China Focus: Rail investment back on track (3)

However, a lack of funds has been a persistent problem for the Ministry of Railways, especially when it is struggling to cope with rising operating costs and mounting debts.

The ministry's debt-to-asset ratio climbed to 61.81 percent at the of September, official data showed.

The ministry's after-tax losses stood at 8.54 billion yuan during the first nine months of the year, compared with annual profits of 15 million yuan in 2010 and 31 million yuan in 2011, respectively.

By the end of September, the ministry's total assets totaled 4.3 trillion yuan and its debts amounted to 2.66 trillion yuan.

However, analysts said the ministry's debt levels will drop as the high-speed rail network takes shape.

"High-speed rail investment has a long payback period. The high debt-to-asset ratio will fall accordingly after the ministry's high-speed rail projects generate stable returns," according to Shen.

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