China readies $22b rail plan

BEIJING -- China said yesterday it will spend $22 billion to build two of the world's most ambitious railway projects -- the nation's second magnetic levitation train and a high-speed railway linking Beijing and Shanghai.

The disclosures had been eagerly awaited by European and Asian makers of railway equipment, which are looking to China for potential sales as the government pushes ahead with plans to add thousands of miles of high-speed lines to its network.

But China did not say what role foreign suppliers might play.

The 820-mile Beijing-Shanghai link will use wheeled trains traveling at up to 220 miles per hour, said the country's top industrial planning agency, the Cabinet's National Reform and Development Commission.

The disclosure did not say when the line would be built or give a cost. But the official Xinhua News Agency said Railway Minister Liu Zhijun put the price last week at $17.5 billion.

Japan lobbied China to use its Shinkansen bullet train technology for the line, while France pitched its TGV system and Germany tried to sell its maglev technology.

But China said it wants to build the line with domestic technology adapted from systems overseas. The commission said the Beijing-Shanghai project would be built and operated by a corporation financed by Chinese and foreign investors.

The 110-mile magnetic levitation, or maglev line, from Shanghai to the nearby city of Hangzhou is due to be completed by 2010 at a cost of $4.3 billion, Xinhua reported.

The world's only commercially operating maglev train, built with German technology, links Shanghai's main airport with its financial district. Maglev technology uses powerful magnets to suspend a train above a track and propel it at speeds of up to 260 miles per hour.

China is in the midst of the world's biggest burst of railway construction, adding thousands of miles every year.