Mexico launches historic train line connecting Gulf Coast to Pacific Ocean

Mexico's "Inter-Oceanic Train" will carry both passengers and cargo on 3-hour trip from coastal hub in Veracruz state to the Pacific port of Salina Cruz

Mexico on Friday launched operations on a train line that crosses the country's narrowest point from the Gulf coast to the Pacific Ocean, kicking off a flagship government project as the administration enters its last months in office.

The Inter-Oceanic Train, that crosses the country's narrowest point from the Gulf coast to the Pacific Ocean, in Salina Cruz, Oaxaca, Mexico, is seen in this handout (via REUTERS)

The "Inter-Oceanic Train," which will carry both passengers and cargo on a three-hour trip from the coastal hub of Coatzacoalcos in Veracruz state to the Pacific port of Salina Cruz, is part of President Andres Manuel Lopez Obrador's plan to bring investment to the country's poorer south.

The government is also hoping to attract investments from carmakers, tech firms and semiconductor producers in a dozen industrial parks in the area. The two port towns are also home to major installations of state-run oil company Pemex.

Officials have pitched the train line as a potential rival to the Panama Canal, which curbed operations this year due to a historic drought.

"All the Asian countries are very interested," Lopez Obrador said on Friday, "because Panama is at capacity."

Analysts, however, estimate the rail line will be able to ship just a fraction of what the canal moves.

Other lines connecting to the train's main rail line are expected to be completed next year, officials said on Friday.

One of the branches will connect to the Mayan Train, another flagship project inaugurated last week, which will carry travelers from the southern state of Chiapas to the tourist town of Cancun once all sections are completed.

Experts, however, have warned that the Mayan Train has run nearly four times over budget and is still far from being finished.

Earlier this year, Mexican authorities seized parts of a rail line operated by conglomerate Grupo Mexico's transport division for the Inter-Oceanic Train, with the two parties later coming to a deal.

Lopez Obrador has also said he wants to get major rail operator CPKC, which operates a network through Canada and the U.S. and ends in Veracruz, on board with his rail projects to connect their lines to the government's projects in the South.