39175-013: VIE: GMS Kunming-Haiphong Transport Corridor: Yen Vien-Lao Cai Railway Upgrading Project

Project Data Sheet (PDS): Details

Description

The Project is designed to promote sustainable economic growth by rehabilitating 285 kilometers of railway line from Yen Vien station in the the northern suburbs of Hanoi to Lao Cai on the border with the People's Republic of China (the PRC). The Project will develop a safe, efficient, and environmentally sustainable railway transport system in the northwest region of Viet Nam, enhance connectivity with the PRC through the Kunming-Hai Phong transport corridor, and assist with institutional reform of the railway subsector.

Project Rationale and Linkage to Country/Regional Strategy

The Hai Phong to Lao Cai railway forms part of the Kunming-Haiphong transport corridor linking Yunna province in the PRC with Viet Nam. Minimal investments in improvements and maintenance have meant that the railway bed and track have deteriorated and no longer meet capacity and safety requirements. The Project will rehabilitate the rail system to ensure it is capable of operating safely and efficiently. Increasing capacity at stations and main terminal points and carrying out strategic rehabilitation will permit the use of heavier and longer trains and an increase in the number of trains using the railway line. The Project will contribute to the Asian Development Bank's support for cooperation in the Greater Mekong Subregion and for the Government's investment in transport infrastructure. The railway from Yen Vien, near Hanoi, to Lao Cai on the border with the PRC is part of the Kunming-Hai Phong transport corridor, which is a strategic link in the GMS north-south corridor. Developing the transport corridor is a high-priority subregional transport project under the GMS Economic Cooperation Program, which aims to develop efficient multimodal infrastructure links between the GMS countries. The proposed Project will restore and expand the capacity of a long-established link between Yunnan province in the southwest of the PRC and the strategic port of Hai Phong in Viet Nam on the Gulf of Tonkin. Landlocked Yunnan province has a growing need for efficient transport routes to sea ports for the export of its goods.

Impact

Increased cross-border trade with Yunnan province in the PRC.

Project Outcome

Description of Outcome

More efficient rail transportation system

Progress Towards Outcome

Upon completion of all contracts designed to rehabilitate the railway system covered by this Project, it is expected that the rail transportation system would become more efficient. All contracts (CP1, CP2,CP3 and CP5) have been awarded and works ongoing satifactorily. The Project is now on track. Overall progress is about 90% and almost on schedule. The Project is expected to close as scheduled in 2015.

Implementation Progress

Description of Project Outputs

Railway infrastructure rehabilitation and upgrading, along with all associated resettlement and social mitigation activities on Yen Vien-Lao Cai railway line Financial management capacity of VNR improved

Status of Operation/Construction or Implementation Progress

On 30 November 2011, ADB approved the extension of the Loan closing date by three years from 1 January 2013 until 31 December 2015. Works are expected to be completed within the loan period.

Safeguard Categories

Environment: B
Involuntary Resettlement:
Indigenous Peoples: C

Summary of Environmental and Social Aspects

Special attention will be paid to ethnic minority issues and to resettlement in connection with realignment and expansion of stations.

Status of Covenants

Category Rating
Loan 2302
Sector Satisfactory
Social Satisfactory
Financial Satisfactory
Economic
Others Satisfactory
Safeguards Satisfactory
Project Financial Statements
Loan 8227
Sector
Social
Financial
Economic
Others
Safeguards
Project Financial Statements

 

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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