Vietnam Signs Ineco Consultancy Deal for $67 Billion North-South High-Speed Railway

Spanish consortium to define the railway's cost and design

Vietnam's Ministry of Construction has signed a consultancy contract with Spain's Ineco for the proposed $67 billion North-South high-speed railway, moving a project connecting Hanoi and Ho Chi Minh City into detailed preparation. The planned line would stretch approximately 1,541 kilometers, with a design speed of 350 kilometers per hour and a completion target of 2035.

Deputy Minister of Construction Nguyen Danh Huy announced the agreement on Friday. Ineco, Spain's largest public engineering consultancy, will lead the feasibility study, prepare cost estimates and establish criteria for selecting construction contractors. Its advice will also cover technology and technical standards suited to Vietnam's geographical conditions and international best practices.

Ineco will work in a consortium with French engineering company Artelia and Vietnamese firm RCIC. Spain's national railway operator, Renfe, will participate as a key collaborator. The group has more than ten months to complete its preparatory work, including studies of technical, economic and operational feasibility.

The assignment will turn the project's broad ambitions into a more precise engineering and financial plan. A feasibility study examines whether a railway can be built and operated as intended, what it would require and how much it would cost. Basic engineering will define the scope, requirements and construction costs before authorities settle the investment model.

The agreement brings Spanish railway expertise into one of the largest infrastructure investments in Vietnam's history. Spain's Alta Velocidad Espanola (AVE) network ranks as the world's second-longest high-speed railway system, giving the consortium experience relevant to the scale of Vietnam's proposed corridor.

A 1,541-kilometer route with 28 stations

The North-South railway is planned to pass through 20 provinces and cities along Vietnam's dense economic corridor. It will connect the capital, Hanoi, with Ho Chi Minh City, the country's economic hub, through a network of 23 passenger stations and five cargo stations.

Government Resolution 106, issued in April 2025, sets a design speed of 350 kilometers per hour and a load capacity of 22.5 tons per axle. The axle figure describes the weight that each axle of a railway vehicle places on the track. Together, these specifications would put the route among Southeast Asia's most advanced railway systems.

The estimated investment requirement is VND 1.7 quadrillion, approximately US$67 billion. Establishing a more precise total is one of the consortium's central responsibilities, linking its engineering work directly to decisions about how Vietnam will finance the railway.

Ineco will lead work on alignment design, meaning the route the tracks follow, as well as civil works, tunnels and structures. Its responsibilities also cover energy supply, architecture and electromechanical systems, the electrical and mechanical equipment needed for the railway to function.

The consortium will use Building Information Modeling methodology. This approach brings engineering information into a coordinated digital model, helping the different parts of a large construction project fit together. For a railway crossing numerous localities, that coordination connects decisions about the route, stations, structures and equipment.

The study therefore has two closely connected tasks: defining what Vietnam intends to build and establishing the requirements against which contractors will be selected. Authorities will finalize the investment model after the feasibility study report is completed.

Who will pay, and who will carry the risk?

Vietnamese authorities are considering three investment models: construction funded by the state, private investment, and a public-private partnership. In a partnership, the state and businesses share responsibilities under an agreed arrangement. The choice will determine how the railway's costs and risks are divided.

Prime Minister Pham Minh Chinh has directed relevant agencies to examine all three options while balancing the interests of the state, the public and businesses. He has also called for safeguards against corruption, negative practices, and the loss or waste of public assets.

Deputy Minister Huy explained that attracting private resources would go alongside a continuing state role in public services. Describing the government's approach to allocating risk, he said:

The State policy is to mobilize social resources but it is not possible to transfer all risks to enterprises. For public services in which the private companies finds it difficult to participate, the State will retain a leading role.

Huy's statement places the financing debate alongside the railway's public service purpose. Businesses may contribute capital and expertise, while the state retains a leading role where private participation is difficult. The final arrangement has not yet been decided.

The feasibility work will provide the cost and technical information needed for that decision. A project estimated at $67 billion requires authorities to consider the engineering plan and the financing structure together, because the scope of construction determines how much money must be raised.

Vingroup withdraws as other companies show interest

Vingroup, the conglomerate owned by Vietnam's richest billionaire, Pham Nhat Vuong, withdrew its bid to build the railway last month. The company said the decision would allow it to concentrate resources on other infrastructure projects that had already been approved.

Those projects include a sports complex meeting Olympic standards and covering 9,000 hectares in Hanoi, the 54-kilometer Ben Thanh-Can Gio metro line in Ho Chi Minh City, and a 120-kilometer high-speed railway linking Hanoi with Ha Long Bay.

Vingroup had proposed contributing 20 percent of the North-South railway's capital. It sought to borrow the remaining 80 percent through government loans carrying zero interest and repayable over 35 years. Its withdrawal removes that proposal from the field while the government continues considering its investment options.

Automaker Truong Hai has also proposed contributing 20 percent of the investment capital as equity, with the balance coming from foreign and domestic loans. Equity is money committed by an investor as its own stake in a project, rather than money borrowed for repayment.

The two proposals therefore offered the same stated equity share but different borrowing arrangements. Vingroup sought government loans at zero interest, while Truong Hai proposed loans from domestic and foreign sources. The terms of financing matter alongside the size of the investor's initial contribution.

Steel manufacturer Hoa Phat has begun constructing a plant specifically to supply materials for the railway. An alliance between Vietnamese company Mekolor and American entity Great USA has also expressed an intention to participate, claiming access to $100 billion in investment funds. These companies represent different possible roles, from supplying materials to contributing investment capital.

Spain's diplomatic push becomes an engineering contract

Vietnam and Spain elevated their relationship to a strategic partnership in December 2009. Railway cooperation has since become a concrete part of efforts to deepen that relationship, with the Ineco contract following increased commercial activity after Spanish Prime Minister Pedro Sanchez visited Vietnam in April 2025.

During that state visit, Sanchez expressed Spain's readiness to cooperate and share railway expertise with Vietnam. The consultancy agreement now gives Spanish companies a leading preparatory role in Vietnam's most ambitious infrastructure initiative.

Prime Minister Chinh and Sanchez discussed further steps to strengthen the partnership during another meeting in June 2025. Railway development was among the areas they addressed. Sanchez, Spain's prime minister, reaffirmed his country's willingness to support Vietnam:

Spain, which boasts the world's second-longest high-speed railway system, is ready to cooperate and share expertise with Vietnam in this field.

For Ineco, the award is a strategic milestone in its international activity. It positions Spain's public engineering sector as a reference for the development of major high-speed railway corridors, while giving Vietnam access to experience from an established network.

The diplomatic discussions have also covered what Vietnam will need after construction. Technology transfer and training are part of the cooperation agenda, connecting the immediate consultancy assignment with the longer task of developing a domestic railway industry.

Training and operations extend beyond construction

Vietnam has explicitly requested Spanish assistance with technology transfer and human resources training. Prime Minister Chinh has indicated plans to send working groups to Spain to learn from its experience in developing railway industries.

Technology transfer means passing on the knowledge and practical skills needed to use, maintain and develop railway systems. Vietnam's aim extends beyond completing the tracks and stations: it wants domestic capacity for the railway's operation and maintenance over the years that follow.

Renfe's participation also has a commercial purpose. The Spanish operator is positioning itself for potential future operations contracts and aims to generate 10 percent of its revenue from international markets by 2028. Its role in the consortium connects engineering preparation with experience in running railway services.

Renfe established a strategic alliance with Central Japan Railway in 2025 to compete jointly for international high-speed railway projects. Ineco and Renfe have also worked together on the Desert High-Speed Rail line between Medina and Mecca in Saudi Arabia.

Vietnam is preparing its workforce through a training scheme extending to 2035. Hundreds of engineers and experts are receiving education domestically and abroad, with the goal of gradually mastering core technologies and reducing dependence on foreign expertise over time.

The training timetable reaches the same year as the North-South railway's completion target. That gives workforce preparation a direct connection to the construction program: Vietnam needs people able to manage the systems that the international consortium will help specify.

December 2026 groundbreaking remains the target

The Vietnamese government is targeting groundbreaking ceremonies in December 2026 and full completion in 2035. The resulting construction window of about nine years forms part of the country's wider effort to modernize infrastructure and achieve double-digit economic growth.

Prime Minister Chinh has called for a shift from building institutions to implementing projects. At meetings of the Steering Committee for key national railway projects, he instructed agencies to apply six principles of clarity: clear responsibilities, tasks, timelines, accountability, outputs and authority.

The Ministry of Construction has assigned the Thang Long Project Management Board as project owner, replacing the Railway Project Management Board. The change is intended to strengthen oversight of quality, progress and costs as preparation advances.

Local authorities have been instructed to speed up land clearance, ensure lawful and fair compensation, improve living conditions for resettled residents and prevent corruption. Those requirements make land preparation and the treatment of affected communities part of the implementation timetable.

Authorities are also reviewing domestic and international standards to identify technology options suited to Vietnam's geographical and economic conditions. The main milestones place the consultancy work within a wider sequence of diplomatic commitments, project preparation and construction targets:

• December 2009: Vietnam and Spain elevated their relationship to a strategic partnership.
• April 2025: Sanchez visited Vietnam, and the Vietnamese government issued Resolution 106 setting key railway specifications.
• June 2025: Chinh and Sanchez discussed deeper cooperation, including railway development.
• December 2026: Vietnam targets groundbreaking ceremonies for the North-South high-speed railway.
• 2028: Renfe aims to obtain 10 percent of its revenue from international markets.
• 2035: Vietnam targets completion of the railway, while its railway workforce training scheme also extends to this year.

New laws and standards support railway expansion

The North-South line is the centerpiece of a broader railway modernization program that entered an accelerated implementation phase in early 2026. Vietnam has, for the first time, issued specific standards and technical regulations for high-speed rail.

The framework includes nine construction technical regulations, 219 national standards specific to the sector, 37 general standards and 146 standards aligned with European and international benchmarks. These rules provide the technical foundation for the systems now being studied.

Four related laws have also been promulgated: the revised Railway Law, Construction Law, Law on Planning and Law on Investment. They support special mechanisms intended to simplify administrative procedures and shorten project preparation, alongside technology transfer and development of Vietnam's railway industry.

The legal changes and engineering standards address different parts of the same task. Laws govern how projects are prepared and carried out, while technical requirements guide the design and construction of the railway itself. Both sit behind the government's push to move from institutional preparation into implementation.

A parallel railway brings deadlines with China

Vietnam is also advancing the Lao Cai-Hanoi-Hai Phong railway, including cross-border connections with China. Component Project 1 has already broken ground, while feasibility studies for Component Project 2 are being accelerated, with approval targeted for June 2026.

The government plans to complete an agreement with China on a cross-border railway bridge by March 2026. That deadline and the June approval target are near term steps in the wider railway program, alongside preparation for the North-South route's planned groundbreaking in December.

The projects bring together several demands on Vietnam's railway institutions: defining technical requirements, preparing investment decisions, managing land clearance and training engineers. The North-South consultancy contract supplies a central part of that effort by establishing the design, costs and contractor requirements for the country's largest proposed railway corridor.

Key Points

• Ineco will lead feasibility work for Vietnam's approximately 1,541-kilometer North-South high-speed railway, estimated at VND 1.7 quadrillion, or $67 billion.
• The consortium includes Artelia and RCIC, with Renfe collaborating, and has more than ten months for preparatory work.
• The route is designed for 350 kilometers per hour, with 23 passenger stations and five cargo stations across 20 provinces and cities.
• Vietnam is considering state funding, private investment and a public-private partnership before choosing its investment model.
• Vingroup withdrew its bid last month, while Truong Hai, Hoa Phat and the Mekolor-Great USA alliance remain interested in participation.
• The government targets groundbreaking in December 2026 and completion in 2035, supported by new laws, technical standards and workforce training.
• The parallel Lao Cai-Hanoi-Hai Phong project has a bridge agreement target of March 2026 and a Component Project 2 approval target of June 2026.