Viet Nam Fast-Tracks High-Speed Rail

“This project is pivotal for restructuring transport and serves as a cornerstone for Viet Nam’s leap into a new era of growth.” Those words by Nguyen Danh Huy, Viet Nam’s Deputy Minister of Transport, summarise the rationale for investing USD67 billion in South East Asia’s advanced rail system.

On 30 November 2024, Viet Nam’s National Assembly approved the development of a 1,541km North-South high-speed railway with trains set to run at up to 350kph. Traversing 20 provinces, the railway would connect the capital Hanoi in the north with Ho Chi Minh City in the south in around six hours. Construction is slated to start in 2027, and take a maximum of 10 years. The outcome would be South East Asia’s first national high-speed rail network, not simply a point-to-point inter-city line.

High-speed rail across South East Asia has been expanding quickly. Pictured is Indonesia's high-speed train, colloquially known as Whoosh, which began running in 2023. Image: Wikimedia Commons

Viet Nam’s seahorse-shaped geography is a decisive factor. Its arcing, elongated landscape means that building a railway from Hanoi to Ho Chi Minh City could comfortably incorporate stops at coastal cities and destinations – such as Hue, Danang and Nha Trang – en route. It is estimated that up to 80 percent of Viet Nam’s increasingly urbanised population would potentially gain access to rapid inter-city trains. The network could also revolutionise tourism in one of Asia’s fastest growing visitor economies.

The broader economic picture

Viet Nam’s high-speed rail ambitions date back two decades. A Hanoi-Ho Chi Minh City bullet trainline costing USD38 billion was proposed in 2005. In 2010, the National Assembly rejected another proposal, which was supported by Japan and priced at US$56 billion. In both instances, it was decided that Viet Nam’s fledgling market economy would struggle to finance, construct and manage such a vast infrastructure project.

The economic contexts have changed. In 2025, Viet Nam’s strategic ambitions are more elevated. Now is considered an optimal time to transform inter-provincial mobility to expedite national development and economic diversification.

After the economically destructive Covid years, Viet Nam’s GDP expanded by 7.1% in 2024. The government is targeting 8% growth in 2025, while the World Bank projects 6.8%. Drill down, though, and the statistics show a structural need for growth. With a population of 101.3 million at the end of 2024, Viet Nam’s GDP per capita remains low, at USD4,700.

The ultimate objective is for Viet Nam to become a high-income nation by 2045. This would require GDP growth to average 6% for the next 20 years. Mirroring a model pursued by China at the turn of the century, a national transport infrastructure plan has been identified as a catalyst for sustained growth. Enhanced connectivity would help upgrade supply chains, bolster value-added manufacturing, attract investment and drive consumer and travel spend.

Viet Nam has a growing economy and is aiming to become a high-income nation by 2045. Image: Unsplash

Major investments, big challenges

Pieces of this vast jigsaw are falling into place. Viet Nam is investing to more than double its national highway network to 5,000 km by 2030. A high-speed railway is approved. The under-construction Long Thanh International Airport near Ho Chi Minh City will become one of Asia’s largest when completed. In February, Viet Nam and China agreed to build a cross-border trainline to Haiphong port to improve cargo logistics between the land and ocean.

High-speed railways are complex and not easily accomplished, however. They frequently exceed budgets and schedules. Since Japan launched Asia’s first bullet trains in 1964, only four countries have followed: South Korea, China, Taiwan and, most recently, Indonesia.

Inaugurated in October 2023, South East Asia’s first high-speed rail line runs between Indonesia’s capital Jakarta and Bandung. The distance is 142km, less than one-tenth the length of Viet Nam’s high-speed project, and took eight years to complete. Part of the delay was attributed to adapting Chinese high-speed rail technology to the tropical topography and climate of Indonesian Java, which resides below the equator.

Meantime, China has grown frustrated with Thailand for persistent delays in building its first high-speed railway between Bangkok and the Lao border. There, it would hook-up to the China-Laos railway, running from Vientiane to Kunming in southwestern China. Chinese firms are providing the engineering and train technology, but the delays are due to local logistical factors in Thailand. An ongoing task is to construct a modern railway adjacent to the ancient ruins of Ayutthaya without compromising its UNESCO World Heritage status.

Regional tracks in ASEAN

Viet Nam’s proposed combination of a national high-speed rail network and a cross-border express railway with China would send a powerful message to its ASEAN neighbours. The strategic intention is to accelerate, as quickly as possible, from being the region’s fifth- to second-largest economy, behind Indonesia.

Will Viet Nam select China as a partner for its High-Speed Railway? Image: Gary Bowerman

Currently, Indonesia is the only other South East Asian nation with comparable bullet train plans. However, a 700km high-speed rail extension from Jakarta to the second city of Surabaya has yet to be approved amid budget constraints for the Prabowo administration.

Construction of Malaysia’s national rail network expansion is well advanced, but it will not feature bullet trains. A new southern railway will link Kuala Lumpur to the border with Singapore by the start of 2026. Due to open in 2027, Malaysia’s largest transport infrastructure project, the USD11.2 billion, 665km East Coast Rail Link, will connect Kuala Lumpur with cities, ports and destinations along the eastern seaboard, terminating near the Thai border. The maximum speed of the China-manufactured trains will be 160kph, well below the 250kph threshold for high-speed status.

Partnership priorities

Meanwhile, regional eyes are watching India, which is teaming with Japan to develop a national bullet train network. Trains for the initial 500km high-speed railway between Mumbai and Ahmedabad, which is due to open in 2027, utilise Japanese technology but are being manufactured in India.

Viet Nam, which like India has no high-speed rail experience, has stressed that its external rail partners must facilitate technology and skills transfer. It will likely seek to strike a similar Made in Viet Nam deal with its chosen partner – whether that be from China, Japan, South Korea or, a longer shot, France or Spain.

Watch this space.

Asia Media Centre