trillion yuan ($292 billion) for the construction of a series of railway projects, to help boost economic growth amid the worldwide financial crisis, China Daily reported Oct. 25. "Increasing investment in fixed assets has remained a catalyst of China's economic development," the article stated.

Ministry of Railways spokesman Wang Yongping said Oct. 24 that a number of rail projects will soon be launched, and that 1.2 trillion yuan had already been allocated for these projects for the period 2006-10. "New rail investment will become a shining light in efforts to push forward economic growth," Wang Yongping was quoted by the Beijing News. China's total rail network will be 90,000 km long by 2010, from its 2006 size of 76,600 km, the Ministry of Railways has announced - a big increase, since rail building has been much slower in recent years. As of 2006, China was planning expansion to 100,000 km of railways by 2020, 12,000 of this high-speed passenger lines. This goal has now been enlarged, to have 120,000 km of rail lines by 2015, with 20,000 of it high speed lines where passenger trains can run at up to 200 km per hour. Annual spending has been increased about 2.5 times to meet this goal.

Senior government policy adviser Zheng Xinli said: "In 1997, we dealt with the Asian financial crisis by stimulating domestic economic growth by investing in the construction of highways. This time the money will go on improving the rail network." He said that the National Development and Reform Commission, the economic planning institution of China, is developing plans to improve the country's railway systems.

China's rail capacity is severely overburdened: most rail capacity still is used for transporting coal, the main source of energy, around China. In addition, China has a migrant labor force of at least 200 million people, and when this huge number of people return to rural areas, such as at the New Year holiday, the passenger system cannot cope.

On Oct. 16, the Ministry of Railways floated its second set of 10- and 15-year bonds this year. The National Development and Reform Commission has allowed the Rail Ministry to issue 80 billion yuan of bonds in 2008, for 31 rail construction projects and buying locomotives.

BusinessWeek reported Oct. 23 that "China is now undertaking the world's biggest railway expansion since the U.S. laid its transcontinental line in the 1860s."

Among projects launched this month, are a high-speed passenger rail line linking Beijing to Shijiazhuang, capital of Hebei Province, and further to the Yangtze River port city Wuhan. These rail lines are part of a new 2,300-km route to connect Beijing with Guangzhou, Shenzhen and Hong Kong in south China. Another newly begun project will link Guilin, capital of the poor, interior Guangxi Zhuang region in the southwest, to the coastal Guangdong Province. Another new rail line will connect Lanzhou, Gansu province and a key city on the Euro-Asian Continental Bridge, to Chongqing, the biggest city in central China. Chongqing already has a new rail link to Guiyang.

The Yangtze River Delta region will build five new rail lines, to link Shanghai, Nanjing and Hangzhou, and the Shanghai-Nantong and Ningbo-Taizhou-Wenzhou railways.

Another even greater project, is also being planned. On Oct. 9, the Urumqi Railway Burean announced that Xinjiang is planning to build nine, 2,000 km railways to link Xinjiang to the rest of China and to the rest of Asia by 2020. The projects include a China-Kyrgyzstan-Uzbekistan railway, a China-Pakistan railway and seven railways to link Xinjiang to Inner Mongolia, Qinghai and Gansu provinces, Xinhua quoted Wu Jian of the Urumqi Railway Bureau. Xinjiang only opened its first rail line in 1962, and now has over 3,000 km of rail. The key line is the Euro-Asian Continental Bridge, which connects China to Kazakhstan, Russia, and Europe.

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