NAKHON RATCHASIMA, Aug 22 (Reuters) - Thailand’s cabinet on Tuesday approved a draft contract for a detailed plan on the design and construction of the first phase of the country’s high-speed railway project with China.

The 250-km (155 mile) high-speed rail line will link the Thai capital of Bangkok and the northeastern province of Nakhon Ratchasima and is scheduled to be operational by 2021.

It is part of China’s controversial Belt and Road initiative, which aims to build a modern-day “Silk Road” connecting the world’s second-largest economy by land corridors to Southeast Asia, Pakistan and Central Asia and maritime routes opening up trade with the Middle East and Europe.

“The State Railway of Thailand will use this contract to hire China’s experience state enterprise which will be responsible for the detailed engineering design of the project, which will include elevated tracks, tunnels, bridges, and stations,” Kobsak Pootrakool, vice minister at the Prime Minister’s Office, told reporters.

“The planning phase will take 10 months and have the financial ceiling of 1.7 billion baht,” Kobsak said.

The Thai government is planning to approve another contract that covers supervision expenses.

Prime Minister Prayut Chan-ocha plans to officially sign these two contracts with his Chinese counterpart when he visits China on Sept. 4-5.

The construction of the first phase of the $5.5-billion Thai-Chinese rail project was approved by the Thai government in July.

The project, which is seen by observers as a centerpiece of China-Thailand relations, has been hit by delays over details including construction funding and technical assistance.

China and Malaysia broke ground this month on a $13 billion rail project linking peninsular Malaysia’s east and west. (Reporting by Panu Wongcha-um; Editing by Nick Macfie)