Early works begin on the China-linked corridor as engineering challenges, land acquisition and procurement oversight come into focus
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Vietnam has begun early execution of a $7.7-billion rail megaproject linking its northern border with China to Hanoi and the Hai Phong port complex, moving one of Southeast Asia’s largest transport investments from legislative approval into initial construction activity.
The Lao Cai–Hanoi–Hai Phong railway was approved in February by Vietnam’s National Assembly, which authorized public investment in a new standard-gauge line designed to carry both freight and passengers. Government documents describe a corridor running from the border rail in Lao Cai province through Hanoi to Lach Huyen station in Hai Phong.
The National Assembly set an objective of completing the project by 2030 and directed the government to begin preparing a feasibility report during 2025, while allowing certain preparatory and enabling activities to proceed in parallel.
Under the resolution, the line will use a 1,435-mm gauge and operate at design speeds of up to 160 kph on mainline segments outside Hanoi, with reduced speeds through urban sections and on secondary lines. Vietnamese officials have said the gauge choice is intended to align the country’s rail system with international standards and improve interoperability with China’s network, particularly for freight traffic.
Implementation authority rests with the central government and the prime minister, with execution to be carried out through a specialized project management board. Vietnam Railways is designated to assume responsibility for infrastructure management and operations once construction is completed.
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Government statements issued earlier in December confirmed early execution has begun on a first component of the project.
Officials said initial activities include work at several stations, while design work for additional stations is underway and expected to advance in phases through 2026. Mainline track construction is expected to begin after completing preparatory activities and obtaining feasibility-stage approvals.
Topographic and Geographical Challenges
From an engineering and delivery standpoint, the approved alignment points to a complex construction program.
The corridor crosses nine provinces, beginning in mountainous border regions near Lao Cai, passing through riverine and agricultural areas of the Red River basin, threading dense urban sections in and around Hanoi and terminating at coastal port facilities in Hai Phong. The resolution authorizes varying design speeds by segment, reflecting the physical and urban constraints along the route.
The scale of enabling work is also substantial. The National Assembly estimated land needs at about 2,632 hectares and a displaced population of roughly 19,136 people, assigning provincial people’s committees responsibility for land acquisition, resettlement and related subprojects.
Financing for the railway is structured as public investment and may draw on state budget allocations, government bonds and foreign concessional loans. The National Assembly explicitly authorized the mobilization of official development assistance and foreign loans without requiring separate approval procedures.
Government statements earlier this year indicated that Chinese government loans are expected to form part of the financing, though detailed terms have not been publicly disclosed.
To support construction across diverse terrain, the resolution includes special requirements for sourcing material. Those provisions allow provincial authorities to modify mining licenses and capacity for common construction materials needed for the project, while adhering to environmental and safety requirements.
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While the National Assembly authorized flexible procurement mechanisms, including the use of EPC packages and direct contracting in specific circumstances, it also mandated enhanced oversight. The resolution requires multi-agency participation in contractor appraisals and directs the State Audit Office to audit project implementation.
No contractors or designers have yet been named, and no procurement schedule for main civil works or rail systems has been released. Officials have said the current focus remains on completing feasibility work, detailed designs and enabling activities before moving into large-scale construction.
Vietnamese authorities have described the railway as a cornerstone of the country’s long-term transport and industrial strategy, aimed at easing pressure on highways, improving export logistics and strengthening cross-border connectivity.
As early work progresses and more components move toward procurement, the project is expected to draw close attention from global rail contractors and designers evaluating one of Southeast Asia’s largest rail construction programs moving toward execution.
