The state council decided to use conventional wheeled trains on the lucrative new high-speed route - dashing the hopes of German engineers bidding to have their "maglev" system chosen.

Maglev technology minimises friction by floating trains on an electromagnetic cushion that allows them to be propelled along guiderails at great speed. Two weeks ago, Shanghai began the world's first commercial maglev service, between the city centre and Pudong airport, on which trains have a top speed of 267mph.

That 18-mile line was constructed to demonstrate the maglev's prowess, but delays and its $1.2bn (£665m) cost appear to have spoiled China's appetite for the technology. Wen Jiabao, the prime minister, is said to have been involved in the decision to abandon maglev. "This is indeed the end of decade-long feasibility studies," said the state-owned newspaper China Daily.

The race to build a new generation of high-speed Chinese railways now appears to have only two foreign contenders: Japan's Shinkansen and France's TGV.