Why A Railway Network in Afghanistan?

Why Railroad Infrastructure is significant for Afghanistan:

“Utilizing our geopolitical position in Asia, we can provide economic transport solutions in the region. Therefore, the key policy of our Government is to complete the missing regional railway links in collaboration with our strategic partners and enable Afghanistan to become a transport and transit hub in the region” – Vision of the Government of Islamic Republic of Afghanistan.

Intraregional trade is very important for Afghanistan as the country provides an important geographic link between Central Asian and South Asian countries, especially with the potential to provide transit access to the ports of India, Iran, and Pakistan. Fostering regional connectivity will help countries improve productivity in accordance with natural comparative advantage, benefit from complementarities, and thus increase output, trade, and consumer welfare. Additionally, Afghanistan has vast potential for developing mineral extraction industries, which may be engine of self-sustaining economic growth in the future. Afghanistan Rail Road Network Development Plan has been based on several studies (prefeasibility and feasibility studies) carried out by the ADB in 2010, by the Railway Department of Government of Pakistan in 2012, by the UNCENTCOM (US Central Command) in collaboration with different Sectoral Ministries of Government of Islamic Republic of Afghanistan in 2013, MCC (Metallurgical Corporation of China) in 2013, SudaPraha Czechoslovakia in 2013, and by ADB Supported Study through CANARAIL Consultants in 2016 .

The extensive studies and reports are accepted by the Government and ARA (Afghanistan Railway Authority) developed ANRP (Afghanistan National Railway Plan) with a vision to construct over 5000 km of railway track, 4 Dry ports and 8 Multimodal Hubs. The Regional Connectivity has already been established through Railway Freight Corridors with Uzbekistan, Turkmenistan, and Iran with the plan to connect to other CIS Countries, West Asia through Iran and to South Asia through Pakistan. Number of Bilateral and Multilateral Cooperation Agreements have been signed to establish the Regional Railway Infrastructure connecting Afghanistan with all the Sub-continents of Asia and with Europe.

Afghanistan’s transport system is comprised of roads, railways, airports, and inland waterways, although roads by far account for most of the country’s infrastructure inventory and carry the clear majority of the passenger and freight traffic. In contrast, the total length of railways is only about 100 km, which include the cross-border extensions from Turkmenistan and Uzbekistan and the newly constructed Hairatan to Mazar-e-Sharif railway line (75 km). Given its mineral extraction potential and its strategic location, Afghanistan’s railway subsector is underdeveloped and warrants urgent attention. Extension of the railways will foster cross border and regional trade, increase rail usage and the viability of the initial railway investment, and introduce competition in rail operations. The National Railway Development Plan and its implementation is one of the Government’s key priorities and therefore, the Afghanistan Railway Authority under the leadership and full support of the Ministry of Finance of the Islamic Republic of Afghanistan, is continuous looking forward for the good and sound investment in the railway sector and its coordination on bilateral banking partners and countries’ financial assistance.

The Afghanistan Railway Authority (ARA) was established in November 2012 within the Ministry of Public Works (MoPW) following the decision of the Afghan Government’s Cabinet. GoIRA cabinet in its approval notification no. 38 dated 1st January, 2016 decided that ARA should be a budgetary unit of GoIRA. Now it is an independent government authority and is the governing body for all railway sector planning, implementation of the National Railway Plan, development of network, operations and maintenance (O&M) of the railways in the country. More importantly, ARA is responsible for the legal and regulatory policies governing rail investment, development, and operations.

ARA also coordinates with various national and international institutions and organizations to develop and operate the Afghanistan Railway Network, including fund raising, construction, operations, maintenance and management of the national railway infrastructure. ARA is responsible for legal and regulatory policies governing rail investment, development, and operations. This includes the regulatory oversight needed for a safe, efficient, and reliable rail network. ARA stands committed to the safe and efficient movement of resources, goods and people throughout Afghanistan by developing integrated sustainable policies and building regional and international partnerships.

To achieve the long-term objective, the Government of Islamic Republic of Afghanistan (GoIRA) Proposes to implement the Afghanistan National Railway Plan (ANRP) developed by ARA. ANRP is primarily designed to take advantage of country’s strategic location and link China to the middle-east and Europe as well as linking Central Asian Republics with the southern Asian countries. ANRP has also been identified as one of twelve Priority Investment Projects (PIPs) as part of the New Silk Road Initiative (NSRI).

ARA is in the early stage of establishment. Current staff level consists of approximately 200 including managers, engineers, technicians and administrative staff. At present, much of ARA’s efforts focus on administering GoIRA budget financed construction and maintenance works and some aid-financed projects. ARA is in the process of developing as an institution and its staff require substantial skills enhancement to perform their current duties. In addition, a restructuring of the organization and a business plan are needed to upgrade ARA commensurate with the envisaged sector governance role.

Railroad development is expected to increase domestic economic growth, regional connectivity, and promote a positive economic environment, which will foster private sector investment including emerge as an enabler for the peace and reconciliation in the Country. The National and International Sponsorship of Rail Sector Development will also stimulate the self-reliance and a contributor to the goals set out under the Afghanistan National Peace and Development Framework, National Priority Programme of the Infrastructure Project Development Plan and also in supporting the cause of Sustainable Development Goals of Afghanistan. Railway transport post its maturity will prove to be the real engine of growth t in leveraging the Extractive Industries and exploitation of Mineral Wealth for the Economic well-being of the Nation and the Region.

Significance of Afghanistan Railway as the Central Instrument for Regional Economic Cooperation Conference on Afghanistan(RECCA):

Afghanistan as the land-bridge of the region, connecting Central Asia to South Asia, will provide land routes for Chinese goods to Europe, serve as the hub for the Silk Road’s trade and transit route and provide access to warm ports for Central Asian nations via Chabahar and Gwadar ports. Achieving this vision will result in stronger regional economic integration, economic growth, employment, and alleviate poverty.

Triggers /Accomplishments on the for Regional Railway Network Development Frontier:

Afghanistan being the Heart of Asia has potential to emerge as the Regional Hub for the Trade and Transit in the Region, which will potentially and technically will aid to the revival of the Silk Route. Few salient points in the area of Regional Solidarity through the Railways are indicated as under:

Assess the significance and growth of railways in the region, especially in the context of the Afghanistan Railway Network.

Assess the institutional capacities, and gaps to promote an integrated railway system.

Assess the commercial aspects of regional integration within the Region and Beyond.

Identify strategies for economic growth and inform policy development for encouraging opportunities, and collaborations.

The Five-Nations’ Railway Corridor is also in conjunction with the infrastructure development related to railways such as CAREC, International Transport and Transit Corridor (the Chabahar Agreement), Lapis Lazuli Transit and Transport Route (the Lapis Lazuli Corridor), TAT, ECO, and OBOR (the OBOR Initiative). The broader objective of such regional connectivity is also in conformity with the Silk Road legacy of trade and transit through this location as well as being in line with the aspirations of the Trans-Asian Railway Network for improved trade and transport for shared prosperity of the region and globe as a whole.

Central Asia has great potential to benefit from growing Eurasian transit traffic and the intraregional trade which will develop in the coming decades.

Afghanistan seeks to integrate with the regional railway network for over 4 430 km by 2030 under its approved Afghanistan National Railway Plan – segregated into corridors and different projects.

Trade and investment must get the highest priority by considering tariff, and non-tariff barriers to trade, and foreign direct investment.

Different Regional Connectivity Projects will foster in the development of Afghanistan as the Regional Hub of Transport, Trade, and Transportation.

Asia’s extraordinary transformation in the last few decades signifies how trade, and transport affect a region, resulting in reduction of poverty.

Afghanistan can learn from the experience of other Asian countries and focus on creating a national production network that would be able to export its products throughout the region, and beyond, besides attracting foreign investors.

Regional integration makes way for transportation, and logistics support but abundant skilled labour, capital investments, and advanced technology will determine the sustainability, and efficiency.

For Afghanistan, the correct method may be to work on providing security, and safety for investors as well as work on economic interdependence with international and intra-national firms. The government’s economic policies will drive the process of integration.

Afghanistan can promote its potential only if accompanied by supporting software components that address various types of impediments related to policies, regulations, procedures and standards.

One of the other main issues in projects that require huge infrastructure is to focus on two important components, “hardware”, and “software”. Infrastructure (or hardware) is only a part of the regional connectivity: software needs to be concentrated upon and developed to ensure the smooth flow of all assets. Hardware refers to components of physical infrastructure that facilitate physical connectivity, e.g. transmission lines and turbines represent hardware, whereas regulatory frameworks, policies, agreements, etc. are software. The barriers to customs, trade facilitation, cross-border movement of people and goods must be removed to increase efficiency, reduce transport costs, and maximize the economic benefits of Afghanistan’s integration with regional networks.

Reference Source: RECCA Secretariat (MOFA) GIROA, and Different Status Notes of the Government of Islamic Republic of Afghanistan, ADB, WB etc.