On February 7, 2019, sources from the Ministry of Transport revealed that progress on the high-speed railway project from Bangkok to Nakhon Ratchasima, under contract 2.3 for rail systems, electrical systems, and machinery, including the procurement of trains and training of personnel, with a budget of approximately 40 billion baht, has advanced significantly. Negotiations have progressed on specifications, contract value (BOQ), technology transfer, and personnel development. However, a major issue remains unresolved, preventing the Cabinet from approving the project, and there is still no clarity on whether a contract can be signed during the Thai-Chinese railway cooperation committee meeting scheduled for February 26-28 in Beijing.

 

          A critical issue is the negotiation regarding the insurance for the high-speed trains, which the Chinese side has only offered for one year. This is unacceptable because global train manufacturers typically provide a two-year warranty as per international standards, given that these are high-tech products with significant value. There is a risk of losing tens of billions of baht if issues arise later, especially since Thailand currently lacks sufficient capability to manufacture and assemble high-speed trains. The insurance should cover all damages, including spare parts, vehicle systems, repair costs, internal equipment, and accident insurance for passengers in case of mishaps.

 

          Therefore, if the negotiating party does not extend the warranty period, signing the contract will not be possible, and negotiations with the China Railway Design Corporation (CRDC) and China Railway International Co., Ltd. (CRIC) must be canceled. Subsequently, negotiations will begin with new manufacturers under the government-to-government (G2G) cooperation agreement. Initially, the Chinese side has not raised objections, but negotiations must continue.

 

"High-speed trains are like buying a car. If there is only a short-term warranty, it carries risks. They claim the product is good, yet offer such a short warranty. We ask, if it’s truly good, why not provide a two-year warranty? Just like cars, the more expensive they are, the longer the warranty should be," a source stated.

 

In light of reports that technology transfer and personnel development for high-speed rail in neighboring countries have resulted in locals only being able to serve as assistants, sources indicated that this situation would not occur in Thailand, as the country is the project owner, fully funding it with national budget without any exchange proposals. Therefore, Thailand can set conditions for the contracting party regarding personnel development. However, after signing contract 2.3, Thailand will proceed to establish a Thai-Chinese high-speed railway management organization, which will take about one year for study, waiting for structural work to be completed in another 2-3 years before entering the system installation phase and training personnel in technology, high-speed railway management, specialized expertise, and system operation and maintenance, with a total of 720 personnel to be developed.

 

          Reports from the Ministry of Transport indicate that the Chinese side has proposed a loan interest rate of less than 3% to Thailand. A decision will be made on whether to use domestic or foreign loans. Meanwhile, adjustments to construction plans to use concrete in certain sections have resulted in an additional investment of 3 billion baht over a distance of 60 km, including 1. the Bang Sue-Don Mueang section, 2. areas around Bang Sue station, Ayutthaya, Saraburi, and Pak Chong, and 3. the entire tunnel section.

 

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