Cabinet green lights deal with China on double-track railway from Nong Khai to Bangkok

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CABINET APPROVE
Cabinet green lights deal with China on double-track railway from Nong Khai to Bangkok
Erich Parpart
The Nation

BANGKOK: -- The Cabinet yesterday approved the signing on December 19 of the memorandum of cooperation (MoC) with China for building the Bt400 billion double-track railway from Nong Khai to Bangkok.

The memorandum of understanding on constructing the standard gauge (1.435 metre) railroad was signed on November 25 of last year, under which a joint steering committee was formed.

Eight meetings have led to the second MoU to divide up, in general, the responsibilities for the engineering, procurement and construction work.

The MoC will call for the setting up of the project's SPV.

The 873-kilometre route from Nong Khai province to Map Ta Phut in Rayong and on to Bangkok would mainly carry freight trains running at 160-180km per hour. The focus is linking trade, services and goods transportation in Asean.

Construction was planned to commence on October 23, but was delayed when both sides remained divided on the construction costs for the four-phase project.

"The signing of the MoC will signal the tangible development of the project," government spokesman Sansern Kaewkamnerd said.

"However, no information on the interest rate for the loan and the budget for the project has been announced, since the two parties still cannot agree on some of the costs," he added.

Transport Minister Arkhom Termpittayap said in September that both sides differed on the costs of at least two phases. One quote from Beijing was 30 per cent above estimates. Projecting financing was another sticky issue.

Prime Minister Prayut Chan-o-cha also instructed Somkid Jatusripitak, his deputy in charge of economic affairs, during the Cabinet meeting to follow up on and accelerate the development of the infrastructure fund to help with the financing of various infrastructure projects next year.

The Cabinet also gave the nod to the Board of Investment (B0I) and the Finance Ministry to provide import duty, excise and value-added tax exemptions for testing and prototyping vehicles in the country. The measure would promote foreign investment in automobile testing facilities in the Kingdom.

Expenses for research and development as well as the production of test or prototype vehicles can be used as a deduction for corporate income tax.

The Revenue Department will be in charge of selecting firms that will be approved for the benefits and monitoring the vehicles from the day they enter the country to the day they are destroyed.

The beneficiaries are businesses dealing in the research and development of automobile performance and manufacturers supplying test vehicles for researchers.

Another condition is that the vehicles must have never been registered or sold in Thailand.

The Cabinet also approved in principle the Industry Ministry's proposal to identify "10 industries for the future". They have the potential to become the country's new economic growth engines.

They include five existing industries that will be further supported including the automobile of the future, smart electronics, quality tourism, agriculture and biotechnology along with food for the future.

The five new industries are robots for manufacturing, logistics and aero industry, energy and biochemical, digital economy along with the medical and health industry.

The industries will be granted BoI privileges, while the Finance Ministry is considering more tax incentives and the setting up of a joint venture fund with the private sector to support the 10 industries' R&D programmes.

Source: http://www.nationmultimedia.com/business/Cabinet-green-lights-deal-with-China-on-double-tra-30273173.html


-- The Nation 2015-11-18

[zaphod reborn]

All the kickbacks are now in place, so the MOU can be signed. Amazing that they can sign an MOU when the total construction price and interest rate on the loan are still in dispute, but the only thing that matters is the kickbacks anyway.

[yellowboat]

All the kickbacks are now in place, so the MOU can be signed. Amazing that they can sign an MOU when the total construction price and interest rate on the loan are still in dispute, but the only thing that matters is the kickbacks anyway.

Yes, Juntas like elected governments in Thailand, all look out for themselves and their cronies while the average Thai struggles.

Thais that have businesses in Hong Kong and China prosper. Perhaps some Thais will have greater opportunities in Kunming.

[trainman34014]

More talk and pieces of paper don't get a railway built ! Lets see some costings that will scare the pants off every Thai participant; like not just construction costs, which are rising with every passing minute but the possible outcome as far as losses for operating such a railway over the next 50 years once it's in use. What are the projected fares for ordinary passengers using these trains, and i say ordinary because all Hi-So's will expect first class gold service for free of course.

If they go ahead with this and other railway building plans the country and its people will be in debt to the Chinese/Japanese for the next 100 years.....all so that a few people with massively inflated ego's can travel for free.

[billphillips]

160 / 180kph trains ..... in Thailand ...... through the central plains and north eastern countryside ....... Hahahahahahahaha.

Has anyone in authority given some thought to the problems this will cause with local people wandering around the track? Perhaps the whole thing will be elevated because no fence will keep them out for long.

[Baerboxer]

EIA's anyone?

[JAG]

One presumes that there will be a similar double track railway line through Laos from China, where all this freight will be coming from, together with a suitable bridge over the River Mekong?

[phoenixdoglover]

18 November 2015 - 400 million project cost mentioned in The Nation article.

Final costs not yet negotiated.

Work packages being discussed and divided.

No worries.

[american12bthai]

THis is bad. bad for the country, bad for the people, bad for the youth.

GREAT FOR BUSINESS!!

but why does thailand want japans help for if chinas going to pay for it... lolol to the future generations of thailand... good luck paying this off after all the "bussinessmen" rape THailands funds.

[halloween]

If on completion the final cost blows out to B700 billion, it will be a far better deal for the Thai people than the rice scam.

[Moruya]

For freight? High speed freight?

[JAG]

For freight? High speed freight?

From Nong Khai?

It can only mean that supplies of Somtam and Plaa Raa in Bangkok are now going to be maintained on a "just in time" basis, with delivery by high speed freight trains.

The paltry investment required will be more than repaid by the reduction of costs associated with bulk storage of these substances in Bangkok.

What's not to like?

[Srikcir]

Cabinet green lights deal ... BUT

"However, no information on the interest rate for the loan and the budget for the project has been announced, since the two parties still cannot agree on some of the costs,"

How can a RESPONSIBLE government "green light " this project with these two key aspects still unresolved? It appears that China is completely controlling this G2G deal. Why would the Thai government concede that ability?

The answer might be a government that has no ACCOUNTABILITY to the Thai taxpayers who will bear a 20-year debt for the project; a government that values propaganda over citizen's interests.

[Eric Loh]

Cabinet green lights deal ... BUT

"However, no information on the interest rate for the loan and the budget for the project has been announced, since the two parties still cannot agree on some of the costs,"

How can a RESPONSIBLE government "green light " this project with these two key aspects still unresolved? It appears that China is completely controlling this G2G deal. Why would the Thai government concede that ability?

The answer might be a government that has no ACCOUNTABILITY to the Thai taxpayers who will bear a 20-year debt for the project; a government that values propaganda over citizen's interests.

There will never be accountability during military rule; period. The NLA is the only platform to question budget spending is now only a rubber stamping stop-over unlike Parliment in during democracy. Loans according to the Budget Procedures Act must be published in the Government Gazette. In this case, the loan amount is still unresolved and not published. And if push hard, the junta like in the Rajabhakti Park will just tell you in the face to stop probing or else...

[american12bthai]

For freight? High speed freight?

From Nong Khai?

It can only mean that supplies of Somtam and Plaa Raa in Bangkok are now going to be maintained on a "just in time" basis, with delivery by high speed freight trains.

The paltry investment required will be more than repaid by the reduction of costs associated with bulk storage of these substances in Bangkok.

What's not to like?

i dont want Chinese poison in my food.

[Stargeezr]

I am seeing a trend. High speed rail from China to Laos, to the bridge north of Nong Khai.

High speed douple rail from Nong Khai to Bangkok in the works. Sounds like the Chinese tourists

will be able to get from China to Bangkok via rail instead of by air. That would be a bit more time, but a

lot cheaper. Heck I would even take that kind of transport if it became available.