Meeting Domestic and International Transport Needs
On the afternoon of February 10, 2025, the National Assembly Standing Committee reviewed the investment policy for the Lao Cai – Hanoi – Hai Phong railway project.
Minister of Transport Trần Hồng Minh stated that, based on political, practical, and scientific foundations as well as domestic and international contexts, the pre-feasibility study report has clarified the necessity of this investment.
Specifically, the project aims to realize the guidelines and orientations of the Party, Resolutions and Conclusions of the Party Central Committee and the Politburo; implement planning strategies; strengthen strategic cooperation and international connectivity; and meet transportation demands along the Lao Cai – Hanoi – Hai Phong economic corridor, thereby supporting socio-economic development.
The project also contributes to restructuring the transportation sector according to the advantages of each mode of transport, reducing logistics costs; generating a construction market, laying the foundation for the development of the railway industry and supporting industries; developing a sustainable, modern, environmentally friendly transport method; reducing traffic accidents and environmental pollution; adapting to climate change; and ensuring national defense and security.
“The goal is to construct a modern, synchronized new railway line to meet domestic and international transport needs between Vietnam and China; to create a significant driving force for rapid and sustainable socio-economic development; to fully leverage the advantages of the Lao Cai – Hanoi – Hai Phong economic corridor; and to ensure effective connectivity with national and international railway networks, in line with national defense, security, environmental protection, and climate change adaptation, while promoting the country’s industrialization and modernization process,” Minister Minh emphasized.
According to Minister Minh, the main line will start at the rail connection point between the new Lao Cai station and the Ha Khau North station (China), and end at the Lach Huyen port area, passing through 9 provinces and cities. The main route will span approximately 390.9 km, with three branch lines totaling about 27.9 km.
The project will involve the construction of a new electrified railway with a standard gauge of 1,435 mm, used for both passenger and freight transport. The design speed of the main line from the new Lao Cai station to Nam Hai Phong station will be 160 km/h, the section through Hanoi’s central area will be 120 km/h, and branch lines will be designed for speeds of 80 km/h. Land clearance for the main route will follow a double-track configuration, with initial investment in a single-track system.
In terms of technology, centralized power trains will be used for both passenger and freight services, and the information and signaling systems will match those used on other mixed-use railway lines in the region.
The total estimated land requirement is about 2,632 hectares, with an estimated 19,136 people subject to relocation. “The preliminary total investment is around VND 203.231 trillion (approximately USD 8.369 billion). To ensure flexibility in financing, the proposed funding sources include the state budget (central and local), domestic sources, foreign sources (such as Chinese government loans), and other lawful funding sources,” Minister Minh stated.
The feasibility study will be conducted starting in 2025, with the goal of substantially completing the project by 2030.
Unlocking New Economic Development Opportunities
Minister Minh emphasized that the project will provide substantial economic benefits: laying a foundation for national development in a new era, enhancing national competitiveness, meeting transportation needs, restructuring the sector to maximize the advantages of each transport mode, opening up new economic development spaces and resources through efficient land use, promoting construction and railway industries and supporting sectors, and stimulating urban development, tourism, and services. It will also help reduce pollution, traffic accidents, and create employment.
In its project review, Vũ Hồng Thanh, Chairman of the Economic Committee, affirmed the necessity of investing in the project, citing sound political, legal, and practical bases as outlined in Proposal No. 69/TTr-CP.
The project aligns with the national socio-economic development strategy, master plan for 2021–2030 with a vision to 2050, the national railway network plan for 2021–2030 with a vision to 2050, as well as regional and provincial planning that has already been approved.
However, the Economic Committee requested clarification on how the project aligns with the national land use planning for 2021–2030 with a vision to 2050, and how land will be allocated and demarcated in provincial plans along the route.
The Committee noted that the project is large in scale and cost. For the 2021–2025 period, about VND 128 billion has been allocated in the public investment plan. For 2026–2030, the required capital is approximately VND 177.282 trillion, and for 2031–2035, about VND 25.821 trillion.
The government proposed utilizing domestic funds, foreign loans, and other lawful sources, along with requesting special mechanisms and policies such as exemption from capital balance assessment under the Law on Public Investment. During implementation, it seeks authorization for the Prime Minister to issue government bonds, raise official development assistance (ODA), concessional foreign loans, use central budget surpluses and savings (if available), and other lawful funds to ensure feasibility.
These special policies have previously been permitted by the National Assembly and approved by competent authorities, making the government’s proposal well-founded. However, during project implementation, macroeconomic balance and public debt safety must be ensured.