NAYPYITAW—A lawmaker sounded a warning on Thursday about the government’s plan to purchase railway carriages from China using loans from Beijing, saying steps must be taken to ensure that the price of the carriages is fair.
Lawmakers in the Lower House on Thursday discussed the Ministry of Transport and Communications’ plan to accept a no-interest loan of 80 million yuan (about 18.5 billion kyats) from China in order to buy the carriages. Lawmaker Daw Cho Cho of Oktwin Township urged officials to scrutinize the cost carefully.
“Though the loan is interest-free, we are obliged to purchase the carriages from the lender, so it is important that the products are of good quality, reasonably priced, and will not cost us far more than similar products from other countries. Because we will have to repay the loan, with or without interest,” Daw Cho Cho said.
The loan would be disbursed over five years. Myanmar would have to begin repayment five years after the last of the money is received. Repayment would be in installments of 10 percent, 8 million yuan, a year for the following 10 years. So the total repayment period would be 20 years.
Daw Cho Cho stressed that the carriages should be new, and not refurbished models. According to the Ministry of Transport and Communications, a total of 28 carriages—14 ordinary and 14 first class—will be purchased for use on the Yangon-Mandalay railroad.
More than 1,000 commuters use the route daily, with one carriage earning as much as 3 million kyats a day, Transport and Communications Minister U Thant Zin Maung told the Union Parliament on Monday.
“New carriages mean better safety and greater convenience for commuters. This will enhance the image of Myanma Railways [MR] while increasing revenue,” he said.
U Mya Sein, a Lower House lawmaker for Dagon Seikkan Township, called for a tender process to be launched in line with normal procedures.
Other lawmakers stressed the need for MR to improve its services.
A former MR official told The Irrawaddy on condition of anonymity that such deals are a good way for Myanmar to import new transport technologies, as China is a world leader in railway systems.
The Myanmar Railways Strategy 2018 jointly drafted by the Asian Development Bank and the Myanmar government, calls for the purchase of 60 new locomotives, 500 new passenger carriages and 800 freight carriages by 2027.
