Vietnam Urges Railway Modernisation Ahead of $67 Billion High-Speed Rail Expansion

Vietnam, October 2026 – Vietnam’s railway sector is facing renewed pressure to improve its performance as the government advances plans for major national railway projects. Speaking at a ceremony marking the sector’s 145th anniversary on 16 October, Standing Deputy Prime Minister Pham Gia Tuc called on Vietnam National Railways (VNR) to address structural weaknesses and strengthen its readiness for large-scale infrastructure investment.

The existing North–South railway remains a single-track, metre-gauge line built nearly a century ago. Rail accounts for just 0.12% of passenger transport and 0.18% of freight movement nationwide, while logistics costs remain between 14% and 16% of gross domestic product. Railway infrastructure has received only 3% to 5% of total transport investment in recent years, with much of the funding directed towards maintenance rather than network expansion. Outdated technology, administrative barriers and limited digital integration also constrain operational efficiency.

The government’s railway development agenda includes a proposed 1,541-kilometre North–South high-speed railway estimated to cost US$67 billion, alongside the Lao Cai–Hanoi–Hai Phong railway. Other potential routes include Hanoi–Dong Dang and Ho Chi Minh City–Can Tho, as well as international connections with China, Laos and wider regional networks. These projects could strengthen passenger mobility and freight connectivity, but their delivery will require coordinated planning, effective project management and sufficient technical expertise.

Tuc urged VNR to prepare its workforce ahead of infrastructure expansion, including retraining its approximately 22,000 employees so local teams can independently operate and maintain new railway systems. He also called for greater domestic technology development, improved safety management and comprehensive digital transformation. Proposed measures include using digital twin technology for asset management and applying transit-oriented development models to unlock commercial opportunities at the operator’s 312 existing stations. The emphasis is on building lasting technical capabilities rather than relying solely on imported systems and equipment.

The railway sector’s ability to translate investment plans into operational improvements will be critical to Vietnam’s wider transport and economic objectives. Modernising existing infrastructure, developing skilled personnel, strengthening local supply chains and improving governance could help ensure that new railway lines deliver sustainable benefits. As Vietnam moves towards high-speed and expanded regional rail services, institutional readiness will be as important as construction itself.

Source: The Investor