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Moscow to Beijing by Rail: In 30 Hours?
| published November 21, 2014 |

By Thursday Review staff

 

For a business executive in Moscow to get to Beijing, he or she would have two basic choices: fly, which would be one reasonable way to get from capital to capital; or, take the train. Flying is obviously faster. But a trip by train would allow for both expansive scenic beauty as well as time for thinking, strategizing, studying data, organizing, and composing contracts or letters on a laptop. For a tourist, say a Chinese family seeking to spend a week in Moscow, the train ride across Russia would include spectacular sights and scenery.

What’s the drawback of the train option? It takes between four and five days to travel from the Russian capital to the Chinese capital by conventional rail. As the crow flies, the distance is 5,790 kilometers, but more than 9000 kilometers of travel distance as the tracks wind their way across rugged Asia. That’s 5,753 miles, for those who don’t have their metric conversion charts handy.

But if a bold new proposal by Russian President Vladimir Putin gains traction (pun intended), businessmen and tourists could make the rail journey from Moscow to Beijing in about 30 hours. As part of a complex set of negotiations between Putin’s top Russian business partners and their counterparts in China, including Prime Minister Li Keqiang, Russia would spend roughly $60 billion to build the longest high speed rail network ever attempted. The tracks would connect with a super station near Moscow, and roll across Russia toward China, where the rail system would eventually terminate at Beijing. The estimated $60 billion would pay only for the high speed rail from Moscow, through Kazakhstan, to the border with China near the Dzungarian Gate, west of Urumqi. China would pay for the remaining rail to link from Urumqi east to Beijing.

The announcement came via Alexander Misharin, a senior vice-president with the Russian state-run rail and transportation conglomerate, OAO Russian Railways. The announcement about plans for the massive rail project accompanied the nuts and bolts of a new deal between Russian oil and gas companies, and China. Russia is seeking new partners outside of its normal markets for oil and gas in an effort to stimulate its economy, which many international business analysts say has slipped into a deep recession since U.S. and U.K.-led sanctions were imposed earlier this year. Those sanctions were targeted at Russia—as well as some of Putin’s closest political allies and billionaire cronies—as punishment for Russia’s aggressions in the Ukraine.

Russia hopes to boost its sagging economy and stave off worse recession by selling oil and gas to energy-hungry China. It also hopes that the new high speed rail system linking Beijing to Moscow will foster more business ties, increase business travel, and bolster tourism for Russia.

The parallel deal for China to buy oil and gas included a $400 billion agreement for China to buy Russian oil and gas from OAO Gazprom—one of Russia’s largest energy companies—along with a combined project to construct a massive pipeline to connect Russian refineries and distribution centers with Chinese receiving and distribution facilities near the border with Mongolia.

Both China and Russia have reason to see the huge projects succeed. With China’s industrial and manufacturing sectors growing at a healthy clip, energy is always in demand. Though many analysts say that Moscow needs to encourage diversification in its economy, Russia is desperate to generate cash, and it is willing to rely on its abundance of natural resources.

Misharin described the massive project as being comparable to the great Suez Canal endeavor in terms of its scope and game-changing effects. The rail system will require many hundreds of high-speed passenger trains and cars, as well as hundreds of high-speed freight trains—all specially-designed for the engineering specifications and the terrain. The systems may also require thousands of miles of road improvements or new road construction to enable crews to work.

The cost of the dual projects—oil and gas pipeline, high speed rail line—will be staggering, perhaps more than what both the Russian treasury and Russian companies can fund, but Moscow hopes to lure large investors from both China and from other countries as well. Once the plans are resolved and the lion’s share of the funding secure, construction will begin and would take about ten years to complete.


Related Thursday Review articles:

The Economic Impact of Ukraine’s War; R. Alan Clanton; Thursday Review; August 25, 2014.

Sanctions Talk, Money Walks; R. Alan Clanton; Thursday Review; July 31, 2014.