High-speed trains linking Beijing and Shanghai made their passenger debut Thursday on a $33 billion track China hopes will help ease its overloaded transport system.

Premier Wen Jiabao declared the link "in operation" at Beijing South rail station before boarding the first sleek-nosed white train that took passengers to Shanghai, the country's commercial hub, in less than five hours.

He said the high-speed line -- launched on the eve of celebrations to mark the 90th birthday of China's Communist party -- would be key to "improving the modern transport system... and satisfying people's travelling needs".

The line, which has been operating on a trial basis since mid-May, halves the rail journey time between the country's two main cities and could hurt airlines on the busy route plagued by delays and cancellations.

"The high-speed train is fast and more convenient than a plane," 38-year-old Xu Yuhua told AFP as she waited with her 10-year-old daughter to board the first departure for Shanghai, which left promptly at 3:00 pm (0700 GMT).

Armed police and regular officers were on high alert at the station, where 10 of the gleaming trains were lined up for departure. Excited passengers posed for photographs in front of the locomotive and outside their carriages.

The fast link, which has been hit by safety concerns and graft, is opening a year ahead of schedule and will be able to carry 80 million passengers a year -- double the current capacity on the 1,318-kilometre (820-mile) route.

"It could play a transformational role in shaping the future economic dynamics in coastal China... by creating more spillover effects to regions lying along the sprawling high-speed railway line," Ren Xianfang, an analyst at IHS Global Insight, told AFP.

But for the airline industry, the impact could be "destructive", she warned.

One-way train ticket prices will cost 410-1,750 yuan ($63-$270) subject to further adjustments, vice rail minister Hu Yadong said this month, compared with about 1,300 yuan for a flight.

In response, airlines have slashed some prices by up to 65 percent to below the cost of the cheapest high-speed rail ticket, state media said Wednesday, citing travel website ctrip.com.

On board, waitresses wearing blue tunics and yellow smiley face badges walked up and down the aisle selling beer, soft drinks and juice -- but the beverages ran out two hours before arrival.

Supplies of instant noodles and pre-packaged meals were stacked high in the cafe car.

A 36-year-old male passenger surnamed Zhang, who was travelling back to Shanghai with colleagues, said he appreciated the extra legroom, noting: "Planes are not as comfortable."

Frederic Campagnac, general manager of transport and logistics consultancy Clevy China, nevertheless believes the fast link will have a positive impact on airlines by forcing operators to be on time.

It will "put pressure on the airlines to keep more on their schedule," Campagnac said.

Work on the high-speed railway started in April 2008 with a planned investment of 220.9 billion yuan.

China is spending heavily on its high-speed rail network, which spanned 8,358 kilometres at the end of 2010 and is expected to exceed 13,000 kilometres by 2012 and 16,000 kilometres by 2020.

But huge investment has also made the sector a hotbed for corruption, raising concerns over costs and safety.

China's state auditor in March said construction companies and individuals last year siphoned off 187 million yuan in funds meant for the Beijing-Shanghai link.

The revelation followed the sacking of former railways minister Liu Zhijun in February, who allegedly took more than 800 million yuan in kickbacks over several years on contracts linked to China's high-speed network.

The railway ministry has said the trains would run between 250 and 300 kilometres per hour on the new link, which is designed for a maximum speed of 380 kph.

The speed is in line with a nationwide directive made public in April that said all high-speed trains must run slower than previously announced -- no faster than 300 kph -- for safety.

"I'm not afraid," a 30-year-old woman from Shanghai surnamed Wen told AFP, as the train accelerated to top speed, whizzing past factories, high-rise apartment buildings, and vast farmlands where peasants worked in the fields.

"The ticket is a little bit expensive but I think the train is more stable than a plane."

Urban areas within 300 to 400 kilometres of Beijing and Shanghai "will become kind of suburbs to the big cities" because it will be possible to do a return trip in one day, Campagnac said.

"All the cities on the way will benefit from the line," he added.

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