New Urban Railway Policies for Vietnam’s Major Cities

The Ministry of Transport is working on a resolution that will introduce six targeted policy groups aimed at improving land management and enhancing the autonomy of Hanoi and Ho Chi Minh City in the development of urban railways.

During the extraordinary ninth session of the 15th National Assembly, lawmakers are set to evaluate a pilot resolution that proposes specific actions and guidelines to speed up the urban railway systems in Vietnam’s two largest cities.

A representative from the Ministry of Transport mentioned that this draft resolution will focus on six essential policy areas key to addressing funding, project management, land use, technology transfer, construction materials, and local regulations.

The main goal is to secure a range of financial sources for an extensive urban railway network. This includes ensuring flexible funding allocations from both central and local budgets, as well as exploring options like official development assistance (ODA) and concessional loans.

Both Hanoi and Ho Chi Minh City are suggesting that the Prime Minister be given the authority to balance and allocate investment budgets during project phases.

The proposed financial limits are around 215.35 trillion VND (approximately $8.61 billion) for Hanoi and 209.5 trillion VND (about $8.38 billion) for Ho Chi Minh City during the investment cycles of 2026-2030 and 2031-2035.

This resolution aims to reduce project durations by fast-tracking preliminary phases and decentralizing authority for project evaluation and approval. The resolution also seeks to address issues related to costs and expedite the selection of contractors and financial disbursements.

A significant aspect of urban development will involve the Transit Oriented Development (TOD) model, which merges land and transport planning to improve efficient land use around metro stations. This strategic approach aims to maximize investment returns and ensure sustainable growth for urban railways.

The resolution will set forth particular rules for applying relevant technical standards for urban railway projects and will focus on technological innovation, workforce training, and industrial advancements to facilitate long-term railway growth.

Additionally, the initiative aims to simplify processes and decentralize authority to maintain a steady supply of construction materials and disposal sites, ensuring that urban railway constructions proceed on schedule.

Ho Chi Minh City will gain similar regulatory advantages as Hanoi under the Capital Law, particularly regarding revenue generation in TOD areas, debt management, and public debt ceilings.

Moreover, regulations regarding investor selection, environmental assessments, and administrative decentralization will be harmonized between both cities to promote a cohesive policy for urban railway development.

Deputy Minister of Transport Bui Danh Huy remarked that these proposed policies have been thoroughly vetted for their potential impact and are anticipated to yield notable advantages.

Bui Xuan Cuong, former head of the Ho Chi Minh City Urban Railway Management Board and the current Vice Chairman of the municipal People’s Committee, noted that metro projects often encounter constraints stemming from both international agreements and local laws, causing slow decision-making and delays.

Cuong argued that granting more autonomy to local authorities would enhance project management efficiency and engage key stakeholders more actively in implementation. He highlighted the necessity for customized policies that would support effective execution.