No.385issue(2012.08.10) |
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China Gets Aboard Europe's High-Speed RailsSHANGHAI—Beijing-based China CNR Corp. said it had secured a small but important components order from Germany's Siemens AG that represents a rare Chinese foothold in the Western market for high-speed trains, a year after a deadly accident cast doubt on industry integrity. The 91 million yuan ($14 million) order includes lengths of aluminum alloy to be fashioned as the roofing, floors and walls of high-speed passenger rail cars. "It's the first time China CNR will export key components for high-speed trains to Europe," said a CNR executive.
China considers to try more financing vehicles for railway constructionFeeling the pressure of railway construction financing difficulties, China is trying more ways to fund railways projects. An railway expert revealed that the Ministry of Finance has begun the modifications of regulation on railway construction funds, aiming to broad the fund base. Joint venture railways might also be levied, while the current fund is only levied on state-owned railways. According to the report, China is also considering to permit projects including inter-city railways,urban rail transit projects to issue private placement bonds. But Zhaojian, an economy professor in Beijing Transportation University worries about the expansion on fund levy base, "Some joint venture railways are already suffering massive debts and interest payment, it's not reasonable to levy fund on them. " "On the other hand, this policy may keep private capitals away from railway construction," Zhao said. As for inter-city railways, the Ministry of Railways has handed them to local government. To collect money, some local governments are still relying on local government funding vehicle, which is more and more risky since the year 2009. With pressure imposed on local government and banks, the central government is considering more ways to finance railway projects, and private placement bond is one of new ways. But according to the expert, the bonds issuance may not be successful since both issuing and buying sides will have to consider the high interest rate and the undesirable cash flow in urban rail transit projects. At the end of June, People's Bank of China for the first time stated in the report of China's monetary policy implementation in the second quarter of 2012 "to provide capital for major continuation projects including railways". According to Wang Mengshu, deputy chief engineer at the China Railway Tunnel Group, banks have eased credit of railway construction, but the Ministry of Railway has been more cautious on borrowing, considering it's high debt ratio of more than 60 percent. The key issue for China's railway system is to seperate administration from management, if this problem can't be solved, social capitals still won't enter in,Wang said. According to Wang, NDRC has just set up a research project to make detailed regulations to protect interests and rights of private investors in transportation investment.
Daqin Railway sees sharp decline in share pricesShares in Daqin Railway Co, China's largest provider of railway coal transportation, have seen a double-digit decline in the last two months, which is largely a result of the sluggish coal market, industry insiders said Thursday. Shares in Daqin Railway closed at 6.06 yuan ($0.95) Thursday, a decline of 0.16 percent from the previous day, and a drop of 17.32 percent compared with two months ago. A slump in demand for coal amid the recent economic slowdown has led to a drop in rail freight demand, which has affected the railway company's stock performance, industry watchers said. Daqin Railway is one of China's most important coal transportation railways. It connects Datong in North China's Shanxi Province, the country's major coal production area, with the port of Qinhuangdao in North China's Hebei Province, the country's largest coal port. "The daily coal transportation volume by Daqin Railway to the port declined by around 20 percent over the last two months," An Zhiyuan, the information director of the official website of Qinhuangdao Ocean Shipment Coal Market affiliated to Qinhuangdao Port Co, told the Global Times Thursday. The port has also witnessed a dramatic increase in coal stockpiles over the past months, according to An. The total transportation volume for Daqin Railway's top five customers, which are all large-sized companies such as Chinacoal Pingshuo Group, accounted for 34 percent of its total sales volume in 2011, according to the freight company. The other customers are mostly small-sized coal distributors, who are experiencing difficult times because of the drop in demand. "Last year, the small-sized coal distributors had to compete to apply for Daqin Railway carriages. But recently, Daqin Railway has had to ask the coal distributors whether and when they need railway wagons," Li Chaolin, a coal and energy industry analyst at Henan Shenhuo International Trade Ltd, told the Global Times Thursday. Rising imports due to a drop in international coal prices have added to the sliding transportation volume for Daqin Railway, said Lin. Daqin Railway's stock price was 7.57 yuan per share in late May, when the National Development and Reform Commission and the Ministry of Railways raised national average rail freight prices by 0.01 yuan per ton per kilometer to cover increased transportation costs.
Risky defects found on 12 rail lines in ChinaChinese Ministry of Railways has found quality defects on 12 rail lines that may endanger railroad safety, according to a document recently obtained by the media. Seven of the 12 lines have been put into service, including high-speed passenger railways between Wuhan and Guangzhou and between Zhengzhou and Xi'an, according to the document. The problems were discovered during routine inspections. The construction defects on the seven lines included cracks and leaks on tunnel arches, tilted communications towers and poorly arranged electronic cables, the Chinese news portal eeo.com.cn reported recently. Other problems were found on five lines currently under construction, including one linking Lhasa and Xigaze in the Tibet autonomous region, which is an extension of the Qinghai-Tibet railway. The ministry severely criticized some contractors for building with low-quality materials and not using enough iron bars in reinforced concrete. Media reports quoted anonymous experts as saying the defects might threaten railway safety. Cracks on the railway tunnel's arch could cause concrete chunks to break off when a high-speed train passes, destroying the train's power supply equipment, they said. A ministry official who spoke to China Daily on the condition of anonymity confirmed the authenticity of the document, saying it was meant to be circulated inside the ministry and to relevant parties. He said the ministry is paying great attention to quality issues, and has organized regular inspections on railway construction and operations. "It is just another regular checkup to guarantee railway safety," he said. According to the document, the ministry has already taken measures to punish those responsible for the quality defects. It suspended several construction and construction supervision companies from tendering and bidding on railway projects for a month, and required them to rectify the problems as soon as possible. Wang Mengshu, an expert on railway tunnel construction at the Chinese Academy of Engineering, said he has not seen the document, but knew that holes had been found in the arches of railway tunnels on the Wuhan-Guangzhou passenger line and the Zhengzhou-Xi'an line. A cavity in the tunnel arch could cause it to collapse. "These problems will not affect the operation of the entire line but need to be fixed," he said. "People around me are expressing worries over taking high-speed trains after reading the news," said Sun Pengwei, a resident of Fuzhou, Fujian province, who travels twice a month on the Fuzhou-Xiamen high-speed line — one of the defective railways. "Although no accidents have occurred on the line, I hope authorities can make sure that there are no hidden risks." The public has the right to know any safety threats in the railway system, and authorities should make such information more transparent, he said. Zhao Jian, a professor at Beijing Jiaotong University, said some major railway contractors tend to subcontract minor projects to smaller companies to save money and meet tight deadlines. In February, Sheng Guangzu, minister of railways, said railway construction was a field that needs stringent supervision on quality, work safety and officials' behavior. The ministry recently announced details of disciplinary violations of former minister Liu Zhijun, who made huge illegal profits by helping others bid for several railway projects, including high-speed railways, Chinese media reported.
China to export high-speed train parts to EuropeA Chinese train maker said Wednesday it will sell components to German engineering giant Siemens, in what will be the first time Chinese high-speed train parts have been exported to Europe. The deal, reportedly worth more than 11 million euros ($13.6 million), will see parts including some aluminium-alloy car bodies shipped to Europe, said an official with the state-owned China CNR Corporation Limited. He said it marks the first time that such Chinese train parts will be exported to the continent. "(Siemens) will place more orders as long as the first order passes their checks," said the official, who declined to be named. "They are likely to make China a regular supplier of such parts." China has built the world's largest high-speed rail system from scratch in less than a decade, but the railway ministry has been accused of overlooking safety in its rush to develop the country's vast transport network. The Beijing News reported Wednesday that, according to an agreement signed in April, a subsidiary of the Chinese company was to produce high-speed train parts worth 11.55 million euros for Siemens this year. Officials at Siemens in Beijing were not immediately available for comment when contacted by AFP Wednesday. The train car bodies are "one of the nine key technologies" in the manufacturing of high-speed trains as there are strict requirements for the welding of aluminium alloy to achieve precise sizes, said the CNR official. The reputation of China's high-speed trains was tarnished after a bullet train collision in July last year near the eastern city of Wenzhou killed at least 40 people and injured hundreds. In the weeks following the accident, authorities announced a halt to new train projects and introduced new speed restrictions on bullet train lines. An accident report released late last year blamed design flaws and poor management for the crash, which sparked public fury and worries over the safety of the nation's rail system. China Accelerates Railway Investment in July; Indicates Boost to EconomySHANGHAI--China has accelerated its investment spending in the railway sector, according to data released Thursday from the Ministry of Railways, in a fresh sign that the country is carrying out more measures to overcome the persistent downward pressure on the economy. Fixed-asset investment by the ministry in the first seven months of this year fell 30% from a year earlier to 225.71 billion yuan ($35 billion), according to a statement on its website. Of the total amount, infrastructure investment declined 34% to CNY188.44 billion. The data compares with a 36% decline in fixed-asset investment in the January-June period and a 39% fall in infrastructure investment, indicating that the ministry last month sped up its investment in the railway sector. The latest data come after the Chinese government last month quietly increased this year's budget for railway investment. In the railway ministry's latest bond prospectus published July 30 on Chinabond, an official website for debt issues, it detailed plans to spend CNY470 billion on infrastructure investment this year, up from the CNY406 billion stated in a June prospectus. The revision was widely seen by economists as part of China's effort to boost growth, which slipped to 7.6% in the second quarter--its slowest pace in more than three years. At a recent meeting of senior Communist Party officials and prominent figures from outside the party, Premier Wen Jiabao reiterated promises of an array of measures to support economic growth--including spending plans, tax breaks and monetary policy support. On Thursday, China said its July consumer inflation eased to a low of 1.8% in two-and-a-half-years, with analysts saying this will give the government further leeway to loosen monetary policy to boost weakening growth.
Nepal: SAARC-China Cooperation in Infrastructure, looking at Rail Connectivity In this context it would be germane to mention plans between India and Nepal to establish direct rail links that connect Raxaul in Bihar with Kathmandu and Nautanwa in Uttar Pradesh with Lumbini (the birth place of Lord Buddha) in Nepal. Currently there is only one railway track between the two countries linking Janakpur in Nepal with Jainagar in Bihar. The plans to connect Raxaul and Kathmandu by way of an 80 km rail link would also incorporate Birguni and Hetauda in Nepal which are important industrial and trading centers of Nepal, while the distance to be covered between Uttar Pradesh and Lumbini would be only about 25 kilometers (Das, 2004). This may be significant because during the recent visit of India Prime Minister Mon Mohan Singh to China, it will be recalled that India and China signed a Memorandum of Understanding (MoU) for cooperation and development of rail related programs between the two countries. The agreement includes programs of mutual interest, consultations, training and visits to each other’s facilities” (I Government Bureau, 2008). It seems there may be potential implications of this agreement for Nepal, not the least of which is the proposition that Nepal-as some analysts have already suggested-can serve as a transit state between India and China, and the other very promising tourism implication on account of Chinese, Indian, and international tourists or pilgrims deriving from the special Buddhist train, or Mahaparinirvan Express, launched last year by the Indian Railways (especially relevant given the great resurgence of Buddhism in China). So Nepal, perhaps as part of a wider SAARC effort for regional railway connectivity stitching together specific sites of Buddhist history and culture, and obviously as an over-arching measure to substantially enhance commercial and economic transactions, can at some point become integral to any relevant cooperation between Indian and Chinese Railways. Such an effort would be timely, as discussions will also soon commence between India and Nepal on the proposed expansion of the broad-gauge railway from Jogbani (in Bihar, India) to Biratnagar (in eastern Nepal), a short distance of some 8 kilometers (South Asian Media Net, 2008), while both official and unofficial discussions have continued to take place between Nepal and China on the Tibet railways extension to the border of Nepal itself. According to media reports, Indian Railways is “keen on cooperation with its [China] counterpart for raising speed on existing routes, development of world class stations, heavy haul operations, and development of multimodal logistics parks and research and development”(iGovernment Bureau, 2008). China Railways has vast experience being the carrier of the highest volume of freight traffic in the world, and the substantial network expansion it has undertaken combined with impressive modernization and technological up-gradation seen in the last 10 years in the areas of signaling and telecommunications, traction supply, high axel load operation, design and maintenance and multimodal transport, makes it an invaluable resource for not only India but other relevant South Asian countries as well (ibid). With respect to railway extensions to take place between India and Nepal-and in the context of the Tibet railway’s expansion to the Nepal border in the near future-I believe Nepal should carefully study the recently inked MoU between India and China railways to understand how it may seek the assistance of its two neighbors, each with its own long history in railroad transportation, to develop its own railway system, initially in such a manner that will link China’s railway to India’s via Nepalese territory in a way that a solid foundational framework for Nepal railways can be established fairly soon upon which ancillary networks across Nepal can be built over time. This will achieve a feat the vision for which dates back to 1885 or perhaps earlier to efforts and explorations of the British Royal Geographical Society for establishing a railway connection between India and China (Hallett, 1885). There is no doubt the idea of such a connection would be still more intriguing and truly historic if its execution could be ensconced within the parameters of a China-SAARC cooperation for common prosperity initiative. Cooperation in Infrastructure Development must be People-Focused: A section of the commentary on existing infrastructure cooperation between China and specific South Asian states is cast in sort of global geo-strategic terms, but the problem with this line of approach is that it fails to address ways in which actual people on the ground may be positively ( or negatively) affected. Whether the overall sovereign interests of a particular state are achieved or enhanced by the development of infrastructure across two (or a group of) states is certainly a valid line of inquiry in real-politic terms, but the limitations of such traditional strategic assessments may be understood more clearly by identifying the deficiencies of an analysis that merely takes into account the interests of states per se. Positive results of cooperation between multiple states in infrastructure development have been witnessed very recently close to the South Asian region itself, with the inauguration on March 31 2008 of the spectacular “North-South Economic Corridor” that will connect by highway the southern Chinese city of Kunming to Bangkok in Thailand, spanning a distance of some 1800 kilometers. This highway and its ancillary network of roads that fed into it are “breaking the isolation of the thinly inhabited upper reaches of Laos, Myanmar, and Vietnam, areas in recent decades [that] languished because of wars, ethnic rivalries and heroin trafficking” (Fuller, 2008). This highway will now provide further impetus to the increased trade between China and the Southeast Asian countries of Cambodia, Vietnam, Laos and Thailand that has risen from $5.7 billion a decade ago to $53 billion in 2007 (ibid). The North- South Economic Corridor has been a remarkable Greater Mekong Sub-region (GMS) flagship program. In thinking about future joint infrastructure initiatives between China and South Asian states, we must recognize how this particular GMS program has benefited (and will continue to benefit) so many people on the ground as a result of other initiatives that have followed (and will follow) because of the way in which transportation has been dramatically enhanced. For example, consider the GMS program for improving telecommunications infrastructure in all six member countries; financing and laying down transmission lines in Cambodia, Laos and Vietnam; programs for assistance in management, entrepreneurship, skills training, business development, production and marketing, and finance for small and medium sized enterprises (SMEs); and cooperative arrangements for addressing health issues (such as HIV/AIDS), education and labor sector issues (Sotharith, 2007), to mention just a few examples. The laying down of roads and railways that effectively connect a region no doubt creates a multiplier effect in the range of services, initiatives and opportunities they can bring in their wake that should not be underestimated in terms of how especially poor and less-advantaged people on the ground stand to benefit. In South Asia, the inauguration in Pakistan in March 2007 of the Port of Gwadar, which was constructed with substantial Chinese investment, unfortunately attracted some skeptical and negative attention in the international media, with analysis focusing heavily on geo-political ramifications, yet the full benefits of the Gwadar Port to South Asia as a whole and to China (and even Central Asia) have not been sufficiently articulated in the context of promotion of common prosperity. As a matter of fact, the potential that Pakistan has seen in the Port all along dates back decades when geo-strategic constellations were perhaps in an entirely different order than they are today: in fact, it all started with the recommendation of Worth Condrick who was deputed by the US for survey of Balochistan coast in 1954. “Realizing [the] importance of Gwadar, Pakistan paid [approximately] Pound Sterling 3 million in September 1958 to buy back the enclave from the Sultanate of Oman ending over 200 years of Omani control. Since then the history of decision making process for its development has been that of studying, planning, shelving, restudying, re-planning and waiting and hoping for some outside aid agency to finance the project”(Daily Dawn, 2008). The Gwadar Port, of course, is located on the southwestern coast of Pakistan, close to the Strait of Hormuz through which passes 30% of the world’s daily oil supply at the intersection of the oil-rich Middle East, heavily populated South Asia and the resource laden region of Central Asia. The port is expected to generate billions of dollars of revenue and generate at least two million jobs, and it has spurred the development of other infrastructure projects such as the 700km Makran Costal Highway which has reduced travel time to Karachi from 48 hrs to 7 hrs and is expected to connect to Iran in the near future. Moreover, the Civil Aviation Authority of Pakistan has set aside 3000 acres of land for the Gwadar International Airport and the Pakistan government is also focusing on the laying of the Havelian-Kashghar (China) and Quetta-Kandhar (Afghanistan) railway tracks. It should be mentioned that Pakistan has declared Gwadar a “Special Economic Zone” where banks, hotels, factories, and warehouses will be established. There have been concerns about the exclusion of ethnic Baluchus in the course of these developments yet it cannot be realistically implied that the establishment of such important infrastructure in Baluchistan signifies this ethnic groups’ perpetual exclusion from the derivative benefits emerging from these massive (and varied) infrastructure works. In different ways and from different channels, the Port of Gwadar (as a joint project of China and Pakistan) will undoubtedly benefit countless numbers of people across the spectrum and most significantly perhaps those at the bottom rung of society. The benefits of the Port of Gwadar to my own country, Nepal, especially to the northwestern parts of the country which are the most backward and poor, can be achieved by cooperation between Pakistan, China and Nepal, by way of the Karakoram Highway, via the Xinjiang-Tibet Highway and connecting by road to a number of districts such as Humla, Mugu, Dolpo and so on. This would inject massive stimuli to these destitute and marginalized areas in Nepal and thereby generate incredible transformations economically and socially. Moreover, connectivity to northwestern Nepal can simultaneously occur from India as well, so as to accelerate interaction between the Indian states of Uttarakhand, Uttar Pradesh, western and northwestern Nepal, and the Tibet Autonomous Region, a proposition that is very much consistent with the notion of Nepal serving as a transit-point for rapidly expanding India-China trade. This sort of planning may even be augmented, supported or coordinated with the United Nations Economic and Social Commission’s ongoing work related to the Asian Highway project, the members of which include virtually all South Asian states with the exception of the Maldives. UNESCAP, SAARC, and China could think of ways in which to partner in this endeavor. This may also be one way of institutionalizing within the framework of China-SAARC relations, infrastructure cooperation to promote greater connectivity and common prosperity. It must be reiterated, however, that success in the achievement of a proposition such as this (which would help to uplift from poverty many thousands, even millions of people) requires a change in the mode of strategic assessment/planning by states that are accustomed to thinking more about (the safeguarding or promotion of) overall national power, sometimes at the expense unfortunately of people on the ground who would stand to benefit otherwise.
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Brazil court bans light rail vehicle systemA federal court has banned the construction of a planned light-rail system in a World Cup host city in Brazil. The federal prosecutor's office in Mato Grosso state said Wednesday on its website that investigators found "irregularities in the choice of the system and in the viability of the project." Prosecutors say there is no way the system can be ready for the World Cup games scheduled in 2014 for the state's capital city of Cuiaba in west-central Brazil. The state government had originally chosen a rapid transit bus system, but then decided to use light rail vehicles. Prosecutors say that change would have led to a 57 percent rise in annual operating costs. The Mato Grosso World Cup organizing committee was not immediately available for comment.
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Ex-minister’s case nears endThe Ministry of Railways recently announced details of disciplinary violations by former railway minister Liu Zhijun, who was expelled from the Communist Party of China (CPC), according to media reports. The ministry made the internal announcement on Friday, reported caixin.com. The report said the announcement details Liu's disciplinary violations on bribe-taking, political and ethical misconducts, many of which are closely linked to Ding Shumiao, an executive of the Beijing Boyou Investment Management Corp. Liu, 59, took advantage of his position to help Ding make huge illicit gains, the caixin.com reported. The assets of Ding's company soared from 474 million yuan ($74 million) in 2008 to 4.5 billion yuan in 2010, the Xinhua News Agency reported earlier.
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