Benefit in every way with international transit station

From experience in exploiting international transit operations at Kep station, Vietnam Railways recommends investing in station infrastructure to serve international transit transport by rail, meeting the growing demand.

Reduce time and cost

International container train at Kep station

In early April 2023, after more than 1 month of officially putting into operation international trains, Kep station (Lang Giang district, Bac Giang) was bustling with container trucks coming and going.

Cranes urgently load containers to prepare for the next train to export goods to China.

Mr. Nghiem Xuan Huong, Vice Chairman of the People's Council of Bac Giang province, said that before Kep station was put into operation for international transport, goods imported and exported by rail from Bac Giang had to declare import and export procedures at Dong Dang or Yen Vien station customs, then unload the goods by road to the factory, which took a lot of time and increased costs.

“The operation of Kep station for international transport will bring great convenience to businesses and form a transit hub for goods for Bac Giang and neighboring provinces, helping to reduce logistics costs. At that time, Bac Giang will be like opening an international border gate,” said Mr. Huong.

A business representative said that putting Kep station into international transit operation brings benefits in many ways: Reducing waiting time for customs procedures at Yen Vien station, which means reducing storage costs; reducing short-distance transportation costs by road from the station to the warehouse.

“Just calculating the short-distance transportation cost from Kep station to the factory in Bac Giang area compared to Yen Vien station has reduced by 35-40%. If going to Cai Lan area (Quang Ninh), it will be reduced even more,” said the representative.

Mr. Nguyen Hoang Thanh, Deputy General Director of Ratraco Company - an enterprise operating international logistics transportation, said that although Kep station has just been put into operation for international transportation, the output has reached about 600 containers.

“Regarding logistics cost efficiency, currently in the early stages of exploitation and focusing on promotion, Ratraco is coordinating with partners to reduce profits, thereby reducing total costs to regulate the flow of old goods and attract new customers to the station. Therefore, the logistics cost problem is not yet specific,” said Mr. Thanh.

Mr. Thanh added that transporting imported goods from Nanning (China) by road takes several days. In case of congestion at the road border gate, the waiting and transportation time will be extended, resulting in additional costs.

Meanwhile, if transported by rail from Nanning to Kep station, the time can be shortened to 1 day.

“Kep Station has a 1,435mm gauge railway, which is the same as the Chinese railway, so standard train cars from China can line up and leave immediately,” Mr. Thanh said, adding that from the Kep Station model, it is necessary to invest in infrastructure and open more international transit stations deep inland to reduce congestion and waiting for customs procedures for import and export goods at border gates.

How to replicate?

Loading containers onto trains at Kep station

A representative of Vietnam Railways Corporation said that Kep station is one of the railway stations included in the "Plan to improve the capacity of international freight transport by rail" submitted to competent authorities.

The goal is to bring the import and export of goods by rail deep into the inland of localities to reduce time and transportation costs; increase convenience for connectivity and logistics activities, thereby increasing output and market share of railway transport.

According to the survey, the estimated proportion of cargo volume through Dong Dang station is about 65-70%, through Lao Cai station is about 30-35%. Of which, the North-South route, Hanoi - Dong Dang, the output by 2030 is expected to be about 3 million tons by 2030.

Hai Phong - Yen Vien - Lao Cai route, the expected output is about 1.5 million tons. Thus, calculated on the two transport corridors North - South, East - West, the demand for international freight transport by 2030 will reach 4 - 5 million tons/year.

To meet this demand, according to Vietnam Railways Corporation, it is necessary to invest in freight stations, build freight yards that meet container operation standards, and warehouses that meet import and export storage standards to organize international intermodal transportation.

Accordingly, in the period of 2022-2025, for existing international transit stations, it is necessary to renovate and upgrade station infrastructure to increase customs clearance capacity and container loading and unloading at Dong Dang, Lao Cai, and Song Than stations.

Investing in upgrading the capacity of Kim Lien station, Dieu Tri station, Trang Bom station on the North-South route; Vat Cach station on the Lao Cai - Hanoi - Hai Phong route.

In the 2026-2030 period, continue to invest in building international transit stations on the two North-South and East-West corridors according to the approved railway network planning roadmap, prioritizing stations at the Hanoi hub: Ngoc Hoi, Lac Dao, Bac Hong, Yen Vien, and at the Ho Chi Minh City hub: Trang Bom station.

“Regarding vehicles, we will proactively invest in locomotives and support member businesses in the railway transport service business to rent and invest in carriages and loading and unloading equipment,” said a representative of Vietnam Railways Corporation.

In the report to the Prime Minister on the "Plan to improve the capacity of international freight transport by railway", the Ministry of Transport said that in the period of 2022-2025, 7 stations serving international freight transport will be invested, including: Dong Dang, Lao Cai, Kep, Vat Cach, Kim Lien, Dieu Tri, Song Than with a total estimated investment of 867 billion VND.

The Ministry of Transport also proposed that the Prime Minister assign the Ministry of Transport to be responsible for announcing stations with international railway transport activities, including Kim Lien, Dieu Tri, Trang Bom, Kep, Sen Ho, Ngoc Hoi, and Vat Cach stations, to have a basis for opening customs branches at the stations, making it convenient for businesses to carry out procedures.