Thirty-nine people died when one train ran into the back of another, which had stalled on a viaduct near Wenzhou after lightning cut its power supply.

The system "failed to turn the green light into red", said An Lusheng, head of the Shanghai Railway Bureau.

Chinese Premier Wen Jiabao, who has been visiting the crash site, vowed to "severely punish" those responsible.

"The country's development is for the people, so the most important thing is people's lives," Mr Wen told reporters at the scene.

Mr Wen earlier promised to take steps to improve safety on the high-speed rail network - one of the government's flagship projects which it hopes highlights China's development.

Six carriages derailed and four fell between 20m to 30m (65ft to 100ft) from the viaduct after Saturday night's crash, injuring nearly 200 people.

The accident came just four years after the country's first high-speed trains began operating. Rail experts had warned against the rush to build the world's longest and fastest high speed rail network in record time amid safety concerns.

Comparisons have been drawn with Japan's bullet train system, which has had no major accidents since it started running in 1964.