A train undergoes a trial run along the Shanghai-Kunming railway line, which links the coastal city with Southwest China's Yunnan Province. Photo: IC

A new high-speed railway line linking China and Thailand, as part of the Trans-Asian Railway (TAR), could be a catalyst for regional economic cooperation in the years to come, experts said.

Earlier in June, the Thai government granted approval to a $23.3 billion high-speed railway project that will link Thailand's capital Bangkok and Kunming, capital of Southwest China's Yunnan Province, the Bangkok Post reported on July 30.

Wang Mengshu, a member of the Chinese Academy of Engineering, was cited by a Beijing Times report on August 4 as confirming the report and saying that the railways were part of the 3,000-kilometer-long TAR system, which will be further extended to link Singapore in the future.

The construction of the two routes will begin in 2015 and are expected to be completed by 2021, the Bangkok Post report said.

The routes are still under discussion, but a Thai transport official said the railway will have to be operated at a speed of 160 kilometers per hour, whereas China's high-speed railway system runs at 250-300 kilometers per hour, media reports said.

Regional cooperation

The railway project is one of several initiatives proposed by China to enhance regional economic cooperation, with a slew of plans being announced in recent years. These include a $31.5 billion China-Pakistan economic corridor and an economic belt along the Silk Road, a trans-Eurasian project that involves over 40 countries and 3 billion people across the continent.

Long Yongtu, chief negotiator for China's WTO accession, said at a forum held in Kashgar, Northwest China's Xinjiang Uyghur Autonomous Region, on July 27 that regional economic cooperation has been the prevailing theme of world trade during the past decade and is gaining more momentum, noting that it contributes to regional stability.

Yi Peng, chief researcher on urbanization with Beijing-based think tank Pangoal, noted that the construction of the railway is a process during which the rail engineering standards of Association of Southeast Asian Nations (ASEAN) countries will match China's, unleashing great potential.

"Although its speed is limited to 160 kilometers per hour, the railway line has great potential considering its future extension to Singapore, Myanmar, and Vietnam," Yi told the Global Times Friday.

Zhou Fangyin, a professor with Guangdong Research Institute for International Strategies, said Thailand features several advantages that led to it being the first ASEAN country to begin the high-speed railway project.

"Thailand is a regional economic power, has the region's second-largest population, and has always been a peninsula traffic hub thanks to its geographic position," Zhou told the Global Times Thursday, noting that Thailand's per-capita GDP is closest to China's among ASEAN countries.

Zhou said infrastructure, when laid down, creates new demand.

"The railway will benefit Thailand economically as the high-speed railway network further facilitates the flow of people, goods, capital and ideas," Zhou noted, saying the railway will strengthen Thailand's status in the region.

China is Thailand's largest trading partner, and exported $8.72 billion worth of goods to Thailand in the first three months of 2014, according to a Ministry of Commerce report in May.

China's top exports to Thailand in the first half of 2014 are electrical machinery, machinery and home appliances. Thailand's top exports to China are rubber, chemical materials and cassava products.

On the Chinese side, Yunnan Province, as one of the terminals of the railway, will be able to upgrade its status to a regional hub, though this will lead to competition with neighboring Guangxi Zhuang Autonomous Region, which has traditionally played a bigger role in China's relationship with ASEAN countries.

Customs data shows that the trading volume between Yunnan and ASEAN members reached 39.86 billion yuan ($6.48 billion) in the first half of 2014, while Guangxi's trade with ASEAN countries topped 55.77 billion yuan. Trade with ASEAN countries accounted for about half of the total foreign trade volume of the two.

Railway technology for rice

China leads the world in high-speed railway development, having about half of the world's total high-speed rail mileage, according to a report by Xinhua News Agency in March 5.

China's operational high-speed rail lines totaled 11,028 kilometers in length, with another 12,000 kilometers under construction by the end of 2013, the Xinhua report said.

The construction of the China-Thailand high-speed railway line is another "go-out" experience for Chinese technology, according to media reports.

China and Thailand will each be responsible for the railway sections lying within their respective national borders, according to Wang.

However, China will provide the technical teams and equipment to Thailand and in exchange, Thailand will provide rice to China, Wang said.

The technology export indicates China's technological advantages and cost competitiveness, Yi said.

"High-speed rail is to China what watches are to Switzerland, electric appliances to Japan, and machinery to Germany," Wang told the Global Times in an interview in November 2013, underlying China's leading technology in tunneling, rail, and bridge construction.

"Making infrastructure investments overseas also helps relieve the overcapacity issue in China," Yi said. "A lot of Chinese companies can weather the country's transformation period by getting involved in these projects."

Chinese Premier Li Keqiang first introduced China's high-speed railway technology during a state visit to Thailand in October 2013.

Outlook

Both Thailand and China's Yunnan are renowned for their well-developed tourism industry.

In 2013, 4.7 million Chinese tourists visited Thailand, figures from the Thailand tourism authority showed.

Yang Liqiong, a researcher with the Beijing-based China Tourism Academy, said the railway could further boost tourism growth, as Yunnan and Thailand compliment each other in terms of the resources offered.

"The railway provides another alternative for tourists, on top of air and road traffic, and will definitely boost cross-border travel between Yunnan and countries on the Indochina peninsula," Yang said. 

"A network formed by high-speed railways narrows the distance between people, physically and physiologically. It binds together the fate of countries in the region," Zhou said.

The free flow of goods and people in the region can be as powerful as the signing of a regional free trade agreement and more benefits will appear over the long term, Zhou noted.