Archaic railway network seeks investors to put it back on track

APART FROM HAVING the two largest populations in the world, China and India have another major item in common - a superb network of railways.

The government-owned Chinese rail system, with more than 73,000km of track, moves 1.2 billion people and two billion tonnes of freight annually. There is one major problem, however: it is overstretched and antiquated, and in some instances obsolete.

The need of the hour is a comprehensive overhaul of the entire national railway network. The mainland authorities have tried to attract overseas investors to help expand its secondary and tertiary lines, while the state keeps control of major trunk routes.

Foreign investment in the Chinese rail system has been restricted to single lines and special services. A Japanese consortium tried rail-freight leasing in the 1990s, but it proved uneconomical.

Orient Overseas Container Lines (OOCL) managed to find a profitable niche in the late-1990s, by joining hands with the China Railway Container Transport Centre to launch a reefer (refrigerated) rail service between Xian, in Shaanxi province, and the port city of Qingdao.

This was followed by a service between Shanghai and the capital of Sichuan, Chengdu. The double initiative provided an intermodal service that opened up two major inland cities that could not be reached by feeder vessels.

Dairy products, eggs, seafood, meat and poultry could then be shipped, in addition to chemicals and biological materials. Nevertheless, the service remains strictly regional in scope; and there is nothing comparable at the national level.