Local intensive approval of urban rail projects total investment of 4 trillion

In a recent development, the "mother-in-law" has finally been removed, allowing the "wife-in-law" to take control. On August 11, the Chongqing Municipal Development and Reform Commission and the Municipal Rail Group jointly announced that the feasibility study report for the Chongqing Orbital Loop Project has been successfully approved and is set to begin construction by the end of this year, with trial operations expected in 2018. This marks the first rail transit project independently organized by Chongqing after the national approval of derailment rail projects. The total estimated investment for the project is 31.418 billion yuan. Additionally, the feasibility study report for the northern extension of Chongqing’s Light Rail Line 3 was also approved, with an official letter issued by the Chongqing Municipal Development and Reform Commission. The project is scheduled to start in 2013, with a construction period of 30 months. Compared to the orbital loop line, this project has a significantly smaller budget of about 4.1 billion yuan and a similar construction timeline. These two urban rail projects reflect the broader trend of local governments accelerating investments in transportation infrastructure following the decentralization of approval authority by the National Development and Reform Commission. In fact, more than ten cities have recently approved applications for their own urban rail projects. In Zhuhai, the budget proposal for the first phase of the Tram Line 1 project has been approved, with an estimated cost of around 850 million yuan. Meanwhile, in Gansu Province, the feasibility study report for Lanzhou Urban Rail Transit Line 1 was approved on August 7, with a total investment of 18.943 billion yuan. Other cities such as Hangzhou, Wuhan, Changsha, and others are also planning or preparing for new rail projects. This surge in urban rail construction is closely tied to macroeconomic policies and government priorities. At a State Council executive meeting on July 31, the focus was placed on strengthening urban infrastructure to improve weak links, stimulate investment and consumption, and enhance the city's overall carrying capacity. Similarly, at the Ministry of Transport’s mid-year work conference, promoting urban rail transit was identified as one of the five major priorities for the second half of the year. Academician Wang Mengshu noted that nearly all cities are now planning or building subways and urban rail systems. According to estimates by Huamao Kun, chief engineer of the former Ministry of Railways, there are currently 36 cities approved for rail transit construction. By 2020, China’s rail transit mileage is expected to reach nearly 6,000 kilometers, with an investment of 4 trillion yuan. However, the rapid expansion of urban rail projects has raised concerns about financial sustainability. Zhao Jian, a professor at Beijing Jiaotong University, pointed out that many cities lack clear financial responsibility and are still grappling with accumulated local debt. He warned that rushing to approve large-scale rail projects without proper oversight could lead to unsustainable debt burdens. While various financing models such as BT, PPP, and BOT have helped fund these projects, they often result in increased local government debt. Zhao emphasized that urban rail transit should primarily rely on public finance, with private capital playing a supportive role rather than a dominant one. In conclusion, while the growth of urban rail infrastructure reflects a national push for modernization and development, it also brings challenges related to funding, debt management, and long-term sustainability. Balancing these factors will be crucial for the future of urban rail transit in China.

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