After three decades of rapid economic growth, both freight and passenger traffic
volumes increased significantly, and reached or exceeded the designed capacity of
the railway network. The relative importance of rail travel has declined over time.
Specifically, the percentage of passenger trips by railway in China declined from
77 % in 1950 to 6.1 % of all passenger trips in 2007. By contrast, the respective
percentage of trips by road and air passengers increased from 11.3 to 92.1 %, and
from 0.005 to 0.83 %, of all passenger trips. The railway administration is more
centralized and strictly controlled by the state than are other transportation modes.
Railroads have faced increasing pressure from market-oriented reforms and
decentralization. High-speed railway development and railway deregulation have
been proposed as possible remedies to improve its competitiveness. Given the
advantages in energy efficiency and environmental impact, railways should receive
favorable governmental attention over air and highway transportation (Wang et al.
2008).