From the global perspective, the rapid development of the high-speed rail in China is a rather uncommon phenomenon. Truly, it can be said that the high-speed rail somehow doubles as China's business card, but this business card is actually a pain point for the Chinese manufacturing industry. The global manufacturing industry, on the contrary, has benefitted greatly from the rapid development of China's high-speed rail, primarily because a considerable portion of funds managed to find their way into the global manufacturing industry, though it still remains a mystery how this actually happened.

Information obtained from a technical engineer who was part of the effort to import electric multiple units (EMU) into China reveals that while we are able to use the blueprint of foreign parties to produce bogies, motors, and transformers; while we are able to assemble converters and automatic control systems using core components obtained from foreign parties, we actually have no understanding about design basis and design principles, and not know about things such as whether or not increasing the width of the carriages will entail any risks. This is because we have not been able to obtain the calculations of the original design from these foreign parties, neither have we been able to acquire information on the parameters or upgrading methods of bogies, nor information on the multi-dimensional co-simulation technology used to calculate the electromagnetic, thermal, and force fields of motors and transformers, let alone information on the methods of designing structural reliability. Moreover, we also have no access to the databases on inspection standards and the fatigue characteristics of related material, and the source code of the automatic control system software still eludes us. These might seem like the most basic things, but they are also the most crucial, and we have not been able to get a hold on any of them by importing the EMUs.

China actually already has the capacity for large-scale EMU production, as within the span of a few short years, there has been an output of hundreds of EMUs. However, these EMUs, which are purportedly manufactured and produced by Chinese enterprises, are actually only assembled in China—their key components are still being imported from abroad. This is an all too familiar situation, for we have encountered it before with the automotive industry. The only difference is that the strategy of "swapping the market for technology" implemented by the automotive industry is widely considered to be a failed experiment. This, in fact, was the secret of the so-called "Great Leap Forward" of China's high-speed rail technology during Liu Zhijun's era. At that time, imports from Siemens made up almost half of the original imported components, but simply because assembly of these components was done in China, the production was taken into account in the rate of localization of the industry. This means that the figures of the rate of localization are actually unreliable.

According to one of Siemen's technical personnel, the technology of the train consists of three main systems: the traction control system, bogies, and the brake systems, the most crucial among which is the traction control system, the so-called "heart of the train." While the foreign suppliers do not have plans to reduce the prices of these technologies, they are also not planning to transfer them over to Chinese parties. Of all the components required for the traction control system, only a fraction is relatively less tech intensive and have more local manufacturers which were introduced during the localization process. In fact, the prices of CRH2's traction motors fell by 12.5% during the second phase of industry localization.

On the other hand, the software system is the most crucial and tech-intensive component in the entire traction control system. Accordingly, many industry experts reveal that Siemens, Kawasaki, Alstom all have not transferred this technology to Chinese parties. "We can only set up the parameters of each component to have real design capabilities if we have a mastery of the control system. However, this technology is the fruit of [these foreign suppliers'] long and hard labour over the years and it is thus improbable that they will hand it over to someone else." Adding to this, a technician from northern China said that the so-called domestically and independently developed CRH380B series is actually still dependent on Siemens, especially in the event that operational problems arise.

"On one hand, the upgrading of software must be done by Siemens, and on the other hand, experimental data needs to be sent back to the Siemens headquarters as well. All of this significantly prolongs the modification period."
So what proportion of the entire cost of the EMU does a core technology like the traction control system actually make up? As much as 20-30%. Subsequently, the automatic train control system, which is the most profitable, makes up about more than half of the total cost. A staff of Siemens' purchasing department even admitted that "Siemens is now relying primarily on sales of the traction control system," and the same is true for Alstom. Likewise, the technology of the brake system has also not been transferred as foreign suppliers consider it to be a fundamental source of their income. Instead, this system is produced by foreign parties in joint venture factories within China. "Even so, there is no transfer of technology happening in these joint venture plants as Chinese personnel might not even be allowed to look at the blueprints." It is thus evident that not only is the market for the high-speed rail brake system being monopolized by Knorr-Bremse but there is also no transfer of this central technology.

Among the three major systems, there has only been a contract of transfer of technology for the manufacturing of bogies, and even then, it is only limited to the sale of the blueprints. This means that Chinese parties still do not have a proper understanding of the design principles. Another person who was involved in importing the EMUs revealed that CRRC once asked Siemens about how bogie parameters were set, but in response, Siemens only equivocated. Currently, the components of the bogie are welded by the CRRC while the rest of the components are imported from abroad. This led an engineer from the south to say that, "purchasing EMUs from several foreign companies is like buying fish; we will be able to feel ourselves but ultimately we do not have the rod with which we can fish for ourselves. At this point, the key components of the automatic control system still need to be imported, and similarly, the source code of the automatic control software has yet to be transferred to us."

In introducing high-speed rail technology, China created a huge market. However, the ones making the real profits at the top of the pyramid are still foreign companies, and they continue to hold on to their position of leadership by maintaining control over the core technologies and key components. Although it can be said that the high-speed rail created a miracle, it is actually a pain point for the Chinese manufacturing industry. Just like the "superjet," China's manufacturing industry still has a long way to go before it can be considered "advanced," and this endeavour will be no less challenging than it was for the automotive industry.

After all these years, it is evident that China's manufacturing industry is still stuck in a predicament: on one hand, there is overproduction in low-end manufacturing, and on the other hand, the auction market has reached a point where it is basically fighting with itself and scrambling to capture the market with lower and lower prices. In the meantime, many sectors in high-end manufacturing are also stagnating and unable to move forward while their resources have been benefitting external parties. All in all, China has had to bear the brunt of globalisation not only in the face of widespread public criticism but also without reaping much benefit in return. Amidst all of this chaos, the working people of world have been deprived of many job opportunities, and it is apropos for China to reflect and retrospect on the number of "grievances" that it has caused.