The Thai government has decided to entrust a consulting firm to design an extended railway route linking Nong Khai province in northeastern Thailand with Thanaleng in Laos. The railway route will also link Thanaleng with Vientiane, the Lao capital.

According to the Neighboring Countries Economic Development Cooperation Agency (NEDA), the new route is 12 kilometers in length and requires a budget of one billion baht. Construction of the project will begin in 2011 and the objective is to facilitate the travel of tourists and transportation of goods between Thailand and Lao PDR. The project will also help increase trade and investment between the two neighboring countries.

NEDA is conducting a feasibility study on Route R 11 linking Loei province in the Northeast with Vientiane, which will connect further with Luang Prabang. The Cabinet will be asked to approve a budget of 1.4 billion baht to construct this route. Thailand has recently signed a cooperation agreement to offer financial assistance of 655 million baht to Lao PDR to carry out two projects.

The first project involves 405 million baht for use to improve Route R 3, which links Chiang Rai in northern Thailand with Kunming in southern China via Houayxay in Laos, The route is expected to contribute significantly to Thailand’s trade and investment with neighboring countries and to the ASEAN region as a whole. It is also in response to Thailand’s logistics development policy, which will reduce transportation costs and promote tourism.

The second project involves 250 million baht for use to ease traffic congestion and the flood problem in Vientiane. The project will be completed in time for the celebration of the 450th anniversary of Vientiane as a capital of Laos in November 2010. With this project, tourists and business people will find it more convenient to travel from Thailand to Laos and China and vice versa. This will promote cross-border trade in the three countries, as well.

The financial assistance for these projects is in the form of a soft loan, with an annual interest rate of 1.5 percent and a grace period of five years. NEDA has already provided 3.2 billion baht in financial support for Laos to carry out six projects to develop transport and communications.

Meanwhile, the Thai-Lao Friendship Association will hold a general assembly in Mukdahan province on 10 June 2010, with a discussion on Laos’ investment promotion law. On the following day, June 11, both the Thai-Lao Friendship Association and the Lao-Thai Friendship Association will hold a joint meeting in Savannakhet in Laos. Prime Minister Abhisit Vejjajiva has recently approved the appointment of Dr. Virabongsa Ramangkura as Chairman of the Thai-Lao Friendship Association for the term 2010 – 2012.

The Ministry of Foreign Affairs is planning to organize various activities in celebration of the 60th anniversary of Thai-Lao diplomatic relations between 19 December 2010 and 19 December 2011. The Phase II of the Thai-Lao railway project linking Bangkok with Vientiane will be publicized as part of the celebration.