Shaanxi railway plans run out of steam

Construction of four intercity railways in Shaanxi Province connecting capital Xi'an with other cities has been suspended as funding runs out.

Photo from CFP

Photo from CFP



Shaanxi Province in northwest China has suspended the construction of four intercity railways connecting its capital Xi’an with other cities.

The decision came after the State Council issued a guideline on railway planning and construction. The guideline pointed out that some regions’ pursuit of high-speed rail neglected actual demand and broke the financial balance of the infrastructure plan.

The major problem for Shaanxi is money. Covering 400 kilometers, construction of the intercity railways started in 2017. Work is about to begin on three high-speed railways connecting Shaanxi with Hubei and Chongqing and there is simply not enough money left to go around.

Local governments are paying more of the costs of railway projects. Last year, Sichuan and Chongqing governments had to pay for over 70 percent of a new high-speed railway connecting the two areas, while the China State Railway Group paid for the rest. But times are not easy for the state railway either. The liabilities of the company are well over 500 million yuan (US$ 85 million). The new guideline requires effective technical and economic assessments while meeting major national strategies.

Apart from the financial crisis, environmental protection is another issue. Shaanxi’s railways run through the mountains and other protected areas. Some have struggled to try to pass the environmental impact assessment.

Last year, the National Development and Reform Commission said a high-speed railway system should be profitable and that a railway system relying on subsidies is unsustainable. According to the new guideline, to operate 350km/h trains, the railway must connect capital cities and transport 25 million people a year. That kind of passenger volume can only be seen in the Beijing-Shanghai or Beijing-Guangzhou railways.

This year, 1,600 kilometers of the high-speed railway will go into operation, less than half of the average of the past five years. The new guideline emphasized the need for general railways and freight transport.