BANGKOK: Thailand's plans for a new US$7.4 billion high-speed rail that will connect three airports from Bangkok to the tourist town of Pattaya got the go-ahead on Thursday (Oct 24) after months of negotiations that spilled over into public acrimony.
The Thai government said it had signed an agreement on Thursday to begin construction with a consortium led by conglomerate Charoen Pokphand (CP) Group and including China Railway Construction Corporation.
Some Japanese banks have also agreed to provide part of the financing for the link, which will span 220km and is scheduled to start operating in 2023.
The high-speed rail will shuttle passengers from Bangkok's main airport Suvarnabhumi to Don Muang airport - another airport in Bangkok used by low-cost carriers - and Pattaya's U-Tapao airport in under an hour at maximum speeds of 250kmh.
The high-speed line will also serve as a link to the Eastern Economic Corridor (EEC), an ambitious US$50 billion scheme seeking to attract investment from industries like auto and tech manufacturing.
Construction will begin in 12 to 24 months and the government is footing 65 per cent of the 224.5 billion baht deal.
After the 50-year project period, all assets will be transferred to the government.
Chinese embassy officials say it will play a key role in Beijing's massive Belt and Road initiative.
CP Group and 12 other companies were selected for the project by Thailand's former military government. They have been in negotiations with state agencies since a new government came to power after elections in March but there have been disputes about land transfers and the distribution of risks.
In early October, Deputy Prime Minister Anutin Charnvirankul, whose party is in charge of the transport portfolio, set a deadline for signing the agreement to start construction, threatening to blacklist the CP consortium if they failed to so.
CP Chairman and Thailand's richest man, Dhanin Chearavanont, criticised the government's approach to the project in a dispute with Anutin over the delay in signing the agreement.
However, as the deadline closed in CP announced it would sign the agreement a day early on Oct 24.
"This project will have investments and employment with a total value of more than 200 billion baht," Anutin wrote on Facebook adding that it would attract more investment to Thailand.