Nguyen Huu Bang, chairman and chief executive officer of Vietnam Railways Corp., said in a recent interview with Kyodo News that he expects the Japan International Cooperation Agency to start feasibility studies on two specific high-speed railway sections in the near future to lay the groundwork for the national project.

The Vietnamese government has expressed its intention to adopt Japan's shinkansen bullet train system for its $56 billion (5 trillion yen) project to build a 1,600-kilometer high-speed railway linking the two cities in as little as five and a half hours.

JICA has conducted a preliminary study as part of a comprehensive survey of Vietnam's overall transport system and says the railway project will be economically feasible on condition that it opens in or after 2036 and urban development along the railway line accelerates, boosting population inflow.

Although the railway project failed to gain majority support from parliament in June, Bang said the government is expected to resubmit it after new leaders of the Communist Party are selected next year.

No official announcement was made by parliament, but Vietnamese national assembly members reportedly were concerned about fiscal sustainability if the project is implemented, as its estimated costs amount to about two-thirds of the nation's current gross domestic product.

The ruling Communist Party of Vietnam is set to hold its national party congress, held every five years, in January to select a new leadership. The high-speed railway is one of the priority projects being strongly pushed by incumbent premier Nguyen Tan Dung.

Bang said he is not discouraged by parliament's request for "more details" of the project and that he expects JICA to closely examine the feasibility of two priority railway sections -- a 295-km section in the north from Hanoi to Vinh and a 362-km section in the south from Ho Chi Minh City to Nha Trang.

He said operations of the two sections can start earlier than the full opening of the entire north-south line in or after 2036.

JICA's feasibility study will provide basic information to the Japanese government in making a decision on whether to extend yen loans for the project.

The head of the railway operator said Vietnam wants to introduce Japanese technology because it intends to adopt the so-called electric multiple unit style, which has been increasingly used for high-speed railway systems around the world including Japan's shinkansen.

Shuji Eguchi, director of the international affairs office at the Japanese transport ministry's railway bureau, said Vietnam "highly evaluates" the safety and punctuality of Japan's shinkansen system. Since the launch of its services in 1964, no accidents involving casualties have occurred.

Eguchi said, however, the Japanese government has not yet officially decided on the start of JICA's feasibility study as Tokyo believes it should not make haste over the railway project, which will be a long-term process.

Although the Japanese government has recently put a focus on exporting its infrastructure systems including the shinkansen to spur its own economic growth, the official of the Land, Transport, Infrastructure and Tourism Ministry said Japan is "not pushing itself" with regard to the Vietnam railway project.

"We need a step-by-step approach. The conventional Vietnamese railway is single track and not electrified yet," he said. "To jump from that stage to the shinkansen, Vietnam needs to train personnel and enact necessary legislation."

The acquisition of the right to use land for the rapid railway system will also be hard work, he added. A new railway must be built separately from the existing line for exclusive use by high-speed trains.

Eguchi said Vietnamese people should first get used to "the railway culture" after the introduction of planned urban train systems in the two major cities in the foreseeable future. At present, Hanoi and Ho Chi Minh City citizens usually get around by motorcycle.

Toshio Nagase, senior representative of JICA's Vietnam office in Hanoi, said not many people currently use railway services for long-distance trips in Vietnam, but that he believes there is considerable demand for speedy train services.

It is considered dangerous to travel by long-distance bus due to bad road conditions on expressways and only a small number of people have their own cars now, he said.

Frequent travelers fly between Hanoi and Ho Chi Minh City because it takes more than 30 hours to travel by the existing train service.

Nagase said fares on the planned high-speed railway services should be kept at around half the airfare to secure enough passengers for profitability.

As for how to finance the project, both Eguchi and Nagase pointed to the difficulty of covering the total costs only with Japanese yen loans and urged Vietnam to raise funds through other tools such as loans from the Asian Development Bank and investments from the private sector.

Nagase said Vietnam Railways should try to secure benefits from businesses other than train services, such as real estate development along the railway route, to improve profitability.

Mainichi Japan / Kyodo News - August 11, 2010