THE government of Iraq is pressing ahead with the Route of Development, an ambitious $US 17bn project that includes building 1200km of double-track railway to move passengers and freight between the Grand Port at Al Faw in Basra province and the Turkish border. The project also includes construction of new motorways, logistics centres and industrial complexes. The government estimates that the project will generate $US 4bn a year and create at least 100,000 jobs.
The new railway from Al Faw to Ovaköy in Turkey is planned to have approximately 15 stations, and the government of Iraq envisions high-speed trains moving passengers at speeds of up to 300km/h. Stations would be strategically located in major cities such as Basra, Baghdad and Mosul, facilitating the seamless movement of passengers throughout the region.
The Route of Development’s railway component would have initial capacity to carry 22 million tonnes of bulk freight and 3.5 million containers a year, which would be increased under a phased programme to reach 33 million tonnes and 7.5 million containers annually. Initial capacity would also be sufficient to carry up to 13.8 million passengers a year.
The Italian consultancy Progetti Europa & Global (PEG), which has an Iraqi branch in Baghdad, has completed and submitted a pre-feasibility study for the project to the Iraqi government. As well as an initial alignment and proposals for related facilities, the study includes estimates of the capital expenditure required, and financing options.
The project was unveiled at a one-day conference in Baghdad on May 27 2023. The event brought together transport ministers and other officials from Iran, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, Syria, Turkey and the United Arab Emirates (UAE), as well as the Gulf Cooperation Council (GCC). “The Route of Development project is an ambitious and well-studied plan towards a strong and successful economy,” Iraq’s prime minister, Mr Mohammed Shia Al Sudani, told the conference. “We see it as a cornerstone for a sustainable non-oil economy, serving Iraq’s neighbours and the region and contributing to efforts for economic integration.”
Al Sudani added that the Route of Development “will take all the peoples of the region to an unprecedented stage of communication and integration and that means more stability and capability to face challenges.” Cooperating on the project is expected to boost the security and stability of the region and preserve its economy. A number of proposals were discussed at the conference on how the Route of Development might be financed, ranging from government investment to the creation of a sovereign fund combining government money with investor contributions and loans. Joint legal, technical, financial and management committees were subsequently formed to progress financing and implementation.
Alternative
By connecting Iraq with Europe by rail via Turkey, the project offers an alternative to traditional sea routes, with the potential to lower transport costs and reduce transit times. It will not only benefit those countries participating in the project but also the broader global trade network. Through the Route of Development and the Grand Port now under construction at Al Faw on the Persian Gulf, Iraq is keen to join China’s Belt and Road Initiative (BRI), the global strategy involving infrastructure development projects and investment in 70 countries in Asia, Africa and Europe.
Despite its oil wealth, with about 145 billion barrels of proven reserves, Iraq lags behind neighbouring economies due to decades of war since the 1980s, economic sanctions imposed by the United Nations (UN) following Iraq’s invasion of Kuwait in the 1990s, and the unstable political and security environment in the wake of the US-led invasion of Iraq in 2003.
Speaking at the conference on May 27, the World Bank’s country manager and special representative in Iraq, Mr Richard Abdulnour, said that building new infrastructure was essential for “unleashing the geographical potential of Iraq,” expressing the bank’s readiness to support the Road of Development project.
The Route of Development project is an ambitious and well-studied plan towards a strong and successful economy.
The existing railway between Iraq and Turkey was reopened in the late 1990s after Iraq restored relations with Syria and Turkey. Demand was high from passengers, mainly pilgrims travelling to and from Syria, as well as from freight shippers. But this revival was short-lived, as Turkey asked Iraq to withdraw services only days before the US invasion started on March 19 2003.
The poor security situation in much of northern Iraq after the invasion hindered plans to reactivate the line. Then came the 2014 Isis onslaught in large areas of the north and west of Iraq, and military operations to drive the militants out. This left stations and other railway infrastructure heavily damaged, with plans for repairs hindered by a lack of funding. In the south of Iraq, at present only two passenger trains operate a day, connecting Baghdad with Basra, and serving intermediate stations at Hillah, Diwaniyah, Samawah and Nasiriyah.
Iraq’s strategic geographical location gives it a unique advantage and the potential to become a major transport hub for the movement of people and goods between the Gulf region, Turkey and Europe. The Route of Development project aims to tap this potential, including by increasing capacity at Al Faw to enable efficient intermodal transfer of freight between maritime and land transport. Al Faw and its associated terminal facilities will cover over 100ha, with 2km of container berths and capacity to handle 99 million tonnes of freight a year.
However, some experts question the feasibility of this element of the project, highlighting the preference for direct shipping routes that do not require intermediate loading and unloading. Consideration should be given to evolving global transport dynamics and customer preferences, they say.
Iraq needs to invest more than $US 21bn in the coming five years on transport, Abdulnour told the conference, noting that the transport sector has contributed 9% of Iraq’s GDP and has grown by 7.4% a year over the last 10 years. Dilapidated infrastructure is one of the major challenges facing Iraq’s transport sector, where efficient connectivity is impeded by the poor state of the country’s roads and inadequate maintenance. The Route of Development presents an opportunity to address these issues comprehensively by investing in the reconstruction and upgrading of Iraq’s transport network.
Having approved the pre-feasibility study prepared by PEG, the Iraqi government conducted a series of meetings and workshops to share its findings with the project partners in Baghdad on June 13-15 2023. Discussions were also held to identify the next steps for the project, considering the financial model and implementation schedule. Preliminary design of the new railway is now 66% complete, with geotechnical surveys of the route also well advanced, having been undertaken on 1000km of the alignment.
Work continues to develop the funding structure and the tendering strategy. While delivering the Route of Development will require extensive collaboration and further discussion, the estimated timescale for delivering this major endeavour is between just three and five years. The project aims to encourage participating countries to contribute to its development, allowing them to engage in specific sections as suits their interest and capabilities.
