China is accelerating the pace of building high-speed rail links in the central and western regions in a bid to reduce the country’s oversupply of steel and cement, the 21st Century Business Herald reported.
“These regions are relatively underdeveloped in terms of infrastructure, and they don’t have the financial capability to build these rail links in the short term,” an industry insider was quoted as saying. “Therefore, the government will let China Railway Corp. to build these railways in the first place, although these links may not make profit in the near future.”
Premier Li Keqiang said earlier this month that railways in central and western China would support economic restructuring and boost people’s income amid the relatively low prices of raw materials, the report said.
China has raised fixed-assets investment in railways this year to over 800 billion yuan (US$129 billion) from an original target of 630 billion yuan. New approved projects have also increased to 64 from 44 previously.
In June, China Railway Corp. started implementing 14 projects with a combined investment of 327 billion yuan.
The construction boom is also benefiting companies such as China South Locomotive and Rolling Stock and China North Locomotive and Rolling Stock Industry. They are expecting to win a massive order for locomotives worth 55 billion yuan, the report said, citing a company source.
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