THE TRANSPORT and Finance Ministries have approved plans for the restructuring of State Railway of Thailand.

On August 22 Transport Minister Pongsak Raktapongpaisal said the ministries had signed off the plan to deal with SRT’s liabilities and debts. The Finance Ministry will write off accumulated debts currently standing at 42·7bn baht, in exchange for the transfer of three large holdings of railway land in Bangkok, at Chong Nonsi, Makkasan and Lat Phrao, currently valued at 30bn baht. Future revenues from concessions to develop the land will securitise bonds to meet SRT’s pension liabilities.

Final plans for the operational restructuring have yet to be drawn up, but Pongsak expects SRT to focus on infrastructure management and open up the operation of passenger and freight services to the private sector. He wants SRT to strengthen its container services in the next four-year operating plan, noting that SRT freight services are profitable, even though the railway has only a 20% market share.

SRT is expected to cut back on loss-making passenger services, but the State Enterprises Policy Committee wants to see the railway raise its market share from 4% to around 30% of domestic travel.

On August 27 SRT Governor Chitsanti Dhanasobon revealed that the railway was drawing up plans for a high speed passenger service between Bangkok and Nakhon Ratchasima, including development of a 200 km/h diesel trainset to cut the journey time to 1h 45min from 2010. Chitsanti expects the 116bn baht package to be part-financed by private-sector investors.