Last year, the company invested over 10.6 billion yuan (US$1.3 billion) in China and posted a turnover of 44.3 billion yuan (US$5.5 billion).

Other foreign companies are also aggressively expanding their businesses in China.

Bombardier, a global manufacturing leader in transportation solutions, has signed an agreement with the railway ministry to set up a high-speed train maintenance centre.

It has also supplied a number of high-speed passenger cars. Its latest milestone is the delivery of the 1,000th metro car to the southern city of Guangzhou.

"Bombardier continues to play an important role in that objective (developing China's rail infrastructure) by investing for the long-term in China, bringing technological expertise here and building effective partnerships with in-country enterprises," says Stephane Rambaud-Measson, president of Bombardier Transportation's global mainline and metros division.

Areva's transmission and distribution (T&D) arm has announced plans to spend 50 million euros (US$63 million) in the next three years to double its manufacturing capacity in China.

The French company will expand its presence by supplying products and technology, Philippe Guillemot, CEO of Areva T&D, told China Business Weekly in an interview earlier last month.

As for private investors in the country, analysts say there will be more room for them to cash in on the construction and operation business once the government comes up with more favourable financial and taxation policies.

Expanding the rail network entails huge spending, but this will not be sustainable if funding only comes from the government, says NDRC's Wu.

China's first railway to be built with private participation will link Quanzhou and Changshan, two cities in East China's Fujian Province.

Changshan Cement Co Ltd, a  local private company, will hold 32.5 per cent of the shares, with the remaining split between the railway ministry and the local government.

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