It will be divided into three projects.
The 319-kilometer section between Hanoi and Vinh will see the renovation of weak bridges and reinforcement of downgraded sections at a cost of VND854 billion.
Over VND1.19 trillion would be spent on similar upgrades to the 996-kilometer section between Vinh and Nha Trang and VND1.09 trillion on the 411-kilometer route from Nha Trang to HCMC.
The work is scheduled for completion by 2025 and will be overseen by the Railway Project Management Board.
The rail network has not received major upgrades in decades, and has lost out to road and air transport, preferred for their speed and convenience.
By 2050, the country plans to have 25 rail routes covering 6,354 km from the current seven and 2,440 km.