BANGKOK (Reuters) - Thailand’s cabinet approved on Tuesday a high-speed railway project expected to cost about 225 billion baht ($7.22 billion), that will link three airports, a government official said.
The approval comes at a time when surging tourist arrivals - now equivalent to more than half of the Thai population - have put some strain on Thai infrastructure.
The rail link will connect the two airports in the Bangkok area - Don Mueang International and Suvarnabhumi International - with U-Tapao, built during the Vietnam War in the eastern province of Rayong.
The government expects to select winners for the public-private partnership project (PPP) in October and expects it to be in service in 2023, Nathporn Chatusripitak, a spokesman for Deputy Prime Minister Somkid Jatusripitak, told reporters.
According to a government statement, the cost of the project is about 225 billion baht, slightly higher than 200 billion baht mentioned earlier by officials.
“We will wait to see the TOR (terms of reference) of the auction before considering participation because this is a long-term investment,” a spokesperson at CH Karnchang Pcl told Reuters.
The firm built a large portion of Bangkok’s metro systems and subsidiary Bangkok Expressway and Metro built and operates expressways and mass transit systems.
The high-speed railway is part of the government’s larger transport infrastructure investment action plan worth 2.02 trillion baht, covering rails, roads, airports and seaports.
The junta has ramped up infrastructure investment in a bid to boost growth Thailand has lagged regional peers since the army took power in 2014.
The finance ministry has forecast economic growth of 4.2 percent this year, after 3.9 percent growth last year, the fastest pace in five years.
Infrastructure projects will also help ease pressure from the influx of foreign tourists.
Tourist receipts account for about 12 percent of gross domestic product in Southeast Asia’s second-largest economy.
The government expects 37.55 million foreign visitors to spend 2.1 trillion baht this year, after a record 35.38 million tourists who spent 1.8 trillion baht last year.
(For a graphic of Thailand tourist arrivals click reut.rs/2ERvK77)
($1 = 31.1700 baht)
Additional reporting by Chayut Setboonsarng; Writing by Orathai Sriring; Editing by Kim Coghill