A good rail network enables the convenient exchange of products from one country to another. But one of the biggest issues Southeast Asia is facing is the lack of proper rail infrastructure and maintenance of certain rail networks in many of its countries.
This issue hinders a lot of transactions happening in Southeast Asia on a regular basis which slows down the expected rapid growth. Due to this, the need for a development on the rail networks is now being raised.
Areas that require rail network development
The three main areas of rail network lack include Vietnam, Indonesia and Thailand. Vietnam requires an upgrade in its rail network which currently consists of only seven lines, that are only single track each. As of now, there is no railway service or infrastructure between Vietnam and Cambodia or Laos.
Access to Indonesian cities has been difficult due to the road congestion that the country is experiencing. It is being said that the country’s annual growth is largely hampered due to inadequate rail infrastructure and network. Thailand also suffers from a similar issue due to low investment budgets in Its rail infrastructure, restricting cross country transport and placing undue stress on its capital, Bangkok.
Current rail projects
Solutions planned to address rail network issues involving extensive investment and planning are currently underway.
Here are some of them:
- A high speed rail system from Jakarta Surabaya. Its first phase, ie: from Jakarta and Bandung was launched in 2016 and is worth USD 5.5 billion
- An electric train that runs between the important cities of Kanchanaburi, Bangkok and Aranyaprathet. Also in the process is the dual tracking of all country railroads.
- A railway system between China, Singapore and all mainland Southeast Asian nations known as Kunming Rail
- A high speed rail system between Singapore and Kuala Lumpur
Kuala Lumpur - Singapore high speed rail project
Following the project’s announcement in February 2013, there was a request for project ideas sent out in October 2015. 14 companies and consortiums offered their unique concepts for developing the Kuala Lumpur to Singapore high speed rail system. In 2016, the plans have been formalised and we will be seeing construction beginning in 2017 to be completed by the year 2022. The estimated value of this project is SGD 14.8 billion.
Railway development plans to boost the Southeast Asian economy
There are plans laid out by the government of each nation towards developing their railway network in an attempt to boost their individual economies.
The Singaporean government plans to build the current metro system is a step in the right direction to position the city-state as a transport and business mecca. SMRT has allocated a sum of SGD 900 million towards this initiative. Malaysia’s massive urbanisation movement via the 2014 Economic Transformation plan to emerge as a developed economy by the year 2020 presents a host of investment opportunities. The Thai government on the other hand, is aiming for economic growth through investments and by opening up channels for international participation.
Hence, Southeast Asia’s railway network enhancement plans aim to improve local economy while presenting numerous opportunities for global companies to get involved. For detailed information about each project, it would be beneficial to obtain market research reports on the specific regions.