Potentials and Constraints along the Thailand-Laos Freight Transport Corridor

Assessment of Potentials and Constraints along the Thailand-Laos Freight Transport Corridor 

The Tha Na Laeng Land Pier serves as a crucial transfer point for goods adjacent to Thanaleng Station, which operates along the Nong Khai-Vientiane railway route. Situated in Ban Dong Phosy, Hadxayfong district, Vientiane Prefecture, Laos, the station is approximately 3.50 kilometers away from the initial Thai-Laos Friendship Bridge. The Vientiane Logistics Park Company Co., Ltd has been granted a concession to develop the Na Laeng land port, including the Vientiane Capital Logistics District, covering an expansive area of 2,387.5 rai (3.82 square kilometer). This development aims to establish an international checkpoint to facilitate customs procedures in the Lao PDR.

Loading and Unloading Yard (Transshipment Yard) comprises both Meter Gauge and Standard Gauge

Strength
  • Thana Laeng Land Pier and Vientiane Capital Logistics Zone was built to be a transportation hub to facilitate both import and export activities in Lao PDR. It is equipped with product inspection and tax collection stations and serves as a pivotal location for goods transfer and exchange. 
  • It functions as an important rail freight connection point between Thailand, Laos, and China as it provides a designated area for transferring goods between the 1-meter (Meter Gauge) and 1.435-meter (Standard Gauge) rail systems.
  • Goods imported from China that transit through Laos to Thailand and other countries, undergo sorting procedures at the Na Laeng land port before being further distributed or exported.
Weakness
  • High-speed trains originating from China are presently unable to transfer goods at the Na Laeng land port due to regulatory constraints imposed by the Ministry of Public Works and Transport in Lao PDR. Consequently, freight transportation between the Thanaleng Land Port and Vientiane Southern Station is facilitated primarily through truck transportation.
  • The transshipment of containers incurs considerable costs, largely attributed to the taxation framework implemented by the Lao PDR. This taxation mechanism significantly impacts the operators involved in transporting goods along this route.

Vientiane Station (Ban Khamsawad) 

The Thai-Laos Railway Construction Project Phase-2 (Part-2) has received loan support (70% of the total budget) from the Thai government. It is the final station along the Nong Khai-Vientiane Railway Line. There is an extension from the station that spans approximately 7.5 kilometers across a dry rice field, utilizing a path size equivalent to 1 meter. 

Vientiane Capital Railway Station Platform (Ban Khamsavat)

Strength
  • The station provides only passenger transportation services. For container transportation, the shipping and transshipment operations are conducted at the Thanaleng Land Port. Bus services are provided in Laos, necessitating a driver change from Thai to Laos personnel. This arrangement is in accordance with the agreement governing the Thai-Laos train route, which stipulates that Thai employees are protected only up to Thanaleng station.
Weakness
  • Passengers connecting to the China-Laos high-speed railway station need shuttle bus services, as there is currently no direct rail system connection available.
  • The station is not operational yet as it awaits the readiness of high-speed trains from China, training sessions on vehicle operations and driving for railway officials of the Lao PDR.

Nong-Khai Station

Nong Khai station serves as the final stop in Thailand before connecting to Tha Na Laeng Station in the Lao PDR. Immigration officers are stationed at Nong Khai to serve passengers travelling to and from Thailand. Currently, several trains are operating between Nong Khai and Tha Na Laeng, with a total of four trains making round trips each day, with Customs officers providing inspection and release services for export and cross-border goods. Transporting goods through temperature-controlled containers requires submitting the container drawings to engineers for initial verification of whether the containers to be used can be used to carry goods according to SRT regulations or not, thereby mitigating the risk of delivery issues.

The area around Nong Khai Station

Strength
  • One-stop service for passengers who seek to cross the border between Thailand and Lao PDR, with the assistance of immigration officers at Nong Khai Station through the timing of their bus trips.
Weakness
  • The size limitations of Thai railway tracks are smaller compared to those connecting to trains originating from China. Consequently, exports of goods from Thailand to China necessitate transshipment for further transport to China at the Na Laeng land port in the Lao PDR. This process incurs additional costs and expenses. Moreover, passing through the Pasi checkpoint of the Lao PDR and the waiting time for inspecting goods at the checkpoint can impact the market price at the shipping destination.  
  • The bus route of Nong Khai-Tha Na Laeng-Nong Khai has a relatively low volume of passengers crossing the border via the rail system. However, in anticipation of potential future increases in passenger volume or demand for rail system usage, it is planned to increase bus operations to 7 times per day. It's important to note that this increase in bus operations may impact traffic density around the bridge, as the bridge needs to be closed to vehicular traffic every time a train passes through.

Natha Station

The station is planned for development into a Container Yard, Transshipment Yard and Depot, once the construction of the new Thai-Laos bridge is completed. There is a plan to construct a 1.435-meter road to connect the China-Laos high-speed train to Natha Sation, as well as a separate 1-meter road on the same bridge.

The area around Natha Station

Strength
  • There will be a cargo transfer center that increases efficiency and ability to transfer from 1-meter to 1.435-meter rails and reduces the burden on export operators. This infrastructure will result in Thailand having the potential to compete better in foreign markets.
Weakness
  • The construction schedule for the 2nd Nong Khai Friendship Bridge remains unclear, consequently impacting the development timeline for Natha Station.
  • Plans to increase capacity in the future to support the transportation of agricultural products. The container yard will have supporting facilities such as charging points for temperature-controlled containers (Reefers) for temperature-controlled shipping, etc.
  • Limitations on the size of the Subdistrict Municipality vehicles used for temperature-controlled shipping, which can only accommodate a 40-foot reefer container due to the protrusion of the clip-on part at the back of the cabinet. Conversely, the reefer cabinets on sub-district buses in China are larger. Therefore, measures need to be explored to support such transportation in the future.

Udon Thani Industrial Estate

The Udon Thani Industrial Estate, located in the Northeast Economic Corridor (NeEC) area within the industrial estate, is poised to develop into an area for packing and sorting stations, ICD boxes, a CY container yard, and a Free Zone which is envisioned to serve as a central region (Logistics Hub) in the future.

Area surrounding the Industrial City of Udon Thani

Strength
  • The plan involves developing rail system connections from Nong Takai Station into the ICD area within the Udon Thani Industrial Estate. This initiative aims to streamline import-export operations for entrepreneurs efficiently.
  • The location is along both the double-track railway line and the high-speed railway line, which serves as a strategic point for connectivity with neighboring countries (CLMV), positively impacts product distribution in the upper Isaan region, leading to cost reductions and increased competitive advantages for Thai entrepreneurs in the export market.
  • ICD is designed to operate as a One-Stop service point, where customs officials conduct inspections of goods. Additionally, facilities are in place to provide charging services for temperature-controlled cabinets while awaiting inspection.
Weakness
  • The number of rail freight trips is relatively small whilst the demand for sugar products reaches up to 10,000 trips per day and preparations are underway to combine bulk products for transportation by rail.
  • Concerns of operators regarding potential restrictions on the number of train frequencies at Nong Takai Station, particularly in light of future transportation needs. The Industrial Estate suggested adding extra train trips to facilitate the pickup and delivery of products within the industrial estate, thus enhancing transportation efficiency.
  • The fruit quarantine station takes time to check in many steps which led to product damage, increased costs for SMEs, and affected sales prices sent to China. As a solution, the operators encourage the assignment of fruit inspectors at industrial estates to reduce inspection time. Additionally, they suggest providing cold room services for storage purposes.

List of Authors

1) Mrs. Yaowalak Sunthornnon, Advisor

2) Ms. Phattharasuda Wichayapong, Senior Researcher

3) Miss Uma Phongkitdechhot, Researcher

4) Mrs. Nichapat Blake, Researcher

5) Mr. Teerapat Phukerd, Researcher

6) Mr. Kiattiphum Noisuwan, Researcher

7) Ms. Pimchanok Panthai, Analyst

8) Miss Phakwan Poonjitborisut, Technologist

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