High-speed rail puts China back on fiscal track

But not everyone is convinced about the debt levels and safety, writes Keith Bradsher.

China began service on Boxing Day on the world's longest high-speed rail line, covering 2298 kilometres in just eight hours.

Bullet trains travelling 300km/h began regular service between Beijing and Guangzhou, the main metropolis in south-eastern China. Older trains still in service on a parallel rail line take 21 hours.

Completion of the Beijing-Guangzhou route is the latest sign that China has resumed rapid construction on one of the world's largest and most ambitious infrastructure projects, a network of four north-south rail routes and four east-west routes that span the country.

Lavish spending on the project has helped jump-start the Chinese economy twice: in 2009, during the global financial crisis, and again this northern autumn, after a brief, sharp economic slowdown over the summer.

The hiring of as many as 100,000 workers for each line has kept a lid on unemployment even as private-sector construction has slowed because of limits on real estate speculation. And the national network has helped reduce toxic air pollution in Chinese cities and curbed demand for imported diesel fuel, by freeing up capacity on older rail lines for goods to be carried by freight trains.

But the high-speed rail system has also been controversial in China. Debt to finance the construction has reached nearly 4 trillion renminbi ($620 billion), making it one of the most visible reasons total debt has been surging as a share of economic output in China, and approaching levels in the West.

Each passenger car taken off the older, slower rail lines makes room for three freight cars because passenger trains have to move so quickly that they force freight trains to stop frequently. But although the high-speed trains have played a big role in allowing sharp increases in freight loadings, the Ministry of Railways has not yet figured out a way to charge large freight carriers, many of them politically influential state-owned enterprises, for part of the cost of the high-speed lines, which haul only passengers.

The high-speed trains are also considerably more expensive than the heavily subsidised older passenger trains. A second-class seat on the new bullet trains from Beijing to Guangzhou costs 865 yuan ($133), compared with 426 yuan for the cheapest bunk on one of the older trains, which also have narrow, uncomfortable seats for as little as 251 yuan.

Worries about the high-speed network peaked in July last year, when one high-speed train ploughed into the back of another near Wenzhou in south-eastern China, killing 40 people.

A subsequent investigation blamed flawed signalling equipment for the crash. China had been operating high-speed trains at 350km/h, and it cut the top speed to a new rate in response to that crash.

The crash crystallised worries about the haste with which China has built its high-speed rail system. The first line, from Beijing to Tianjin, opened a week before the 2008 Olympics; a little more than four years later, the country has 9349 kilometres of high-speed lines.

China's aviation system has a good international reputation for safety and its occasional deadly crashes have not attracted nearly as much attention. Transportation safety experts attribute the public's fascination with the Wenzhou crash partly to the novelty of the system and partly to a distrust among many Chinese of what is perceived as a home-grown technology, in contrast with the Boeing and Airbus jets flown by Chinese airlines.

Japanese rail executives have complained, however, that the Chinese technology is mostly copied from them, an accusation that Chinese executives have denied.

The main alternative to trains for most Chinese lies in the country's roads, which have a grim reputation by international standards. Periodic crashes of intercity buses kill dozens of people at a time, while crashes of private cars are frequent in a country where four-fifths of new cars are sold to first-time buyers, often with scant driving experience.

Flights between Beijing and Guangzhou take about three hours and 15 minutes. But air travellers in China need to arrive at least an hour before a flight, compared with 20 minutes for high-speed trains, and the airports tend to be farther from city centres than the train stations.

Land acquisition is the toughest part of building high-speed rail lines in the West because the tracks need to be almost perfectly straight, and it has been an issue in China as well. Although local and provincial governments have forced owners to sell land for the tracks, there have been disputes over suddenly valuable land near railway stations; the result is surprisingly few stores and other commercial venues have sprung up around some high-speed stations through which tens of thousands of travellers move every day.

Zhao Xiangfeng, a farmer in Henan province, said a plan to build a mini mall on his and six other farmers' land near a station had been shelved after he and three of the other farmers refused to lease the land for a pittance. He said he worried that local leaders might try to force them to lease the land and revive the project.

The southern segment of the high-speed rail line, from Guangzhou as far as Wuhan, has been open about three years and already suffers from congestion, which could limit the number of seats available for travel to Beijing during peak hours. Regular travellers say the 800-seat trains are often sold out as many as 10 trains in advance on Monday mornings and Friday afternoons, even though the trains travel as often as every four minutes.