Construction of a US$7 billion (270 billion baht) railway linking Vientiane to the Laos-China border will start next year and is scheduled for completion in 2018, state media reported on Friday.
Deputy Public Works and Transport Minister Lattanamany Khounnyvong said Laos and China were ``ironing out the details of the loan agreement with the EXIM Bank of China, to cover the cost of construction,'' said the Vientiane Times.
Laos will soon choose a Chinese contractor to build the rail link.
The 420-kilometre railway project was initially to be done as a joint venture between China and Laos, but will now be 100% owned by the Lao government. The project got the go-ahead from the National Assembly last month.
On Nov 5, the Lao government also signed a 30-year concession with Malaysia's Giant Consolidated Limited to build a 220-kilometre-long train track linking Savannakhet province to Vietnam.
Construction of that railway line is scheduled to begin in January, to be completed within four years. The project will cost an estimated 5 billion dollars.
The China-Vientiane railway project will use a standard-gauge track of 1.435 metres and require the construction of 76 tunnels and 154 bridges.
Mr Lattanamany said a project feasibility study of the proposed route had already been completed.
Plans to build the railway as a China-Laos joint venture ran into opposition as the agreement required handing over vast tracts of land to the Chinese contractor as part of the deal.
The government of Laos has set the goal of turning itself into a ``land-linked'' country with its neighbours with railways.