Vietnam’s Railway Industry: Strong Policy Commitment, but Legal Framework Remains a Bottleneck

Vietnam’s Railway Landscape: 2025 - 2050 Outlook

Under the national railway development plan to 2030, Vietnam aims to upgrade seven existing railway lines and construct two new high-speed railways. By 2050, the national network is expected to expand to 25 lines with a total length exceeding 6,300 km.

Among these projects, the North – South high-speed railway, spanning over 1,500 km across 15 provinces with a total investment exceeding USD 67 billion, is currently undergoing feasibility studies and is expected to be fully completed by 2035. Meanwhile, the Lao Cai – Hanoi – Hai Phong railway line, stretching 390 km with an estimated investment of USD 8.4 billion, is targeted to become operational in 2030. Vietnam’s two largest cities, Hanoi and Ho Chi Minh City, are also planning urban railway systems exceeding 500 km each, creating substantial development opportunities for the railway industry.

Notably, the National Assembly has approved 19 specific policies aimed at accelerating procedures, incentivizing investment, mobilizing social resources, and developing human capital. At the same time, the revised Railway Law is being further refined to institutionalize policies related to planning, land use, investor selection, and technology transfer – laying a critical legal foundation for the sector’s next growth phase.

Deputy Minister of Construction Nguyen Danh Huy emphasized: “In the context of Vietnam’s infrastructure development, railways serve as the backbone of the national transport system, playing a vital role in economic restructuring, logistics cost reduction, greenhouse gas emission mitigation, and regional connectivity. The railway sector must develop a domestic industrial ecosystem, strengthen local supply chains, and enhance international cooperation in training, technology transfer, and long-term investment.”

Recommendations from Vinh Hung JSC

Speaking at the forum, Mr. Luong Vo Ta, CEO of Vinh Hung Trading, Consulting and Construction Joint Stock Company (Vinh Hung JSC), stated that the coming decade represents a “golden period” for Vietnam’s railway industry. However, after more than a century of development, domestic railway industrial capacity remains underinvested, with manufacturing capabilities still lagging behind global standards. While incentive and investment promotion policies have been introduced, they remain insufficiently robust.

From a business perspective, Mr. Luong noted: “Compared with international benchmarks, Vietnam’s railway industry is still at an early stage of development

According to Mr. Luong, although the Government has demonstrated strong determination by issuing priority policies to promote investment in railway industry, the sector still involves significant risks, requires substantial capital, and faces a limited market scale. “Without a comprehensive legal framework and effective support mechanisms, enterprises will struggle to make long-term investment decisions.”

One critical issue highlighted was the need to establish unified technical standards and design specifications across railway projects. This was identified as a prerequisite for creating a sufficiently large and consistent market to encourage long-term investment and deeper localization: “Clear and unified standards give enterprises the confidence to invest at scale and accelerate localization. In addition, the Government should work in partnership with businesses by ensuring long-term policy transparency and stability, while creating favorable conditions for the effective implementation of public–private partnership (PPP) models and international technology joint ventures.”

Vinh Hung’s representative also proposed that the Government promptly issue a comprehensive legal and incentive framework to establish a clear and stable investment environment. In parallel, policies on taxation, credit support, and especially the prioritization of domestic enterprises in contractor selection should be strengthened.

Enterprises Proactively Seizing Opportunities

Mr. Tran Thien Canh, Director General of the Vietnam Railway Authority, and Mr. Khuat Viet Hung, Chairman of Hanoi Metro, witnessed the signing ceremony of a Memorandum of Understanding (MOU) between Vinh Hung and its partners Vossloh and Maccaferri

Vietnam’s railway sector continues to hold vast growth potential, as rail transport currently accounts for only around 1% of total freight and passenger turnover nationwide. Investments in the North – South high-speed railway and international rail connections are expected to create breakthrough opportunities for both the transport sector and for a broader economy.

Anticipating this momentum, Vinh Hung has established strategic partnerships with global industry leaders such as Vossloh and Maccaferri. The Vinh Hung – Vossloh – Maccaferri collaboration marks a significant milestone in the localization of railway technology and equipment manufacturing in Vietnam. The three parties will jointly research, transfer, and manufacture railway fastening systems, turnouts, slope protection solutions, and engineering systems for complex terrains that meet international standards, produced directly at factories in Vietnam. These products will serve not only domestic demand but also target export markets and international infrastructure projects.

Vinh Hung is currently the first and only enterprise in Vietnam’s transport sector to be awarded the “Vietnam Value – National Brand” title.

Founded in 2006, Vinh Hung operates across three core areas: Manufacturing – Trading – and Construction. With nearly two decades of development, the company’s technological solutions and products, such as bridge bearings, expansion joints, and noise barriers, have been widely applied across the North – South Expressway and most key national transport projects, while also being exported to markets throughout Asia and the Americas.