The Chinese government plans to spend Rmb1.25 trillion to improve the country's railroad system by 2010, reports the Asian Wall Street Journal. With an ambitious goal to add 17,000 kilometres of track to link remote areas to major cities, Daqin Railway and China Railway Tielong Container Logistics could profit significantly from the government's project.
Investment in China's rail industry has been gaining momentum, particularly since the country's 2006 inauguration of one of the world's highest rail systems, which was constructed to link China to Lhasa, Tibet, by rail.
Despite China's recent rail expansion, critics say that the industry has yet to explore its full potential. A Deutsche Bank source told the Asian Wall Street Journal that although China covers 24% of the world's rail traffic, it only constitutes 6% in length of the world's measured tracks.
Investors have been quick to take advantage of the lucrative potential in this business. Investments in China's rail sector totalled Rmb62.9 billion in 2005, and increased to Rmb130.2 billion in 2006.