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Exceptional Incentives and Consumption Commitments for Participating Enterprises
The Government Office has issued Announcement No. 584/TB-VPCP (dated October 28, 2025), conveying Deputy Prime Minister Tran Hong Ha’s conclusions from a meeting on the draft Decree regulating task assignments, orders, and selection criteria for Vietnamese enterprises supplying goods and industrial services for the railway sector.
The Decree aims to concretize the strategy for developing a modern, synchronized, and sustainable railway industry, focusing on key areas and gradually achieving self-sufficiency in maintenance, production of certain vehicles, materials, and equipment for urban and national railway systems, including high-speed railways.
The Deputy Prime Minister instructed the clear identification of core product categories to avoid dispersion, prioritizing orders for high-tech products related to high-speed railways to gradually master the technology.
Regarding enterprise selection criteria, the Deputy Prime Minister emphasized the need to thoroughly review factors such as capacity, experience, finance, personnel, infrastructure, and product quality, ensuring feasibility and alignment with the practical capabilities of domestic enterprises. Additionally, participating enterprises must have specific technology transfer plans and commit to a roadmap for increasing localization rates over time, with priority given to those with research institutes, engineering teams, and design-manufacturing capabilities.
For incentives, beyond the provisions in the Railway Law, the Deputy Prime Minister requested additional exceptional policies to support enterprises in research, technology transfer, workforce training, and the establishment of research institutes and laboratories, such as guarantee mechanisms. There must also be a commitment to a stable market and long-term orders for qualifying units. Selection criteria and enterprise lists must be transparent, with an independent appraisal board.
The Deputy Prime Minister tasked the Ministry of Construction with researching mechanisms and criteria for selecting Vietnamese enterprises capable of investing in production lines and equipment to ensure timely project execution, from construction to operation and maintenance. The Ministry must also assess capabilities, market scale, and propose specific policies to avoid scattered, wasteful, and redundant investments.
The draft Decree must be finalized and submitted to the Government by the Ministry of Construction before October 31, 2025.
Major Players Express Interest in Railway Projects
Previously, numerous domestic enterprises expressed their desire to deeply engage in key projects, particularly the North-South high-speed railway.
One of the pioneers is VinSpeed, a member of the Vingroup conglomerate. The company officially registered to invest in the North-South high-speed railway project, with a total investment of over $61 billion. VinSpeed pledged to contribute approximately 20% of its own capital, with the remainder sourced through domestic and international loans, and requested government support for preferential loan mechanisms and guarantees. Concurrently, the company is recruiting engineers, technology specialists, and technical transfer experts, demonstrating its commitment to mastering the value chain in this new sector.
Not to be outdone, THACO Group, led by Tran Ba Duong, has submitted a proposal to invest in the North-South high-speed railway, with a similar total capital. THACO is prepared to contribute 20% of its equity, with the remainder through commercial loans and preferential credit, provided the government supports guarantee mechanisms and market consumption commitments. The company suggests dividing the project into phases over 7 years to gradually localize technology and establish a domestic railway industry.
Meanwhile, Hoa Phat Group has chosen an “upstream” investment approach. Vietnam’s largest steel producer signed a contract with Germany’s SMS Group to implement the first high-speed rail track production line in Southeast Asia, with a capacity of 700,000 tons/year, expected to launch in Q1/2027. This move reflects Hoa Phat’s ambition to become a strategic supplier for domestic railway projects.
Additionally, Thang Long National Construction Company and Vietnam Railways Corporation have proposed collaborating to operate existing railway lines and future high-speed railway projects. Both entities aim to participate in management and operation while contributing to technical workforce and logistics development in the railway sector.
International conglomerates are also showing significant interest. Siemens AG (Germany) has expressed its desire to invest and supply equipment, locomotives, carriages, and signaling systems for the North-South high-speed railway project.
Siemens proposes technology transfer for carriage and component manufacturing in Vietnam, establishing a local supply chain and reducing equipment import costs. The Vietnamese Government has welcomed Siemens’ participation, viewing it as a crucial opportunity to access international technology and expertise.
The Mekolor – Great USA consortium has also submitted a proposal to invest in railway projects. However, their application raises concerns about financial capacity and implementation feasibility due to a lack of proven experience in similar infrastructure projects.
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