Three-airport high-speed rail hit by fresh delay as contract change with CP must wait for new Cabinet
Thailand’s flagship high-speed rail project linking Don Mueang, Suvarnabhumi and U-Tapao faces further delays after the House dissolution pushed the government into caretaker status, preventing approval of key amendments to the CP-led PPP contract.
The three-airport high-speed rail project has been dealt another setback after the dissolution of the House of Representatives on December 12, pushed the current Cabinet into caretaker status, meaning it can no longer approve projects or make decisions that create long-term binding obligations.
Large-scale investment schemes under the Ministry of Transport that were queued for Cabinet approval must now be held back for the next government. Among them is the high-speed rail link in the Eastern Economic Corridor (EEC) connecting Don Mueang, Suvarnabhumi and U-Tapao airports, where the state is preparing to seek Cabinet approval to amend the public-private partnership (PPP) contract.
At its meeting on December 12, the board of the State Railway of Thailand (SRT) resolved to propose a review of the previous Cabinet resolution on the three-airport high-speed rail project. The SRT plans to ask the Cabinet to approve amendments to the PPP contract on two key points:
- Restructuring of Airport Rail Link (ARL) concession payments
- Changing the state’s support payments to a “build-and-pay-as-you-go” model
In addition, the amendments must take into account two main points raised by the Office of the Attorney-General:
- The revised “build-and-pay-as-you-go” payment structure must comply with the State Fiscal and Financial Discipline Act.
- Civil works guarantees: the Attorney-General has advised that the guarantees should cover the entire project. Under the original contract, once the Notice to Proceed (NTP) is issued, the project must have a 4.5-billion-baht performance guarantee, plus 140 billion baht in shareholder guarantees, equivalent to the state co-investment value including interest.
The contract amendment has already been endorsed by the SRT board, and the next step is submission to the Eastern Economic Corridor Office (EECO). However, because the matter creates long-term legal obligations, the caretaker Cabinet is barred from considering it. As a result, the project must pause until a new government is formed and able to deliberate.
The three-airport high-speed rail project is being developed under a PPP contract signed on October 24, 2019 between the SRT and Asia Era One Co., Ltd., in which the CP Group is the major shareholder. Asia Era One won the tender by offering the lowest state co-investment at 117.226 billion baht.
In October 2021, the Cabinet under then Prime Minister Prayut Chan-o-cha approved compensation measures for pandemic-related losses after passenger numbers on the Airport Rail Link dropped sharply due to COVID-19. Contract renegotiations have continued through successive administrations — those of Srettha Thavisin, Paetongtarn Shinawatra, and now Anutin Charnvirakul — but the draft amendments have still not been approved.
As a result, the public has been deprived of the benefits of the three-airport high-speed rail line for more than six years, with the project still awaiting a final green light from a future Cabinet.
