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Japan, South Korea, China All Compete for Thailand High Speed Rail

The auction for the construction of the first high-speed rail in Thailand, worth approximately 154.2 billion yuan (US$25.31 billion), has drawn competitive bids from China, Japan and South Korea.

According to our sister paper, China-based China Times, Chinese Premier Li Keqiang's mid-October visit to Thailand has been described as a diplomatic trip for promoting China's high-speed rail technology.

The total length of the high-speed rail network in China is more than 10,000 kilometers. The Chinese government now aims to build a pan-Asia railway that connects Singapore, Malaysia, Thailand, Vietnam and Laos.

Located in the central area of the pan-Asia railway, Thailand plans to release bids for its first high-speed rail line in the second half of 2014. It is speculated that China's chances of winning the auction are high, owing to China's commitment to importing more rice from Thailand.

However, Thai officials have hinted at competitive bids for the construction from Japan, South Korea and France as well. Among the competitors, Shinkansen by the East Japan Railway Company (JR-East) may be China's strongest contender. China has an advantage, in that its high-speed rail is supported by the government, which implies that in order to win the bid, China can sweeten the deal with other concessions to Thailand.

However, in recent years, Japan has increased its investment in Thailand, with its total investment reaching 74.6 billion yuan (US$12.2 billion) in 2012. JR-East has previously won an urban railway construction in Bangkok earlier, worth US$400 million.

Compared to China's railway technology, JR-East, which has expanded exports of railway infrastructure, has an edge in terms of quality.

Following the corruption case against Liu Zhijun, former minister of the Ministry of Railways, and the June 23 Wenzhou train collision in 2011, China has become more conservative in terms of exporting its rail technology. However, as Chinese top leaders have proactively promoted their high-speed rail technology overseas on various occasions, the Chinese government appears to have decided to strengthen its efforts to promote high-speed rail export