Merging the functions of the now-defunct Ministry of Railways into the Ministry of Transport will allow the government to concentrate on setting policy and supervision, a spokesman said on Thursday.

He Jianzhong, spokesman for the transport ministry, told a news briefing, the first since the merger, that the overhaul is aimed at providing a better service to the public.

According to the overhaul plan released on March 10, the State will set up a bureau to set technical standards for the railway industry, and supervise the safety and quality of the railway service and projects.

China Railway Corp, a State-owned company set up on March 14, will operate railway construction and transport business.

Zhao Jian, professor at the school of economics and management at Beijing Jiaotong University, believes the overhaul will help the railway industry improve and climb out 2.66 trillion yuan ($428 billion) of debt.

“When the government took charge of constructing and operating railways, it weighed political performance records over economic benefit,” said Zhao, suggesting that the construction of “too many” high-speed railways helped the debt to mount.

Spokesman He said that “streamlining” the government’s power means transferring it to market, and stimulating enthusiasm among enterprises and entrepreneurs.

But Zhao said there are real challenges for the expanded transport ministry, one being that the railway sector will continue to have problems attracting private investment, because railways as infrastructure are “l(fā)osing money every year”.

Another challenge is that the Ministry of Transport, which now oversees civil aviation, waterways, railways and highways, will have to juggle policymaking in all these areas into an effective and productive transport network nationwide, he said.