A Chinese group was chosen by the Mexican government to build the first bullet train in Latin America, The Australian reported.
Mexico's transport ministry has accepted the $3.75 billion proposal by China Railway Construction Corporation. The Chinese-led consortium, which has some Mexican firms among its members, was the only group to submit a proposal by the deadline set on Oct. 15.
The railway project, 210 kilometers long, will stretch from Mexico, the capital, to the central Mexico manufacturing center of Queretaro.
With the exception of a few tourist lines, the railway system became a thing of the past in Mexico more than a decade ago. The new railway project is part of President Enrique Pena Nieto's efforts to pave the way for the return of passenger trains.
"In a country with 120 million inhabitants, where the main urban centers are large metropolises, passenger transport must be of massive scale," said transport minister Gerardo Ruiz Esparza during a press conference.
The railway is projected to carry 23,000 passengers a day at speeds reaching 300 kilometers per hour. This will decrease travel time between Mexico City and Queretaro to 58 minutes from two and a half hours, according to officials.
The consortium said that a value-added tax of $US4.3 billion will be added to the cost.
In an earlier stage, 16 other companies were being considered for the project, but the consortia ultimately decided not to make a proposal, according to the ministry. Among these were Japan's Mitsubishi, France's Alstom, Canada's Bombardier and Germany's Siemens.
Construction of the railway is expected to begin in December, while operations are seen to start in 2017.