Bangkok's Red Line mass transit project eyes Japan funding

Construction News

Initial bids for project deemed unqualified

The government will scrap bids for the third contract of the Red Line mass transit project to ensure it receives 70 billion baht from the Japan International Cooperation Agency (JICA) to finance the project.

Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong took a team of senior finance executives to meet JICA president Akihiko Tanaka in Japan last week to clarify delays in disbursement of the loan.

Mr Kittiratt said the loan would be needed to finance the Red Line project, linking Bangkok’s Bang Sue to Pathum Thani’s Rangsit, which has been delayed for more than one year by technical problems.

The State Railway of Thailand, which supervises the Red Line, faces several problems including the need to remove public utilities, especially a fuel pipeline belonging to Fuel Pipeline Transportation Co along the route, he said.

The SRT’s board decided to scrap bids for the third contract, involving electricity and signalling-system work worth 26.7 billion baht, he said.

All four bidders failed to qualify after an initial examination of their qualifications.

They were MHSC Consortium, SMCK Consortium, MIR Consortium, and SAMSUNG Consortium.

The first two consortia were found to have a joint interest in the project which is prohibited by the terms of reference.

The MIR Consortium’s bidding documents contained some flaws, while the SAMSUNG Consortium failed to submit all required documents.

Mr Kittiratt said the SRT is expected to call a new round of bids soon and tackle the problems.

“I am confident Japan will be able to disburse the loan this year,” he said.

Both JICA and the Japan Bank for International Cooperation had pledged to provide loans to fund infrastructure development under the Greater Mekong Subregion programme.

He had agreed to consider a proposal to set up a mutual fund to allow Japanese small-and medium-sized enterprises to invest in or expand businesses in Thailand.

Japan has offered to chip in 3 billion baht as a start-up fund and Mr Kittiratt has asked the Financial Policy Office to study the proposal.

He said Japan’s offer indicates its confidence in the Thai economy and the government.


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