September 14, 2010 / 6:40 AM / 9 years ago

Japan readies loans for California high-speed train

TOKYO, Sept 14 (Reuters) - Japan is prepared to offer loans to California to fund its high-speed rail system if it adopts the country’s shinkansen bullet train system, the Ministry of Land, Infrastructure and Transportation said on Tuesday.

“California is considering many options for its high-speed rail system and we want to promote our shinkansen so we don’t lose out to other countries,” a transport ministry official said.

Japan is targeting nuclear power plants, high-speed rail and other projects to win more overseas infrastructure projects, partly by enabling the state-backed Japan Bank for International Cooperation (JBIC) to provide long-term, low-interest loans.

The size of any loan to California would depend on the scope of the California rail project, the official said.

On Monday, California Governor Arnold Schwarzenegger said in Shanghai the state would seek China’s help in financing its high-speed rail system and welcome bids from Chinese firms to help build it. [ID:nTOE68C03H]

Earlier this year, California was awarded $2.25 billion of the $8 billion set aside for high-speed rail projects under the U.S. government’s stimulus plan. The state plans to build a high-speed line between Los Angeles and San Francisco.

The $8 billion, part of the $863 billion American Recovery and Reinvestment Act, will introduce high-speed rail to a country that has long relied on a vast interstate highway network and air travel.

Completing high-speed lines will require a mix of federal, state and private investment, experts have said.

California, which has entered its fiscal year without a budget signed into law, has seen its financial problems crimp its ability to move ahead with projects such as the high-speed rail. (Reporting by Chang-Ran Kim; Editing by Chris Gallagher)

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