Construction of north-south express railway should to shortened to 16 years: state appraisal council

The North-South Express Railway should be constructed within only 16 years, instead of 30 years as the transport ministry proposed, and could be implemented in the form of a public-private partnership, the State Appraisal Council has concluded.

The council's conclusion on the project's pre-feasibility study has been sent to the Ministry of Transport, the Government Office, and localities where the railway will pass through.

The high-speed railway was proposed by the transport ministry to run 1,559 kilometers, starting at Ngoc Hoi Station in Hanoi and finishing at Thu Thiem Station in Ho Chi Minh City, but the council's report proposed cutting the length to 1,508.6 kilometers.

The council asked the ministry to complete its investment plan for the railway, which will have a double gauge of 1,435 millimeters for carrying both passengers and cargo, and a design speed of up to 250 kph.

Regarding implementation time, the council asked the ministry to accept recommendations made by the project consulting consortium. The consortium argued that the construction time for the railway of up to 30 years as proposed by the transport ministry was too long, which could lead to the risk of investment capital hikes and limit opportunities for socio-economic development.

If preperations for the project runs from 2023-2025, construction time should be cut to 16 years, from 2025-2041. That would help prevent the project from running over budget, it stated.

The consultants also recommended the project be divided into two phases. Phase 1 (2025-2035) will see site clearance on the entire route and the construction of two sections: Ngoc Hoi (Hanoi)-Vinh and Nha Trang-Thu Thiem (HCMC). The total length of these two sections will be about 621.31 kilometers.

Phase 2 (2035-2041) will see the construction of the Vinh-Nha Trang section, 886.75 kilometers long.

According to the transport ministry proposal, the cost of the project would be $58.7 billion if the design and exploitation speeds are 350 kph and 320 kph, respectively. But the council said this faster option would actually cost $64.6 billion.

If the exploitation speed is 160-225 kph, the investment capital proposed by the transport ministry is about $76.39 billion. But the council's calculations show that the figure is only $61.02 billion, down $15.34 billion.

The transport ministry said if the investment is under the PPP model, state capital will account for about 80%, while the private sector will contribute 20%.

Specifically, the state will invest about $50.96 billion. Of this, $38.94 billion will come from the auction of urban land areas at 50 stations along the route, and about $12.01 billion from public investment funds ($8 billion borrowed from domestic and foreign credit institutions, $3 billion in construction bond capital, and $1.01 billion from the central budget).

The private capital involved in the project is about $10.06 billion, which is mainly used to buy locomotives and build elevated stations.

The transport ministry is working on an investment policy for the project that is set to be approved by 2025.

Deputy Prime Minister Tran Hong Ha on April 17 approved plans for policies, solutions, and resources to develop the country’s railway network from 2021-2030, with a vision to 2050, including the integral trans-Vietnam high-speed line.

In early March, the Politburo - the Party’s premier decision-making body - set a target of approving an investment policy for the North-South express railway by 2025, with construction to start before 2030.

The government will submit its investment policy to the National Assembly for approval in the legislative body’s 2021-2026 term. The transport ministry will make feasibility reports, approve the design, complete site clearance, then start a number of bidding packages for the first two sections between Hanoi-Vinh and HCMC-Nha Trang in this period.

The express railway will pass through 20 provinces and cities including Hanoi, Ha Nam, Nam Dinh, Ninh Binh (in the north), Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, Thua Thien Hue, Danang, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan, Binh Thuan (in the central region), Dong Nai, and HCMC (in the south).