Iran’s rail freight transportation grew by 29% in the last fiscal year (ended March 20, 2021) compared with the year before, despite border closures during the first four months of the Covid-19 pandemic.
The statement was made by Saeed Rasouli, managing director of the Islamic Republic of Iran Railways, in a virtual meeting of the 36th Conference of the Organization for Cooperation of Railroads (April 19-23) on Friday.
“Exports by the Islamic Republic of Iran Railway increased by 5% in the last fiscal year [March 2020-21] compared with the year before. More than 650,000 tons of cargo were carried across Iran-Turkey rail border [Razi border terminal, Iran’s sole rail connection with the neighboring country], reaching a record high in the past 10 years,” IRNA quoted him as saying.
The Organization for Cooperation of Railways, also known as OSJD, was established as the equivalent of the International Union of Railways to improve international rail transport coordination.
Mainly concerning transportation between Europe and Asia, it has helped develop cooperation between railroad companies and other international organizations. Members of this organization created an international transportation law.
Rail transport of goods during Norouz (Iranian New Year) holidays from March 15 to April 2 stood at 2.96 million tons or 1.96 billion tons/kilometer, registering a year-on-year rise of 21.6% and 4.2% respectively, according to Minister of Roads and Urban Development Mohammad Eslami.
All health protocols to prevent the spread of Covid-19 were observed by cargo trucks and trains during the period under review.
Iran, Turkey Aim for 1m Tons of Rail Freight in 2021
Roughly 1 million tons of cargo are to be transported via railroad between Turkey and Iran this year, Turkish authorities say.
The Transport and Infrastructure Ministry of Turkey has said in a statement that a recent memorandum of understanding signed in a gathering of rail representatives in Turkey's capital Ankara on Jan. 12-13 would open a new era for rail transit, Anadolu Agency reported.
Despite the novel coronavirus pandemic, three train services were run daily between Turkey and Iran in 2020, transporting 564,000 tons of cargo, according to the statement.
The statement also announced that freight trains would also run between Turkey and Pakistan via Iran on a common tariff between the three countries. It added that talks are still ongoing to set this tariff.
With a recently completed railroad between Iran and Afghanistan, it will now also be possible to transport freight between Turkey and Afghanistan.
After the rail connection between Iran and Afghanistan was completed on Dec. 10, 2020, it became possible for a wagon loaded in Turkey to transit Iran to Afghanistan.
The statement added that efforts were underway for a cargo transportation corridor through Iran between Europe and China.
Iran and Turkey traded 11.17 million tons of commodities worth $6.85 billion in the last Iranian year (March 2020-21), registering a 51.52% and 31.82% decline in weight and value respectively compared with the year before, according to the spokesperson of the Islamic Republic of Iran Customs Administration.
“Iran exported 6.36 million tons of goods worth over $2.51 billion to the neighboring country over the period under review, indicating a 63% and 50% decline in volume and value YOY,” Rouhollah Latifi was also quoted as saying by IRNA.
The main exported products were natural gas, nuts, dairy, milk powder, fruit and vegetable, vinegar, tobacco, salt, minerals, herbal extraction, polymers, construction materials, doors and windows, apparel, bags and footwear, carpet and fabric, tiles and ceramics, stone, toiletries, dishes, pipes, home appliances, agricultural and industrial machinery, electronic devices and steel sheets and ingots.
Latifi noted that Iran imported 4.81 million tons of products worth $4.34 billion from Turkey during the same period, registering a 15.5% and 13.5% decrease in weight and value respectively YOY.
Imports included pulses, barley, banana, rice, seeds, edible oils, cocoa, fruit essence, industrial oils, raw materials and machinery, paraffin, industrial acids and oxides, pharmaceuticals, vaccines, medical and dentistry equipment, fertilizer, fabric, auto spare parts, printing ink, paper and cardboard, paint, minerals, wood sheets, galvanized sheets, bolts and nuts, agricultural equipment, elevators, cranes and packaging equipment.
According to the official, each ton of exports to Turkey during the period was valued at $394.9 on average up 36.22% from $289.9 of the year before as each ton of imports was valued at an average of $901.8, up 2.31% from the $881.4 of the year before.
Boost in Rail Exchanges With Turkmenistan
Noting that freight transport via Sarakhs rail border [with Turkmenistan] in Khorasan Razavi Province grew by 173%, the official said, “The broad gauge line in Inche Broun Station located in Iran’s northeastern Golestan Province was also connected to border station of the neighboring Turkmenistan to facilitate bogie exchange process and increase the wagon capacity.”
A total of 220,000 tons of goods were transported through Golestan Province’s Incheh Borun railroad to Turkmenistan during the first 11 months of last Iranian year (March 20, 2020-Feb. 18). The figure broke an all-time record, according to the director general of Northeast Railways.
“Cement accounted for 100,000 tons of the total exported products. Other main exports were iron products, tiles, dates, detergents and apples,” Mohsen Etemad was also quoted as saying by IRNA.
Total exports in the fiscal 2019-20 through Incheh Boroun railroad stood at 144,000 tons.
After the outbreak of Covid-19 in Iran, exports via Incheh Borun railroad to neighboring Turkmenistan were suspended in February for 100 days.
Some 1,400 kilometers of Iran’s 10,000 km of railroads are located in Khorasan Razavi Province in Iran’s northeast.
Minister of Roads and Urban Development Mohammad Eslami of Iran and his Turkmen counterpart Gandymov Rahim Nurgeldiyevich jointly inaugurated Sarakhs Transit Bridge in 2020.
The construction of this 96-meter-length, 15-meter-width transit bridge which connects Turkmenistan’s Sarakhs to Iran’s Sarakhs on the Tajan River started in the year ending March 2016 as per an agreement signed in Tehran on November 22, 2015, in a ceremony attended by President Hassan Rouhani and Turkmen President Gurbanguly Berdimuhamedow.
According to Eslami, the new structure facilitates the movement of 1,000 vehicles per day.
“The two-way bridge would play a key role in improving trade between Tehran and Ashgabat while it would also pave the way for the implementation of Ashgabat Agreement and help Iran expand its economic ties with countries in the Central Asia region,” he was quoted as saying by Fars News Agency.
Iran and Turkmenistan are members of Ashgabat Agreement—a multimodal transport agreement signed in 2011, which envisages the facilitation of transit and transportation of goods between Central Asia and Persian Gulf.
Latest data show Iran’s commercial exchanges with Turkmenistan stood at 753,985 tons worth $409.78 million in the fiscal 2018-19 to register a 17.58% and 5.04% decline in tonnage and value respectively compared with the year before.
Iran exported 735,880 tons of goods worth $400.48 million to Turkmenistan, down 16.56% and 4.3% in tonnage and value respectively year-on-year.
Iran’s exports to Turkmenistan mainly included potato, sugar, steel structures, apple, pipe and profiles, livestock and poultry feed.
The country imported 18,105 tons of commodities worth $9.29 billion from Turkmenistan, down by 45.09% and 28.77% in tonnage and value respectively YOY, most of which constituted oilcake, cotton linter, mineral oil, textile, sesame and beans.
Rail routes linking Iran, Turkmenistan and Uzbekistan opened for trade as of June 1 last year, after they were closed due to the outbreak of the novel coronavirus.
Khaf-Herat Project
Iran connected its eastern rail network to Afghanistan (Khaf-Herat railroad project) in December and negotiations were carried out with Kyrgyzstan, Uzbekistan, Russia and officials of other regional railroads, which would hopefully result in positive changes and improvements in international rail transportation.
Rasouli said Iran is trying to secure permits to operate freight trains across the Commonwealth of Independent States.
The railroad connecting Iran and Afghanistan was inaugurated by Iranian President Hassan Rouhani and his Afghan counterpart Ashraf Ghani via videoconference.
“Today marks an unforgettable day in [the two nations’] history,” Rouhani said following the opening ceremony.
The Afghan president, for his part, hailed the joint railroad as a “vital” and “historic” project.
“This project is a result of tireless efforts by both countries despite all restrictions,” he was quoted as saying by Afghan business news portal Wadsam.
In his speech, Ghani said he had hoped to attend the inauguration in person, but could not due to Covid-19 restrictions.
Ghani said, however, that the rail line was a critically important project, not only for Afghanistan and Iran but also for the region and beyond.
“The opening of Khwaf-Herat railroad is a great step for the development and economic leap of Iran and Afghanistan,” Ghani was quoted as saying by Ariana News.
He said rail transport is the most efficient, important and cheapest means of transporting goods in Asia.
Rouhani said that through this rail link, Afghanistan will be connected to European countries.
“With the Herat-Khaf rail line, Afghanistan will be connected to European countries and also to Chabahar railroad,” he added.
Atta Nasib, the head of Afghanistan Investment Facilitation Unit, said that this will help turn Afghanistan into a transit hub.
“This railroad between Afghanistan and Iran is a major economic and strategic achievement for both countries, which will connect us to European countries,” he said.
The Afghan president called the railroad a "precious gift from Iran" that would help restore the Silk Road, an ancient trade route that spread prosperity across Asia. The inauguration saw cargo trains depart from opposite ends of the line, AP reported.
According to Eslami, the 225-km-long railroad has been designed in four sections, three of which were previously inaugurated on Dec. 10.
“Sections one and two are 78-kilometer-long from Khaf County to Shamtigh border crossing in northeastern Khorasan Razavi Province in the Iranian territory and section three is 62 kilometers from the common border to Rozanak in Afghanistan. These three sections have been funded by Iran and constructed using Iranian expertise,” the minister said.
Shamtigh border checkpoint was named an official border crossing between the two countries for the transportation of commodities and passengers, during the Cabinet meeting on October 12.
First Vice President Es’haq Jahangiri communicated the enactment to the ministries of roads and interior affairs the same day.
Eslami noted that the 85-kilometer-long Section-4, which has yet to be constructed, will continue to Herat, the neighboring country’s third largest city, and Afghanistan has committed to construct it.
“The rail route between Iran and Afghanistan has been laid with the aim of increasing transit. Unified tariffs will be set in this and other transit points in the country,” Eslami was quoted as saying by ILNA.
“Preliminary negotiations have been made for Iranian experts to shoulder the construction of section four in the Afghan territory in exchange for Afghanistan’s mineral products. Moreover, negotiations have been ongoing to continue the rail route to Mazar-i-Sharif, which will then be linked to Uzbekistan, Tajikistan, Kyrgyzstan and China, completing a corridor connecting Iran to Central and East Asia.”
The Khaf-Herat project, said the minister, is part of Iran-Afghanistan rail corridor and can play a significant role in increasing Iran’s transit share in the region, from Russia to India and vice versa, in particular.
“The construction of the project began in the fiscal 2007-8 but was delayed due to security reasons in the region. Over the years, some 4 trillion rials [$15 million] worth of investments have gone into the project now worth a total of 15 trillion rials [$57 million],” Deputy Minister of Roads and Urban Development Kheirollah Khademi was quoted as saying by Iran Chamber of Commerce, Industries, Mines and Agriculture.
He told Iribnews.ir that the railroad will help boost Afghanistan’s development, expand the rail network between the Economic Cooperation Organization member states, increase transit from Central Asia to India and restore Iran’s pivotal role as the link connecting the East and West.
When completed, he said, the railroad will be Afghanistan’s first link to Iran, connecting the country to all of Iran’s southern ports in the Persian Gulf and the Sea of Oman.
A trial freight train delivered more than 400 tons of cement from Iran to Rozanak in Herat Province of Afghanistan on Dec. 2, ahead of the ceremonial inauguration of the newly completed railroad.
A passenger train also carried Iranian rail officials to and from a meeting with their Afghan counterparts.
Afghanistan Railway Authority said the line forms one of its most important regional connectivity projects, as it will provide the landlocked country with a link to Iranian ports and to the rail networks of Iran, Turkey and Europe.
Freight traffic is predicted to be around 2 million tons a year, with imports to include oil, construction materials and food, and exports to include grain, dried fruit, plants and medical items.
AfRA said the operation of a passenger service is also being considered. Studies estimated that passenger traffic could reach 321 000 passengers/year and freight traffic 6·8 million tons/year.
The new line is the first 1,435 mm gauge route in Afghanistan, matching the standard gauge networks in Iran and Turkey. The 75-km Uzbekistan–Mazar-i-Sharif line and the two short cross-border lines from Turkmenistan to Afghanistan are 1,520 mm gauge, Railway Gazette reported.
“The annual transit to Afghanistan from the Commonwealth of Independent States and Turkey amounting to 1.2 million tons and 500,000 tons respectively can be redirected to Khaf-Herat railroad,” the head of the Islamic Republic of Iran Railways, Saeed Rasouli, was quoted as saying by the news portal of the Ministry of Roads and Urban Development.
The official noted that the Iranian government hopes the railroad will further increase social, economic and cultural ties between the two nations.
“We are counting on Khaf-Herat rail route to play a significant role in boosting interactions between Iran and Afghanistan.”
Referring to the economic significance of the project, officials of Herat Chamber of Commerce and Industries have said that the implementation of the project will help further expand exports and imports between the Islamic Republic of Iran and Afghanistan.
“Khaf rail project will help connect Herat to the entire world and develop our export ability,” said Abdul Latif Qanawizyan, the deputy head of Herat Chamber of Commerce and Industries.
Iranian officials have said that the project will also help Afghanistan get easy access to Iranian ports at Chabahar and Bandar Abbas.
Iran accounts for around half of Afghanistan's market, according to Iran’s commercial attaché to the neighboring country, Mohammad Mehdi Javanmard-Qassab.
Between $3 billion and $4 billion of Afghanistan’s annual imports of $6 billion to $7 billion are from Iran, he added.
“Afghanistan has huge capacity and demand in the field of technical and engineering services. This provides us with ample opportunity for the export of these services and the transfer of our technical know-how in different fields to Afghan businesses,” Javanmard-Qassab was quoted as saying by Fars News Agency.
