Future of rail reform unveiled

The transport ministry pledged Thursday to further push forward the transformation of its operations as emphasized during the recently-concluded annual "two sessions," in an effort to promote service quality. It also noted that the market will have a bigger say in determining railway ticket prices as reforms proceed.

The newly reorganized Ministry of Transport (MOT) will make efforts to streamline administration and advance the construction of a comprehensive transportation system incorporating railways, He Jianzhong, a spokesperson for the ministry, told a press conference.

"At the moment, the ministry is still in charge of 65 administrative project assessments and approvals, and we have started researching which should be canceled … and which can be transferred to local authorities," said He.

Following the State Council's plan for institutional restructuring, the decades-old railways ministry was dismantled, with its overall development strategy and policy-making functions being transferred to the MOT.

In the process, the State Railways Administration was established and put under the administration of the MOT. He said the bureau's main responsibilities would focus on the formulation of railway technical standards, supervision of railway construction and operational service quality, among others.

On Thursday, some media reported that the newly founded China Railway Corporation, which is to take control of the former railways ministry's business functions, will maintain "ministry-level" status and will be directly overseen by the State Council. The news soon prompted people to worry that the reform will only have limited effects.

Zhao Jian, a professor specializing in railway economics at the Beijing Jiaotong University, said that since there are still many problems left from the railways ministry, it is not surprising that the public is still pessimistic.

"The former railways ministry left huge debts and the question of who will pay for them remains a problem. Meanwhile, more high-speed rail lines are still under construction, which may make the issue worse," said Zhao, adding that guaranteeing their safe operation in the future will require more efforts.

The ministry was 2,600 billion yuan ($418 billion) in debt before the split.

"Reform will certainly be difficult because it will affect the interests of vested groups and it takes a lot of time in terms of human resources rearrangement," Yun Jie, director of the administration research department at the Chinese Academy of Social Sciences, told the Global Times. "It's easy to work out a reform plan, but effectively implementing it will be tough."

In response to the prevailing concern that railway ticket prices would go up after the railways system was pushed onto the market, He said supervision over the pricing of railway tickets should be strengthened by related authorities, but "as an enterprise, the National Railway Corporation should have a certain level of commercial autonomy."

Yun said there will need to be a process before the railways sector fully enables market competition, and ticket prices are not expected to see remarkable changes in the short term.

He also said the ministry will further loosen the access threshold for private capital to broaden the investment and financing of transportation construction.