Thai railway project offers cautionary tale

Thailand has reportedly decided to solely fund the construction of a 250-kilometer high-speed railway between Bangkok and the city of Nakhon Ratchasima.

This was intended to be the first section of a planned 845-km high-speed railway running from the Thai-Laos border to Thailand's industrial seaboard, for which a Chinese loan had been agreed after nine rounds of painstaking negotiations between Beijing and Bangkok over two years.

Thai Transport Minister Arkhom Termpittayapaisith said on March 25 that China should offer "friendship" terms on the interest rate of the loan and project costs. He suggested the interest rate should be reduced from 2.5 percent to 2 percent, the same rate China offered Indonesia last year for a high-speed rail project, and China bear the bulk of the costs as the project is of benefit to it.