The Board of Investment (BoI) on Friday approved special measures to promote investment in rail and rail-related industries, projecting demand to top 10,000 trains over the next 20 years.
Prime Minister Prayut Chan-o-cha, who chaired yesterday's board meeting, said now is an opportune time to promote the rail industry, as domestic demand for trains has reached sufficient economies of scale to establish train manufacturing in the country.
The government aims to increase Thai competitiveness in the rail industry and reduce train imports, Gen Prayut said.
Over the next 10 years, plans call for developing a 6,000km network with double-track, electric and high-speed rail.
BoI secretary-general Duangjai Asawachintachit said the board's special measures will be offered for making train cars, significant parts of the operator's cab, signalling and braking systems, couplers, rails and power supply.
Under the special measures, investment in train cars with domestic engineering designs will be entitled to a corporate income tax exemption for eight years.
Interested parties who submit applications to the BoI by Dec 30, 2021 will be granted a 50% reduction in corporate income tax for three to five years.
The measure aims to accelerate investment within three years.
Projects with factories located in Khon Kaen and Nakhon Ratchasima will be allowed to enjoy a 50% reduction in corporate income tax for five years.
"Khon Kaen and Nakhon Ratchasima are now steel and metal parts manufacturing bases in the Northeast, which has the potential to be developed into the rail industry cluster," Ms Duangjai said.
In a related development, the board approved in principle offering privileges for smart city development at the State Railway of Thailand's central station in Bang Sue district.
The project offers an eight-year corporate income tax exemption to investors.
Ms Duangjai said the board also yesterday agreed to improve the policy to promote the tourism industry. The BoI will extend privileges to cover museums on top of the existing aquariums.
The scale of investment eligible for the privilege has also been eased to 30 million baht from 100 million. The measure aims to attract investors to second-tier provinces.
The board also added two new categories to enjoy promotional privileges: cruise terminals with the purpose of supporting infrastructure for marine tourism, and large-scale man-made tourism spots with an investment of up to 100 million baht.
In addition, the board approved privileges for IRPC's paraxylene production project worth 35.96 billion baht. Paraxylene is a raw material for polyester and related industries.
