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September 05, 2013

China's High speed rail network is paying off and is a key part of future development

Yichuan Wang (undergraduate economics and mathematics student at the University of Michigan) makes the case that China's high speed rail development strategy is working (Quartz article)

* Passenger usage intensity of the rail network has increased by 50% from 2001 to 2011
* high-speed rail has allowed more trains to be placed on the same length of tracks without overcrowding.
* average daily ridership on the high-speed rail network has hit 1.33 million daily passengers—more than one-fourth of the total number of passengers on the rail system.
* efficient high speed freight is enabling the development of inland areas
* daytrips for business enable more high value added service industry (consulting or finance) activity
* the Tourism industry makes up 10% of employment in China, and its direct and indirect effects add up to around 14% of China’s GDP (pdf). Since tourism depends on cheap travel, high-speed rail could play a pivotal role in fostering this industry. There has been 20% growth where high speed rail lines are added.
* high speed rail in more environmentally friendly than air travel

The NY Times in an article about the floundering economy in India works in praise of China's high speed rail infrastructure

Poor infrastructure has also driven up costs for industrial real estate in India, which are high compared with China’s. Just in the last five years, China has opened 5,800 miles of high-speed rail routes and 400,000 miles of highways of two or more lanes. That has allowed tens of thousands of factories to move to smaller towns in the interior with much lower land costs.



Nextbigfuture has previously noted studies which show that the high speed rail network will boost GDP growth in China

High speed rail seems to be providing a 1.0 to 1.5% annual GDP boost to regional economies.

The recent statistics show that the high speed rail network is boosting the economy.

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