Economy, Business And Markets

Qatar-Turkey Trade Route Via Iran to Cut Transportation Cost

Qatar-Turkey Trade Route Via Iran to Cut Transportation Cost
Qatar-Turkey Trade Route Via Iran to Cut Transportation Cost

The newly-announced land trade route from Turkey to Qatar passing through Iran is expected to significantly reduce the cost of transportation of goods. The trade line will lead to a decline of nearly 80% in the transportation cost of food items compared to air freight charges, say experts.

Mohammed bin Mahdi Al Ahbabi, a board member of Qatar Chamber of Commerce and Industry, said, “The new land trade line between Turkey and Qatar via Iran will reduce the cost of transport of goods by about 80% compared to air cargo,” the Doha-based English-language newspaper The Peninsula reported.

Ahbabi, also the head of Trade and Research Committee at QC, who recently headed a 100-member trade delegation to Turkey, added that the cost of air freight is ranging between $1.2 and $1.5 per kg, while the cost of road transport per kg is approximately $0.15.

He noted that the new trade line will be more sustainable and reliable, and boost the Turkey-Qatar trade volume manifold, given the fact businessmen from both countries have signed scores of trade agreements, especially during their recent visit to Turkey from August 3-6.

Turkey’s Economy Minister Nihat Zeybekci last week announced plans to use a land route through Iran to export goods to Qatar.

The sea route between Turkey and Qatar initially took 11 days, while the land route took 14 days. And recent experiments have reduced this duration to nine days. And Turkey aims at reducing the travel time to five or six days or even less.

But the newly propounded commercial land transport line, from Turkey’s Mardin city to Iran’s Bushehr Port, will further shorten the duration to two or three days at the most. The distance between Mardin (Turkey) and Bushehr (Iran) is about 1,700 km, which can be traveled by trucks in about 22 hours, while the distance between the Iranian port of Bushehr and Qatar’s Hamad Port is not much and the Turkish trucks can cross this distance between the two ports on Ro-Ro ships in just 8 hours. So a truck with Turkish goods can reach Doha through this route in less than two days.

“Given the nature of some food items, such as vegetables, fruits, poultry and dairy products, land transport is the best way to import them. The new route will not only bring the cost of transportation down significantly, but the items that reach will be more fresh and of better quality”, says Ahmed Al Khalaf, chairman of International Projects Development Company, the parent company of Qatar Meat.

He said some Turkish foodstuff has already started coming through the new land route after Turkey and Iran verbally agreed on it. But the official announcement is expected to be made this week.

Yet another prominent Qatari businessman, Ali Hassan Al Khalaf, chairman of Qatar Consumer Complexes, that also runs a chain of retail outlets, across the country, said, “The new land route is going to be more sustainable and economically viable in the days to come. As more and more importers start using the route, the economies of scale will come into play, which will help further reduce the transportation cost.”

He said that in the coming days even the neighboring countries of Turkey and Iran, such as Russia and Pakistan, can also benefit from the new land route to export their goods to Qatar. He also said Iran has developed a wide network of road and rail lines, which will help the movement of goods much smoother and faster.

Khalaf noted that unlike the previously-used Saudi land route, the Turkey-Iran-Qatar route will have lesser number of checkpoints, which will ensure the faster movement of trucks. This will not only save a lot of time and money, but goods will reach without losing much of their nutrition value.

“The new trade line will have a direct impact on the volume of trade exchange between Qatar and Turkey in the next phase. And the recently signed trade agreements between businessmen of two friendly countries will further ease the flow of goods,” Saleh bin Hamad Al Sharqi, director general of the Qatar Chamber of Commerce and Industry, was quoted as saying.

Sharqi said the focus on this trade line would be food items, especially those stuff that were traditionally imported by land route before the blockade. He also pointed out that the new land route will not affect the movement of non-food goods imported by sea transport from Turkey to Hamad Port.

Iran, for its part, has been supplying the Qatari market ever since Saudi Arabia and its allies cut relations with Doha.

Mohammad Mehdi Bonchari, director of ports in Iran’s Bushehr Province, said late June that 1,100 tons of food are being shipped from Iran to Qatar every day.

Saudi Arabia, the UAE, Bahrain and Egypt announced on June 5 the suspension of all ties to Qatar over what they say is its support for extremist groups and its political proximity to Iran, Fars News Agency reported. Qatar denies the allegations.

Iran has urged Qatar and Persian Gulf neighbors to engage in dialogue to resolve their dispute.

Foreign Minister Mohammad Javad Zarif has called for a permanent mechanism in the Persian Gulf to resolve crises like the blockade against Qatar.

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