The agreement was signed at the Asia Pacific Economic Cooperation (Apec) summit in Beijing by the Chinese premier Mr Li Keqiang and Thailand's prime minister General Prayut Chan-o-cha. Thailand will repay the loan by supplying rubber and rice to China.
One standard-gauge line will run from Nong Khai on the border with Laos south via Kaeng Khoi where it will split to serve Bangkok and Map Ta Phut in Rayong. There will also be a direct standard-gauge line from Bangkok to Map Ta Phut.
The lines will be operated initially by what the Thais describe as "mid-speed" trains unless feasibility studies confirm that 250km/h operation will be viable.
"We have agreed to build the dual-track rail routes using 1435mm-gauge to improve transport connectivity," Prayut said. "If we don't start construction now, it will prove an obstacle to transport in the future. We have to make a decisive move, otherwise transport development will be delayed and the cost of the project will increase."