Japanese bank seeks details on budget hike

The Japan Bank for International Cooperation (JBIC) has asked the Transport Ministry to clarify the additional Bt18-billion budget for the urban Red Line electric train project, following a sharp spike in the construction cost.

Speaking after a meeting yesterday with Hitoshi Tojima, senior representative of JBIC-Bangkok, Transport Minister Santi Prompat said, "They [JBIC] want to know the details of the material costs of construction of the Bang Sue station, which will be the centre of the mass transit system."

JBIC will finance the Rangsit-to-Bang Sue segment of the Red Line for civil works and the railway signalling system.

The State Railway of Thailand, which oversees the Red Line, originally estimated the project's cost at Bt59 billion. Later, it adjusted this to Bt66 billion to cope with the higher costs of construction materials.

Recently, the budget was revised upward again to Bt77 billion on higher costs as well as the work to upgrade Bang Sue station as the central station. The increase is 30 per cent on top of the original budget.

Santi said JBIC has asked for details on how higher construc-

tion material costs and oil prices contributed to the higher budget, and how much results from the upgrade of Bang Sue station. The SRT has been assigned to work on this issue and send the ministry an explanation as soon as possible, he said.

The Red Line is waiting for an Environmental Impact Assessment before issuing the terms of reference under the Bt77-billion budget. This budget excludes the fleet of electric trains and land expropriation costs. SRT will open bidding for the civil works first and bidding for electric trains later.

Santi said besides the Red Line, JBIC will finance the Purple Line (Bang Sue to Bang Yai) and the Blue Line (Bang Sue to Tha Phra and from Hualamphong to Bang Khae). The JBIC wants the ministry to clarify both the Blue Line and Red Line budgets

A source from the ministry said that some private companies who purchased the terms of reference for the Purple Line from the Mass Rapid Transit Authority of Thailand complained that the specifications of the contract are pre-designed to benefit a few big contractors.

"They said the project could be completed by more than three contractors. The three contracts are of huge value and this will only allow big companies to submit bidding," the source said.