A government plan to introduce competition to train operations and end the monopoly held by state-run KORAIL is stirring a heated debate as critics say for-profit businesses would endanger safety and public interests.

The Transport Ministry said last week it will open bidding this year to operate new bullet-train routes connecting Suseo in southern Seoul to the southern part of the country, which will open in 2015. KORAIL will continue to manage the other sections.

The ministry expects the change will help lower ticket prices by 20 percent and boost the efficiency and competitiveness of the flaw-ridden Korea Train Express, or KTX.

Major corporations including Doosan, Dongbu and Gumho Asiana have already expressed their interest, ministry officials said. The permit is expected to last up to 15 years.

Skeptics, however, say it is only the latest in a string of pro-business policies of the Lee Myung-bak administration, including privatizing airports and allowing for for-profit hospitals.

The new policy would undermine the trains’ public purpose and private businesses will be tempted to raise fares, KORAIL’s labor union and opposition lawmakers charge.

“The plan will inevitably result in privatizing the system, thus incurring poor maintenance and jeopardizing passenger safety as private owners would seek moneymaking quickly,” opposition legislators Kim Jin-ai and Kang Ki-kab said in a joint statement.

It costs around 110,000 won ($95.4) for a round-trip KTX ticket from Seoul to Busan, 450 kilometers to the southeast. The new route is forecast to draw high demand given there is only one station in the capital’s downtown.

“It’s not at all about privatization. If it were, we would’ve put up KORAIL itself for auction,” Kim Han-young, the ministry’s head of transportation policy, told reporters.

“Our intention is to run the system more efficiently by breaking up the monopoly, and help KORAIL clear off debt by hiring a private contractor who can pay higher fees for a profitable line.”

KORAIL runs a deficit of 15 trillion won. It spends about a third of KTX’s revenue, or 100 billion won, every year on interest payments totaling 400 billion won.

The high-speed train services suffered a series of technical and maintenance flaws last year.

Nevertheless, the number of KTX passengers increased 20 percent last year, topping 50 million for the first time since its 2004 launch, KORAIL reported.

Having multiple operators is a must if Korea wants to end the chain of accidents and breakdowns and upgrade its super-speed train service, said Kim Chan-oh, a professor at Seoul National University of Science and Technology’s railroad department.

“Korea has secured world-class technologies for train-making but the state monopoly lacks the capacity to manage and oversee the hardware properly, which accordingly erodes customer services and the overall industrial competitiveness,” Kim told The Korea Herald.

While trains are becoming faster and lighter with revolutionary changes in technology, KORAIL and other related agencies remain inept, oversized bureaucracies failing to keep up with the trend, according to the professor.

The planned open bidding will provide chances for reassessing current management problems and bring about some cost-cutting effects though it is too early to calculate exactly, he added.

“When Seoul first launched subway lines, there was only one operator -- the city government. But now we have one of the world’s best metro systems efficiently run by four firms, two of which are private.”

By Shin Hyon-hee (heeshin@heraldcorp.com)