Additional $81,000 in capital proposed for Nhổn-Hà Nội Station metro line

May 10, 2023 - 08:23
The amount of capital from the city’s budget increases by VNĐ3.9 billion ($166,300) and the ODA loans decrease by VNĐ2 billion ($85,300).  
An aerial view of the elevated section of the Nhổn-Hà Nội metro line. — VNA/VNS Photo Tuấn Anh

HÀ NỘI — Hà Nội People’s Committee has submitted a report to the Prime Minister on extending the completion deadline for the Nhổn-Hà Nội Station metro line project and increasing the budget.

The new completion date is proposed to be 2027, with a total investment capital of VNĐ34.8 trillion (US$1.5 billion).

According to Report No 104/TTr-UBND, the elevated section of the urban railway line will go into operation in 2023, while the entire route, including the underground section, will be in operation in 2027. 

The total project capital will also increase by VNĐ1.9 billion ($81,000), of which the amount from the city’s budget increases by VNĐ3.9 billion ($166,300) and the official assistance development (ODA) loans decrease by VNĐ2 billion ($85,300).  

Following the adjustments, the ODA loans will total VNĐ24.8 trillion ($1.1 billion), of which $374.6 million comes from the Asian Development Bank (ADB), EUR 158.8 million ($174.6 million) from the French Development Agency (AFD), EUR 125.5 million ($138 million) from the European Investment Bank (EIB), EUR 355.4 million ($390.6 million) from the French government, and VNĐ10 trillion ($426.3 million) from Hà Nội's budget. 

The city’s People’s Committee said that many contract packages are unable to be extended and paid due to unfinished approval procedures. 

However, the project's head investor still has to urge contractors to continue their work to keep up with the schedule, ensuring that the elevated section will go into operation this year. 

Therefore, the committee asked the Prime Minister to make a decision on the project implementation, including construction, budget disbursement, payment to contractors, and adjusting loan agreements, contract packages and investment strategy. 

In the report, Hà Nội also outlined the key reasons behind the project’s delay, which are slow progress in land clearance and the shortcomings regarding the head investor’s capacity, the synergy between the consultant agencies, the head investors and relevant departments. 

The metro line project has the Hanoi Metropolitan Railway Management Board (MRB) as the head investor and implementation coordinator, but no main contractor. It was instead divided into nine main bidding packages, requiring significant synergy between stakeholders. 

Insufficient consultation on the difference between FIDIC contracts and the current Vietnamese laws, as well as the limited capacity of the local contractor Hancorp in constructing the depot, are also among the reasons for the project’s delay. 

The elevated section of the Nhổn-Hà Nội Station metro line, which stretches from Nhổn to Cầu Giấy streets, is expected to go into operation in late August - early September this year. 

Hanoi Public Transport Management Centre (HPTC) is reviewing the bus routes on this track for a better connection with the urban railway. 

An HPTC representative said: “Among these 31 bus routes, 28 are subsidised and three are not. 

“A survey shows that there are approximately 118,000 people using public transport to travel on a daily basis.”

According to the MRB, each train on the Nhổn-Hà Nội Station line has four cars, with each car being able to carry up to 230 passengers. 

The waiting time for passengers is expected to be around 7.5 minutes.

Following the rearrangement in the public transport network, it is expected that up to 20 per cent of locals living along the metro line will switch from personal vehicles to the urban railway. 

In addition to the 31 existing bus routes in the area, the city’s transport department also plans to open new routes that connect to the Nhổn-Hà Nội Station line. 

The Ministry of Transport also agrees with Hà Nội People’s Committee’s proposal, saying that “with the current bottlenecks in implementation, adjusting the project duration is necessary to continue the work and put the line into operation.”

The ministry added the city needs to make accurate calculations with clear responsibilities and penalties among stakeholders. This is to ensure that the project is finished by the extended deadline of 2027. 

Nhổn-Hà Nội Station urban railway line, with a length of over 12km, was first approved in 2006 with a total investment of EUR 783 million ($860 million) and expected to be completed in 2010, on the 1000th anniversary of the capital city. 

However, it was not until September 2010 that the project started construction, with the capital increased to EUR 1.2 billion ($1.3 billion) and the deadline moved to 2015. 

Due to multiple bottlenecks in implementation, the project’s completion date was moved to 2018, then 2022, and currently 2027 - including the warranty period and payment finalisation. — VNS