The draft amended Railway Law introduces provisions to encourage private organizations and individuals to invest in railway infrastructure through various forms of contractual agreements, signaling a shift toward more diversified and decentralized development of Vietnam’s railway system.

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Minister of Construction Tran Hong Minh presents the draft amended Railway Law. Photo: National Assembly

On May 27, Minister of Construction Tran Hong Minh, authorized by the Prime Minister, presented the Government's proposal on the revised Railway Law, which includes several breakthrough policies to foster railway growth.

Diversified funding and public-private partnerships

The draft law aims to maximize local and private sector resources by allowing investments in railway infrastructure through multiple contract models such as BT (Build-Transfer), BOT (Build-Operate-Transfer), BTO, BLT (Build-Lease-Transfer), and BTL (Build-Transfer-Lease).

“Local governments are permitted to use their own budgets to fund land clearance, resettlement support, and certain infrastructure components of the national railway system,” said Minister Minh.

The draft also clearly defines the responsibilities of different stakeholders in the construction of national, local, and specialized railway systems.

“These legal provisions lay the groundwork for infrastructure investment, including joint-use structures like dual-purpose rail-road bridges such as Lach Huyen and Can Tho 2,” the minister noted.

Attracting private operators through leasing and management rights

To diversify the types of enterprises involved in railway management, the bill introduces mechanisms for time-limited leasing and transfer of rights to exploit state-invested railway assets. Management models such as “public leadership - private management,” “public investment - private operation,” and “private investment - public use” are encouraged.

The draft also seeks to modernize railway vehicle registration, tailoring inspection processes to each type of railway, and simplifying administrative procedures related to evaluation and certification while maintaining alignment with international standards.

Industrial development and workforce training.

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Committee Chairman Le Quang Huy addresses oversight issues in the draft law. Photo: National Assembly

The law proposes classifying certain railway products as high-tech items, making them eligible for priority support. This aims to attract investment, build a robust railway industrial base, and foster the development of supporting industries.

Decentralization and streamlining authority

A key innovation in the draft law is the strong decentralization of authority to local governments. Certain responsibilities formerly held by the Prime Minister will now be transferred to the Minister of Construction and provincial authorities. These include approval of railway station and route plans and determining service life standards for railway vehicles.

Specifically, local governments will take over 10 administrative procedures, including:

Approval and licensing of level crossings for local and specialized railways
Issuance of railway vehicle registration certificates
Licensing of train drivers for local and specialized lines

The Minister of Construction will now oversee detailed regulations on the lifespan of railway vehicles, a role previously assigned to the government under the 2017 Railway Law.

Oversight and financial support for social-purpose rail transport

Le Quang Huy, Chairman of the National Assembly’s Committee on Science, Technology, and Environment, said the committee supports the scope and applicability of the draft law. However, he urged clearer definitions regarding urban railways, high-speed rail, and specialized rail systems, as well as rules on railway business and the management of land surrounding train stations.

He also recommended that the Government seek higher-level approval for specific mechanisms related to railway land development to ensure legal consistency and alignment with Party and State policies.

On financial support for railway services that serve public welfare or special missions, Huy emphasized the need to clarify the criteria for reasonable cost calculation, reimbursement procedures, and transparency in funding processes.

The Vinh