The multi-billion dollar high- speed rail system that Thailand will be building is primarily designed to speed up the movement of goods and passengers, promote domestic consumption and boost the country's economic growth, according to Pansak Winyarat, chief economic adviser to Prime Minister Yingluck Shinawatra.

In an interview with Xinhua, Pansak said that with a budget of about 730 billion US dollars, to be financed by loans, the rail system will be modernized and expanded throughout the country to link its major provinces with one another and with its neighboring countries.

Equipped with high-speed trains, the rail system will be able to deliver farm produce such as fresh foods and vegetables much faster than ever to varied destinations, either within the country or abroad, said Pansak, who also served as economic adviser to former premiers Chatichai Choonhavan and Thaksin Shinawatra.

Phase one of the hi-speed rail system, which is estimated to cost 25 billion US dollars, will link Bangkok to Chiang Mai in the north, Nakorn Ratchasima in the northeast, Pattaya in the east and Hua Hin in the upper south.

Pansak said that under the current rail system, it will take more than 12 hours to travel from Bangkok to Chiang Mai for a distance of 700 kilometers, But under the proposed hi-speech train system running from 250 to 300 kilometers per hour, it will only take less than four hours over the same distance.

"We've designed the high-speed rail system to deliver fresh fruits and vegetables aside from shuttling passengers,"Pansak said.

He said that the efficient transport of goods by the modern railway system would mean less cost for consumers.

"For that reason, people would buy more of the fast-delivered farm products while the farmers would undoubtedly make more earnings. That's how the national economy will grow."

"Apples from the United States currently sell at lower prices in Thailand than Thai mangoes. Why? It's simply because today's air freight for the imported apple costs much less than in previous years," Pansak said.

He also said that businesses will flourish in the areas where the trains pass with restaurants, convenience stores and hotels definitely sprouting in the vicinity of the railway stations.

"We'll follow the business model in Japan's Kyushu Island where up to 58 percent of its rail system's income is derived from trading and servicing at food shops, convenience stores and hotels near the railway stations. Though Kyushu does not have as many as 17 million commuters as in Tokyo per day, it has made as much as 330 billion yen in annual earnings," he said.

Pansak said that the Yingluck government plans to negotiate linking of the Thai rail system with those of China and Laos to make Thailand a regional logistics hub and expand connectivity between member states of the ASEAN Economic Community which is scheduled to come into being by 2015.