In December 2011, the Ministry of Railway (MOR) released a 2012 railway fixed-asset investment target of 500 billion yuan ($79.27 billion), below Detsche Bank (DB) analyst's estimate of 630 billion yuan and much lower than market expectations of between 650 and 670 billion yuan.
Ma Jun, chief economist of the bank, said that he believed the railway investment target may be revised up in a few months.
"However, we believe that the current MOR budget is based on a conservative expectation of the national government budget, which will not be finalized until the National People's Congress in March," said Ma.
Given that real economic indicators will likely worsen in the coming months, DB believes the government will get a bit more aggressive in budgeting its fiscal expansion two months from now.
"We will not be surprised if the fixed asset investment target of the MOR is revised up again to 600 billion yuan for 2012," Ma said.