The project to link Yunnan’s capital of Kunming with the Lao-Thai border was originally touted as a high-speed service. Mr Devakula said Thailand had initially asked for a track capable of accommodating high-speed trains, but had been persuaded medium speed was better by China.
Explaining the rationale behind the decision to opt for slower trains, the deputy PM said the Chinese wanted standard gauge tracks capable of carrying goods trains. The about turn on a high-speed rail link is seen as a blow to China’s ambitions of being the economic powerhouse in this region of Asia.
Some finance industry analysts also say that the failure of China and Thailand to seal a deal on finance derailed the high-speed ambitions. The Export-Import Bank of China offered to finance the project, but at interest rates Thailand has stated are too high.
Kunming to east Thailand rail link project downgraded
News in Asia
A senior Thai government minister says China has downgraded its plans for a rail link from Yunnan Province to Nong Khai. Deputy prime-minister Pridiyathorn Devakula told media sources in Hong Kong this week that China was now looking at a line that could accommodate medium speed trains.