Thailand’s largest conglomerate is about to sign a $6.9bn deal with a Chinese contractor to build a high-speed railway connecting three of the country’s largest airports, according to the State Railway of Thailand.
The State Railway of Thailand granted CP Group negotiating rights in bidding held last November, but talks on the 220 billion baht ($6.92 billion) project stalled due in large part to financing issues.
“CP has made a deal with a financial institution, removing a large barrier,” a senior State Railway official said. The plan is to have the Thai government approve a final agreement by the end of the month once the details are worked out.
The railway will connect two Bangkok area airports, Don Mueang and Suvarnabhumi, with U-Tapao airport along the southern coast. The 220-km trip will take an hour.
The line will serve the Eastern Economic Corridor, an area designated to develop the country’s next generation of industries. Improved access to the capital, a key industrial area and a major port city, is expected to further Thailand’s development.
CP has partnered on the project with China Railway Construction Corp., which is expected to handle actual construction once a contract is inked. CP had expected Japanese companies like Itochu and Hitachi to join, but they opted out on concerns about profitability.