The government will double its budget for infrastructure development over the next seven years to 4 trillion baht, Deputy Prime Minister and Minister of Finance, Kittiratt Na-Ranong says.
Transport Minister Chadchat Sittipunt answers questions from the media about the plan to build four high-speed railway lines and 10 new regular railways.
The cabinet on Wednesday endorsed a master plan to develop various infrastructure projects over the next seven years. The plan will allow the Finance Ministry to borrow 2.2 trillion baht for the projects.
Mr Kittiratt, however, said that sum will only be enough to finance major transport routes within the master plan.
The government will need another 2 trillion baht to finance the rest, he said.
He said, however, the remaining 2 trillion baht for the master plan would come from the regular fiscal budget and will not have to be borrowed.
Transport Minister Chadchat Sittipunt said logistic costs stand at 15.2% of gross domestic product (GDP).
The infrastructure development plan will eventually help lower the cost to 13.2% of GDP.
He said reducing overall logistic costs will make Thailand more competitive with Singapore, which has logistics costs at 9% of its GDP, and Malaysia (13%).
The Transport Ministry has been asked to organise public hearings and presentations on the projects at the government complex on Chaeng Watthana Road from next Thursday to March 10, he said.
After the cabinet endorses the master plan, the Finance Ministry will work on a bill to borrow 2.2 trillion baht to pay for the projects.
The ministry will propose the bill to the cabinet in mid-March and it should reach parliament within two weeks.
"The prime minister has ordered transparent implementation [of the projects] and there must be explanations [of how the money is spent]," Mr Chadchat said.
The infrastructure projects will improve national transport and improve links with neighbouring countries, the minister said.
The projects include four high-speed railways and 10 electric railways in Bangkok and nearby provinces.
Mr Chadchat said the endorsed transport strategies do not include air transport projects because the government could depend on investment by Airports of Thailand Plc.
The 2.2 trillion baht borrowed will be spent in 300-billion-baht increments each year of the plan, he said.
"The borrowing will be included in public debt but the government will cap it at 50% of GDP," he said.
The infrastructure projects would boost GDP by 1%, create 500,000 jobs and increase inflation by 0.16% annually, he said.
Deputy government spokesman Pakdiharn Himathongkham said the approved infrastructure development plan includes a 309.6-billion-baht strategy to promote alternatives to road travel; a 954.7-billion-baht plan to develop national and regional transport networks; and a 672.5-billion-baht strategy to improve transport in key urban and economic areas.
About 63.17 billion baht is set aside as a contingency reserve.
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Writer: Wichit Chantanusornsiri & Chatrudee Theparat