Talks between Thailand and China over "Contract 2.3 " of the Thai-Sino high-speed railway project remain inconclusive but are expected to be finalised at an upcoming meeting in China late this month, Transport Minister Arkhom Termpittayapaisith says.
The 179-billion-baht, 252.5 kilometre-long section from Bangkok to Nakhon Ratchasima has been split into 14 separate contracts. Contract 2.3, as it is known, is worth about 38.5 billion baht and involves the tracks, electronics, machinery and procurement of train carriages.
Mr Arkhom said several issues in the contract will have to be ironed out including the warranty period and fines, adding that several Chinese proposals must still be negotiated as no agreement has yet been reached.
According to the minister, China has proposed a one-year guarantee but the Thai side insists on an international standard of two years.
As for daily fines in case of delay, China has come up with 0.0001% of the contract with a 5% ceiling while the Government Procurement and Supplies Management Act of 2017 calls for 0.01-0.1% of contract value with a 10% ceiling.
"We stand by Thai laws in the negotiations. China has made a number of proposals in which China mostly doesn't share responsibility. We can't agree to that so the talks are continuing," he said.
He said "Contract 2.3" is on the agenda of the meeting that will take place from Feb 27 to March 1 between Thai and Chinese authorities in Beijing and is expected to be wrapped up at the meeting. The contract is expected to be signed in March.
On China's loan proposal, he said the Finance Ministry has warmed up to the 25-year loan which calls for a maximum 3% interest with an interest-free period of five years. The Finance Ministry is responsible for negotiation.
Of the 179-billion-baht cost for the first phase, about 13.2 billion baht will be financed by the government's budget and the remaining 166 billion by borrowing.
He said all the remaining contracts involving construction of the first phase are expected to be signed in May.
Currently, a 3.5-kilometre railway from Klang Dong to Pang Asok in Nakhon Ratchasima's Pak Chong district is being built as the first section of the project's first phase. Construction began in December 2017.
Regarding the second phase of the rail project, he said the findings of the feasibility study will be submitted to the government and the Transport Ministry will seek a budget of 797 million baht for a design study.
The 355-km stretch linking Nakhon Ratchasima with Nong Khai carries estimated costs of 215.7 billion baht.
The project, which will see trains running at speeds of 250km per hour, will be operational in 2023. When completed, it will slash travel time from Bangkok to Nong Khai from 11 to three hours.
Mr Arkhom, who chairs the committee on the Thai-Sino rail development scheme, said the committee has also approved development projects in Ayutthaya as a feeder system for the high-speed rail project.
These projects include the road expansion schemes for Highway 3053, Highway 309, Highway 3477 and Highway 356, the construction of a new provincial bus terminal, and a revamp of city bus routes.