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Thailand's $7bn rail project draws 31 local and foreign bidders

Companies likely to form joint ventures for Eastern Economic Corridor link

Workers build a road in front of U-Tapao airport, south of Pattaya City in the Eastern Economic Corridor. (Photo by Takaki Kashiwabara)

BANGKOK -- Thirty-one companies from Thailand and abroad have expressed interest in bidding for the right to build the country's first high-speed railway, which will link three major airports.

"This shows that the high-speed train project is much-awaited ... [and] has interested many Thai and foreign companies. I am surprised there are some Asian companies joining the bidding, particularly from South Korea and Malaysia," said Pairin Chuchotethavorn, Thailand's deputy minister of transport.

The State Railway of Thailand, the state-owned railway operator, is overseeing the bidding process. Between June 18 and July 9, a total of 31 companies bought the document outlining the terms of reference for the project.

There are 14 Thai companies considering a bid, along with seven Chinese companies, four Japanese, two French, two Malaysian, one Italian and one consortium from South Korea, according to a statement from SRT.

Among the Thai bidders are well-known conglomerates, such as food processor Charoen Pokphand Group and BTS Group Holdings, which operates Bangkok's Skytrain elevated railway. 

Multinational corporations, including Japan's Hitachi and SNCF, the French state-owned railway operator, have also expressed interest. Chinese bidders include China Resources and China Railway

Germany's Siemens and Bombardier of Canada, two companies that had showed interest earlier this year, withdrew from the bidding.

According to SRT, officials from the Eastern Economic Corridor, an investment zone, and the railway operator will meet with representatives of the 31 bidders on July 24 for a briefing. SRT will also conduct a tour of construction sites on July 26. The deadline for submitting bids is Nov. 12.

Sources at the Transport Ministry said they foresee fewer than the original 31 prospective bidders to submit documents. "We expect some firms will join together and set up joint ventures or corporations to make it easier, in terms of financial structure, to bid for the project," said a person familiar with the process who declined to be named.

The winner is to be announced in December, with construction scheduled to start in early 2019, according to SRT.

Map of Railway

The 220km route will connect Suvarnabhumi, Don Mueang and U-Tapao airports, the first large infrastructure project to be built in the Eastern Economic Corridor. The rail project, estimated to cost 225 billion baht ($7.07 billion), will shorten travel time between Bangkok and the corridor to less than one hour.

Thailand's National Legislative Assembly approved rules in February placing the zone under civilian law, a move aimed at reassuring foreign investors that the corridor, which spans the eastern provinces of Chonburi, Rayong and Chachoengsao, will remain even if the junta led by Prime Minister Prayuth Chan-ocha is replaced.

Other big projects in the corridor include expanding the ports of Laem Chabang and Map Thaput, developing U-Tapao airport and building maintenance facilities near the airport through a joint venture between Airbus and Thai Airways International. All five projects will be financed through a mix of public and private investment.

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