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INFRASTRUCTURE
WICHIT CHANTANUSORNSIRI
Bangkok's new mass-transit routes could be delayed due to political uncertainties, acknowledged a senior Finance Ministry official.
Authorities hope to award construction contracts for two routes by the end of the year: the Red line running from Bang Sue to Rangsit and the Blue line from Bang Sue via Tha Phra and Hua Lamphong to Bang Khae.
But political uncertainties and poor market sentiment are almost certain to force a delay. Confidence has nosedived in recent months due to soaring inflation and uncertainties about the stability of the Samak Sundaravej government.
The People's Alliance for Democracy has vowed to continue to stage daily rallies in a bid to force the government from office. The leading People's Power Party, meanwhile, is facing possible dissolution due to election fraud by senior executives during last December's polls.
Three ministers, including Finance Minister Surapong Suebwonglee, could also be forced from the cabinet due to their involvement in the two- and three-digit lottery scheme approved during the Thaksin Shinawatra government.
Soaring oil and commodities prices have also dampened investment activity. For the megaprojects, the government has already moved to raise its budget estimates to help compensate for higher raw materials expenses, with phase two of the Red line now projected to cost 77 billion baht from earlier estimates of 59 billion.
The government has announced plans to build nine mass-transit routes overall in Bangkok with a total budget of 760 billion baht. Bids are currently being accepted for the Purple line route, with financing for the project to come from loans from the Japan Bank for International Co-operation.
For the Red line, JBIC is currently reviewing financing plans for the route, with new talks expected to be held with Thai officials within the next two or three months. The Finance Ministry plans to borrow from JBIC funds to cover 80% of the total cost of the route, with the rest borrowed from domestic financial institutions and from the central budget.
Of the 760-billion-baht budget for the overall mass-transit programme, foreign loans are estimated to cover 40% of the total investment, domestic loans 30% and direct budget allocations the remaining 30%.
Officials say that the financing programme could be adjusted to increase overseas borrowings and reduce budget spending to help shift funds from the annual government budget to other domestic programmes.
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