China Looks to Rails to Carry Its Next Economic Boom

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Source: New York Times

From one end of the country to the other, China is in the midst of a railroad boom that promises to transform the world’s third-largest economy, after those of the United States and Japan. By making it easier to move people and goods, the railroad mania will gradually shift the center of economic gravity inland, accelerating the development of central and western China in an echo of America’s experience in the 19th century.

Taking freight and passenger traffic together, China already has the world’s busiest railroad system. But measured by the size of the country and the needs of 1.3 billion people, the system is puny. The density of the network, measured in kilometers of line per million inhabitants, is less than a tenth of those in Russia, the United States or Canada, a seventh of the European Union’s and about a third of Japan’s, according to the World Bank.

This sparse network, totaling 86,000 kilometers, or 54,000 miles, at the end of 2009, is so overburdened that it carries a quarter of the world’s rail traffic on about 6 percent of the world’s lines. The economic case for expanding the rail network is clear-cut. During a country’s development phase, total demand for transportation tends to grow faster than income.

But some critics say China is putting too much emphasis on high-speed rail lines capable of accommodating speeds of as much as 350 kilometers an hour. China already has the longest operational high-speed network in the world, at 6,552 kilometers, and it intends to double that total to 13,000 kilometers by 2012 by upgrading existing track and building new lines.

Read more: http://www.nytimes.com/2010/04/13/business/global/13inside.html