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June 22, 2011

China High Speed Rail Debate

1. China daily has a debate about high speed rail in China.

Against more high speed rail is the need for more freight rail capacity

Low population density is a serious problem that development of high-speed railways in the western region faces.

Considering its price and speed, high-speed railway is more competitive than flights for short distances, say between 300 and 800 kilometers, but less attractive for passengers who travel more than 1,000 km. For instance, Urumqi, the capital of the Xinjiang Uygur autonomous region, is 3,100 km away from Beijing and 2,500 km from Xi'an. There is no reason why businesspeople and tourists would choose high-speed railways over planes, because it would demand more time and higher costs.

What the western region needs most is not high-speed railway, but simply more freight trains. The biggest obstacle for people in the west is inferior means of freight transportation. The money spent on a high-speed railway linking the west to the rest of the country can be used to build at least two double lines on the same route, which would remove the bottleneck that freight transportation faces and integrate the region into the country's wider market.



Pro-high speed rail

Over the past three decades, China has relied heavily on exports through the sea for its economic development. With factories, manufacturing plants and other facilities concentrated in the coastal region, the economic and social gaps between China's eastern and western region have increased further, creating a regional imbalance that is rare in the world

The introduction of high-speed railway to the western region could tackle both these problems. An upgraded transportation system would help China develop industries in the west, exploit the vast Eurasian market and lessen its reliance on exports through the sea.

Faster connectivity would shorten the distance between sources of energy and industries, too, reducing transportation losses considerably. A better developed economy will help the west attract more people and strengthen national security along China's long borders with other countries.

The railway lines will help places like Xinjiang build an economy with external links, too, by developing labor- as well as technology-intensive industries and exploiting the neighboring markets.

The western region will be able to spread its influence to neighboring countries once industries develop there. If China invests as much in the west as it did in Shenzhen or Shanghai decades ago, another economic miracle could be created in the next 20 years.

Once the west develops, China will have balanced regional urbanization. Northwestern provinces have the best natural conditions to exploit solar and wind energy, which, combined with the large swathes of non-arable land, can offer the best option for low-carbon urbanization - and a new land utilization mode will be created in China.

2. The New York Times writes a mostly pro-high speed rail in China article

High-speed trains were making it more convenient to base businesses here in Hunan Province — a populous region that has long provided labor to the factories of the east, but whose mountain ranges have tended to isolate it from the economic mainstream.

Mr. Zhen ticked off Hunan’s economic attributes: “Land is much cheaper. Electricity is cheaper. Labor is cheaper.”

Throughout China, real estate prices and investments have risen sharply in the more than 200 inland cities that have already been connected by high-speed lines in the past three years. Businesses are flocking to these cities, now just a few hours by bullet train from China’s busiest and most international metropolises.

Meanwhile, a shift in passenger traffic to the new high-speed rail routes has freed up congested older rail lines for freight. That has allowed coal mines and shippers to switch to cheaper rail transport from costly trucks for heavy cargos.

Because of this shift, plus the further construction of freight rail lines, the tonnage hauled by China’s rail system increased in 2010 by an amount equaling the entire freight carried last year by the combined rail systems of Britain, France, Germany and Poland, according to the World Bank.

Among the biggest beneficiaries of the high-speed rail system are companies that contribute nothing to defray its costs. Those would be freight shippers, which now have more exclusive use of the older rail lines, with fewer delays.

On the older tracks, the rail ministry has long been able to dictate that freight rates would subsidize passenger trains because the ministry owns those older tracks outright. The new, high-speed lines — passenger trains only — are owned by joint ventures between the ministry and provincial governments. That has prevented the ministry from forcing freight shippers to cross-subsidize the new high-speed services. As a result, passengers must pay much higher fares on the new trains than on the older ones.

China has not disclosed any fatal crashes since its high-speed rail network began operations three years ago, while nearly 100,000 people a year die on Chinese roads, according to official statistics. International health experts say that the true total for road deaths is even higher.

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