The State Railway of Thailand is at risk of going under unless it implements major reforms, Transport Minister Chadchat Sittipunt said yesterday.
"If nothing is done, the SRT will face its demise. The organisation's losses exceed 10 billion baht a year. That's 20,000 baht a minute," the minister told the Thai Railway Reform workshop.
Mr Chadchat later said that the government plans to invest 2.2 trillion baht to improve the country's overall infrastructure.
About 65% of the fund will be set aside for developing the railway system.
"It will turn a new page for the country," he said, referring to the massive infrastructure plan. "And the SRT must make changes and adapt accordingly."
The minister stressed that Prapas Jongsanguan, the SRT governor, must prepare the agency's staff to move forward with the government's infrastructure plan.
The plan calls for the government to absorb the SRT's debts by investing in railway infrastructure. The remainder of the debts must be offset by the SRT, which has an accumulated debt of 98 billion baht.
A large part of the SRT's revenue is generated through management of its vast property holdings and assets.
Three of the SRT's prime Bangkok properties _ at Phahon Yothin, Makkasan and near Maenam train station _ have not been commercially developed and are worth a combined 84 billion baht.
"The general debt problem [for the SRT] is not a concern," Mr Chadchat said.
What could pose a problem, however, is a projected decline in passengers and freight.
Mr Chadchat said trains are not a primary mode of transport for most people. About 45 million people travel by rail each year, compared with three million people using Bangkok Mass Transit Authority buses each day.
Mr Prapas said his top priority is to revamp the quality of train services. He plans to reinforce the strength of tracks and procure new train engines and wagons.
The procurements, to be completed in two years with the support of the Finance Ministry, will enable the agency to offer a punctual and safe train service, he said.
Mr Prapas said the SRT was not solely to blame for its losses. In fact, it was the fault of previous decision-makers who neglected the agency.
He said no new engines had been bought in the past 10 years, while the agency continued to accrue debts from building rail tracks.
Chula Sukmanop, chief of the Office of Transport and Traffic Policy and Planning, suggested a Railway Department be established to construct tracks, similar to the Highways Department being responsible for building roads.
The SRT could then concentrate on delivering train-related services.
Train services should be opened to private competition to improve quality, he said, while a company should be set up to manage the SRT's assets to increase returns on investments.
Chockchai Compiranonta, president of NDC Logistics Co, said there remains a strong need for rail freight transport, but customers should understand that delays can be expected.