China's Ministry of Railways (MOR) signed a deal with state-owned vehicle producer CNR Corporation Limited (CNR) in Beijing on Monday to purchase 100 high-speed CRH trains for 39.2 billion yuan ($5.74 billion).

CRH, an abbreviation for China Railway High-speed, refers to trains with speeds above 200 km per hour. With a designed speed of 350km/h, the new CRH trains will travel between Beijing and Shanghai in 2011, when the construction of the 1318-km, high-speed railway between the capital city and the country's financial hub is expected to complete.

"The contract does not include any foreign parties, as Chinese companies possess core technologies for the high-speed trains and have complete intellectual rights over the 350km/h CRH type," said Zhang Shuguang, director of the transport department under the MOR.

The MOR had introduced railway technologies from Japan, France, Germany and Canada in the development and production of the 200km/h CRH trains already in operation at present.

According to the agreement between the ministry and CNR, all 100 trains will be self-developed and manufactured under the CNR group. Tangshan Railway Vehicle Co and Changchun Railway Vehicle Co, two CNR subsidiaries, will be in charge of the production of 60 sets and 40 sets, respectively.

Zhang said China would see "large purchases" of CRH trains in the coming years upon the completion of more passenger railway lines across the country.

The MOR has planned to spend 500 billion yuan to buy trains over the next four years.

"The purchases will provide strong support for related industries," Zhang said.

The manufacturing of a CRH train requires nearly 100,000 parts from a wide range of industries such as mechanics, metallurgy, electrics, chemical, and materials.

"We will buy more CRH trains this year as a move to help stimulate domestic demand," said Zhang without giving further details on the purchasing plan.