High-speed Beijing-Shanghai railway to run trials

SHANGHAI — A long-anticipated high-speed railway between Beijing and Shanghai is due to begin trial operations Wednesday, as China persists with its lavish rail spending despite recent losses and scandals.

Railway investment is expected to reach 745.5 billion yuan ($115 billion) this year, despite a 3.76 billion yuan ($578 million) loss on all rail operations in the first quarter, Railways Ministry spokesman Wang Yongping told reporters in Beijing.

Wang said the ministry, which enjoys a virtual monopoly in the industry, would carry on with construction to suit the country's level of economic and social development, despite rising costs and growing debt levels.

That is down 12.3 percent from earlier plans but not as huge a cutback as earlier reports by some state media had suggested following an announcement last month that China would slow down its bullet trains following complaints the showcase system is dangerously fast and too expensive.

Recently appointed Railways Minister Sheng Guangzu reportedly favors scaling back the program, though any decision to do so would be politically sensitive given its status as a national prestige project.

Sheng's long-serving predecessor, Liu Zhijun, was the public face of high-speed rail plans but was dismissed earlier this spring amid a graft investigation. No details have been released about the allegations against Liu, but news reports say the accusations included kickbacks, bribes, illegal contracts and sexual liaisons.

In March, the National Audit Office reported that 187 million yuan ($28 million) had been embezzled from the Beijing-Shanghai project.

The 215 billion yuan ($32.5 billion) Beijing-Shanghai rail line is due to begin regular operations on June 9. It will halve current rail travel time to less than five hours, running at about 300 kph (190 mph).

But while the trains are designed to run at a maximum speed of 380 kph (234 mph), Sheng, the railways minister, recently announced that the high-speed lines would slow to 300 kph (190 mph) from the current 350 kph (220 mph) in response to safety concerns.

Overall, China aims to have 8,000 miles (13,000 kilometers) of high-speed rail in place by the year's end and twice that length by 2020.

The emphasis on high-speed passenger railways has prompted complaints that excessively expensive lines, too costly for many average Chinese, are displacing more affordable conventional services.

And while China's railway corporations vie with global rivals like Siemens, Japan Railways and Bombadier for overseas contracts, freight capacity remains inadequate and poorly coordinated, contributing to costly bottlenecks throughout the economy.