The Exim Bank of China has offered Thailand a 20-year loan for the construction of two new railway lines, Deputy Transport Minister Arkhom Termpittayapaisith said on Thursday, but the terms will need to be renegotiated.
The offer was discussed in a meeting on investment and finance for the train project on Thursday.
Mr Arkhom said the Chinese bank had offered a loan with an interest rate ranging from 2 to 4% and a four-year interest-free period with conditions attached.
The conditions included a requirement for the project to use Chinese technology and give China responsibility for the design and civil work, the deputy minister said. China also wanted to manage the routes in exchange for the loan, he added.
In December Chinese companies won the right to build the country's first 1.423 gauge tracks from Nong Khao to Map Ta Phut in Rayong via Kaeng Khoi district in Saraburi and from Kaeng Khoi to Bangkok. Construction will be divided into four sectors to speed up the project.
Thailand and China are yet to agree on the form of investment for the scheme.
The Exim Bank's conditions were not acceptable as Thailand remained firm on managing the trains on the new tracks.
The interest rate for the loan was also too high and Thailand had asked Beijing to lower it, he added.
''The meeting agreed that the interest rate was too high compared with the loan from the Japan International Cooperation Agency for the construction of the Airport Rail Link, which was charged only at 1.5%,'' he said.