Hanoi (VNS/VNA) - The State must play a key role in investing in the national railwayinfrastructure to boost development and attract more private investment,experts have said.

Speaking at the seminar on promoting the railwayinfrastructure development held on September25, Deputy Minister of Transport NguyenNgoc Dongsaid the cost of investment in a kilometre of railway infrastructure is usuallythree to four times higher than that of roadway. 

In addition, the sector had a slow pay-backability making it tough to call for investment from private sectors.

Dong said the sector has improved with theinvestment in the North-South high-speed railway, which helped to maximise thecapacity of the transport system in Vietnam.

However, the aging and backward infrastructuresystem has posed many challenges.

Most of the trains operated on the one metregauge, which accounted for 85 percent of the national railways.

There were 297 terminals in the whole country,but most were small and downgraded. Half of 1,850 railway bridges were in direneed of being upgraded. At least 22 out of 39 railway tunnels also needrenovation.

More than 4,000 railway crossing wereillegally built across the country, where up to 70 percent of railway accidentsoccurred.

Vu Anh Minh, Chairman of the Vietnam Railways Corporation, said the capital demand for railway development was huge, but the investmentfor the sector was modest - only two percent of the State budget.

The annual funding for maintenance allocatedby the Government could only satisfy about 30 percent of the actual needs.

Out-of-date technology and ill-qualityservices weakened the competitiveness of the sector, he said.

Le Thanh Van, Standing Member of the National Assembly'sFinance and Budget Committee, said the railway sector has lost its role inthe economy with the market share decreased from 30 percent to 1 percent.

This was totally contradictory to thedevelopment of roads and airways, he said.

Discussing on the causes of the issue, Vansaid the State has not had a strategic vision of railway planning and paidlittle attention to investment. 

On the other hand, the railway industry itselfstill depended on the State’s investment and was not active in restructuringits organisation to adapt to fierce competition.

That’s why it was very difficult to attractinvestment from the private sectors.

Le Thanh Quan, Director of the Ministry of Planning andInvestment’s Department of Infrastructure and Urban Development, said the funding raised from 4 percent in the period of 2011-2015 to 11.9 percentin the period of 2016-2020.

However, it has remained insufficient to theactual demand.

Due to limited investment, the developmentstrategy of the national railway industry by 2020 with a vision to 2050 onlytargeted that the market share of the industry would be 1-2 percent ofpassenger transport and 1-3 percent of freight transport.

At the meeting, experts said it was vital theState invest in key infrastructure.

A policy to attract investment from privateenterprises should be built.

The transport sector must focus on technologyto lengthen station tracks, build new stations, synchronise axle load on theentire route and modernise signalling and telecom systems to improve theoperation capacity./.