China began work on Sunday to build an extension to the world's highest rail link, the Qinghai-Tibet Railway, linking Xigaze, the second largest city in the southwestern Tibet Autonomous Region. The 253-km line from Tibet's capital Lhasa to Xigaze will pass through five counties as well as over the 90-km long Yarlung Zangbo Grand Canyon. The work will take about four years. This is the first extension of the Qinghai-Tibet Railway that opened in July 2006. The Lhasa-Xigaze railway, with a budget of 13.3 billion yuan (1.95 billion U.S. dollars), is capable of transporting 8.3 million tonnes of cargo per year. The local authorities did not provide a projected annual passenger number. Zhang Qingli, Communist Party chief of Tibet, said the rail line would make train services available in southwestern Tibetan regions which currently rely solely on roads for transport. The railway will detour around nature reserves and drinking water sources and more measures will be taken during construction to better protect the fragile plateau environment, Zhang said. Minister of Railways Liu Zhijun said the extension is a key project in China's long and medium-term railway network expansion and will speed up Tibet's social and economic development. It will also play a vital role in boosting tourism and promoting the rational use of resources along the line, he said. Further, Tibet is planning to build another railway to link Lhasa with Nyingchi to boost tourism and the economy in Tibet. During its four-year operation, the Qinghai-Tibet Railway has reduced transportation costs and greatly boosted economic growth in Tibet, especially through developing tourism and other local special resources, Liu said. Xigaze, with a history of more than 600 years, is Tibet's second largest city and the traditional seat of the Panchen Lamas. Xigaze City is the administrative center of the Tibetan prefecture of the same name, a 182,000 square km area that borders India, Nepal and Bhutan. It is also famous for Qomolangma (known as Mount Everest in the West), which rises up from within it. 