China's landmark project on "the roof of the world" -- the Qinghai-Tibet Railway -- will have a long-term impact on the local logistics industry, a domestic expert said.

Wei Houkai, a senior expert with the Chinese Academy of Social Sciences (CASS), said here recently that the operation of the Qinghai-Tibet Railway two years from now will help boost goods exchanges between the secluded Qinghai-Tibet Plateau and elsewhere in China.

Tibet, with an area of more than 1.2 million sq km, approximately one eighth of China's territory, was the only provincial area in China without an inch of operating rail line, and backward traffic conditions have been one of the major obstacles to its economic development.

Wei said prices in Tibet are much higher than interior areas due to the high transport cost. Each ton of coal or cement sold in Lhasa costs more than 700 yuan (84.5 US dollars).

Prices will come down once the Qinghai-Tibet railway is operational, which will also further stimulate the trade between Tibet and the other provinces, he said.

Wei predicts that the trade volume between Tibet and the inland provinces will reach 2.8 million tons by 2010, and that about 2.1 million tons of goods will be transported by rail.

Roads are currently the major way to transport goods in Tibet, but Wei said the proportion of road transport will go down with the operation of the Qinghai-Tibet railway and a total of 75 percent trans-province goods will eventually be undertaken by rail.

In addition, more products from the interior provinces will enter Tibet through the new railway route, acknowledged Wei, and that minerals, Tibetan medicines, yak, highland barley and some other local products from Tibet will become increasingly popular in the interior provinces.

The 1,142-km Qinghai-Tibet Railway from Golmud in northwestern Qinghai Province to Lhasa is the most elevated rail route in the world, reaching an altitude of up to 5,070 meters.

China began building the Qinghai-Tibet railway in 2001. The railway, the cost of which is expected to be 26.2 billion yuan (3.16 billion US dollars), is scheduled to go into service in 2007.