North-South High-Speed Railway: Vietnam’s Future in Regional Logistics

Vietnam’s ambitious North-South high-speed railway is poised to transform the nation’s transportation landscape, catalyzing economic growth, and enhancing regional integration. This proposed rail line will stretch nearly 1,600 kilometers, connecting the northern capital, Hanoi, to Ho Chi Minh City, the bustling southern economic hub. With an estimated cost of US$58.7 billion, the railway represents one of the largest infrastructure investments in the country’s history. The double-track line will drastically reduce travel time between the two cities from the current 33 hours by conventional rail to under eight hours.

Construction timeline and technical specifications

The North-South high-speed railway project is planned to be completed by 2035, with operations on its priority sections, Hanoi–Vinh and Ho Chi Minh City–Nha Trang, beginning as early as 2032. This phased approach will ensure that regions with high demand benefit first while construction continues less critical sections. The railway’s funding will be sourced from a mix of public and private investments, with the government actively seeking partnerships with foreign investors and financial institutions to manage costs and bring in technical expertise.

The line will feature state-of-the-art double-track technology, enabling speeds of up to 320 km/h for passenger services. This technology will support three distinct types of trains: high-speed passenger trains for daytime use, overnight sleeper trains to serve long-distance travelers, and cargo trains aimed at reducing pressure on road transportation. Completing the entire Hanoi-to-Ho Chi Minh City journey in less than eight hours will provide an attractive alternative to air travel, particularly when factoring in the time required for airport transfers and security procedures.

Additionally, the line’s capacity for cargo transport ensures that it serves not only passengers but also Vietnam’s growing trade sector.

Transformative economic impact and regional integration

The economic implications of the North-South high-speed railway are profound. High logistics costs, currently averaging 20 percent of GDP, have long been a barrier to Vietnam’s competitiveness in global trade. The railway will dramatically reduce these costs, facilitating faster and more efficient movement of goods. Lower transportation expenses will particularly benefit export-oriented industries such as electronics, textiles, and agriculture, enhancing Vietnam’s reputation as a manufacturing and export hub.

The railway’s integration into the Trans-Asian Railway (TAR) network further underscores its strategic importance. The TAR aims to establish a seamless rail connection across Asia, linking countries such as China, Thailand, and Myanmar to Vietnam and other Southeast Asian nations. Once operational, the North-South High-Speed Railway will play a pivotal role in this network, positioning Vietnam as a critical logistics hub within the Greater Mekong Subregion. By reducing trade bottlenecks and improving cross-border connectivity, the project is expected to attract significant foreign direct investment and create thousands of jobs in construction, operations, and related industries.

Moreover, the railway is anticipated to stimulate the development of secondary cities along its route, such as Da Nang, Hue, and Nha Trang, by improving access and enabling these cities to contribute more robustly to the national economy. The creation of new business opportunities and enhanced tourism prospects are just a few of the ancillary benefits likely to emerge.

Regional high-speed rail context: Lessons from Indonesia and Laos

Vietnam’s North-South high-speed railway is part of a broader trend in Southeast Asia of developing high-speed rail networks with regional implications. Neighboring countries like Indonesia and Laos have made significant strides in their rail infrastructure, providing valuable insights for Vietnam.

In October 2023, Indonesia inaugurated the Jakarta-Bandung High-Speed Rail, Southeast Asia’s first operational high-speed railway. Built with significant assistance from China under the Belt and Road Initiative (BRI), this 142-kilometer line connects Jakarta to Bandung in just 40 minutes, reducing travel time from the previous two to three hours. The project, initially estimated at US$5 billion, faced setbacks such as land acquisition challenges and the COVID-19 pandemic, leading to cost surges of up to US$7 billion. Despite these hurdles, the railway exemplifies how high-speed rail can address urban congestion, foster regional economic growth, and stimulate tourism. Vietnam can learn from Indonesia’s approach to balancing foreign investment while safeguarding national interests in large-scale infrastructure projects.

Similarly, Laos completed its China-Laos Railway in December 2021, 414 kilometers from Vientiane to Boten on the Laos-China border. This US$6 billion project, equivalent to one-third of Laos’ GDP, was backed by China as part of its BRI. The railway has transformed logistics for landlocked Laos, reducing transport times to the Chinese border from 15 hours by car to less than four hours by train. It has also opened new opportunities for trade and tourism, with an initial 300,000 containers from Laos expected to be transported via the railway to Europe from China annually, a figure anticipated to increase to between 1.2 and 1.8 million containers per year.

Both Indonesia and Laos illustrate the economic and social potential of high-speed rail. They also highlight the importance of addressing local needs while navigating complex international partnerships.

Collaboration with China and other high-speed rail projects

While the North-South high-speed railway is Vietnam’s flagship project, it is complemented by other high-speed rail initiatives, many of which involve collaboration with China. For instance, the Lao Cai–Hanoi–Haiphong railway is a critical component of China’s Belt and Road Initiative (BRI). This line aims to connect Vietnam’s northern provinces with China’s Guangxi region, facilitating trade and boosting regional cooperation. Designed to handle both passenger and freight traffic, the Lao Cai–Hanoi–Haiphong line is expected to strengthen the economic linkages between the two nations.

Another significant project is the Hanoi–Dong Dang railway, which connects Vietnam to China’s extensive high-speed rail network. This line will streamline cross-border transportation, making it easier for goods and people to move between the two countries.

A vision for Vietnam’s future

The North-South high-speed railway can be a cornerstone of Vietnam’s economic modernization and sustainable growth aspirations. By drastically reducing travel times, cutting logistics costs, and enhancing regional connectivity, the railway will bolster Vietnam’s competitiveness on the global stage.

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