Thai probe puts at risk ITD's contracts on China-backed rail project

Thai state railways is consulting the country's top law ‌officer about terminating contracts with Italian-Thai Development PCL, an official said, after its construction work on a China-backed high-speed rail project was marred by an accident. Public anger has grown after two accidents that killed 32 people at two ⁠ITD construction sites on consecutive days in January, as government and police step up scrutiny of a firm whose shares have lost 53% over the past year.

Thai state railways is consulting the country's top law ‌officer about terminating contracts with Italian-Thai Development PCL, an official said, after its construction work on a China-backed high-speed rail project was marred by an accident.

Public anger has grown after two accidents that killed 32 people at two ⁠ITD construction sites on consecutive days in January, as government and police step up scrutiny of a firm whose shares have lost 53% over the past year. The railway board, which is overseeing a 609-km (378-mile) high-speed railway linking Thailand to China through Laos, met on Thursday to consider the future of its contracts ​with ITD.

"The board assigned the State Railway of Thailand to consult with the Office of the Attorney General on all aspects of the contract ‍provisions," Anan Phonimdang, acting governor of the railway system, told Reuters. ITD did not respond to detailed questions from Reuters, sent by email.

Anan's comments came after Prime Minister Anutin Charnvirakul, who faces a general election early next month, said that his government will terminate ITD's contracts for the two projects and pursue legal action against it. But such a move requires careful legal examination, ⁠which the railways ‌have initiated by seeking a go-ahead ⁠from the attorney general.

Anan said the discussions included terminating contracts with ITD. The firm is building a rail depot and two sections of railroad, together stretching 68 km (42-miles). A January 14 train ‍derailment caused by a construction crane on a section in northeastern Thailand killed 30 people, while two more died the next day near Bangkok, the capital, when another crane ​collapsed at a highway project involving ITD.

Other incidents include one last year that killed 89 people when an ITD high-rise project collapsed ⁠during an earthquake, prompting charges of criminal negligence against 23, including the company's president. Last month, Thai credit rating agency TRIS projected ITD's revenues could drop as much as half in the next three ⁠years, compared to 2024.

In statements to Thailand's stock exchange ITD has said it accepts responsibility for providing care, compensation, and remedies for the losses incurred in both the most recent incidents. POLICE PROBE

Thailand's transport ministry has called a 15-day halt to construction on 14 of its contracts involving ITD, besides launching an investigation ⁠into the two accident-hit projects to assess wrongdoing. "Legal action can certainly be taken, but the extent of it depends on what wrongdoing is identified," Chirapong Theppithuck, ⁠deputy permanent secretary in the ministry, ‌told Reuters this week.

Complaints have been filed by relatives of the dead and injured in the derailment, said police official Thatchapol Chinwong in the district where the accident took place. "Police are gathering evidence to take legal action," ⁠he told Reuters, adding that 150 witnesses had been interviewed.

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