China turns to US$503bil rail expansion to boost growth

BEIJING: China plans to spend 3.5 trillion yuan (US$503bil) to expand its railway system by 2020 as it turns to investments in infrastructure to bolster growth and improve connectivity across the country.

The high-speed rail network will span more than 30,000 km under the proposal, according to details released at a 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% of major cities in China.

The plan will see high-speed rail lines across the country expand by more than half over a five-year period, a boon to Chinese suppliers of rolling stock such as CRRC Corp and rail construction companies including China Railway Construction Corp and China Railway Group Ltd.

Earlier this year, China turned to a private company for first time to operate an inter-city rail service on the mainland, part of President Xi Jinping’s push to modernise the nation’s transport network amid slowing growth in the world’s second-largest economy.

China will also add 3,000 km to its urban rail transit system under the plan released yesterday.

At the end of 2015, China had 121,000 km of railway lines, including 19,000 km of high-speed tracks, according to a transportation white paper issued yesterday.

The US had 228,218 km of rail lines as of 2014, according to latest available data from the World Bank.

The Chinese government will invite private investment to participate in funding intercity and regional rail lines, Yang Yudong, administrator of the National Railway Administration, said at the briefing. – Bloomberg