On a new track
Rail activities are losing ground to the roads worldwide. In Iran the national rail firm RAI is modernising and expanding its infrastructure and rolling stock, and linking international markets through cross-border routes. Saeid Rasouli, president of RAI since March, gave the ITJ an exclusive interview recently, laying out the details of RAI’s strategy.
Iran’s public transport sector adheres to the modal split; the CEO of every mode of transport is fortified with the title of deputy minister for transport, with his own department, which he manages separately as a government minister. The Iranian Railways of the Islamic Republic of Iran (RAI) is managed by its president, Saeid Rasouli, who was appointed to his new position in March this year.
He has, however, known both the company and the profession for much longer than that, having been a board member of RAI since 2017 and its vice-president for planning and transport economics. The ITJ met him in his office in RAI’s headquarters in Teheran, a building no less impressive architecturally than La Défense in Paris.
Railfreight a priority
RAI is even older than the ITJ, it has to be said. The company has already been a public sector undertaking for 81 years, and has been operational for even longer than that before it was unified. The ITJ, in turn, is celebrating its 80th anniversary in July.
This is not to say that the railway sector is approached mainly from a historical perspective in Iran; far from it. The political and economic importance of the railways is evident all around. The country’s sixth development plan, which began in 2016, places the development of the rail network, including railfreight operations, at the very top of a list of national priorities. This means, amongst other things, that 1% of government revenues from oil and gas exports have flown into the expansion of the rail network since 2016, as well as into modernising and re-equipping the railways.
“In the meantime a number of new laws and regulations have also been passed by parliament as well as by the executive branch of our government,” Rasouli said. “These new laws have significantly improved the framework conditions for national and international investors.”
One of the various measures he was referring to is a package that allows the government to provide the private sector with a guaranteed exchange rate for foreign exchange transactions. In the light of the overall volatility of Iran’s national currency, this provision is one of the important signals of the government’s commitment to seeing through collaboration with investors. These can also benefit from price reductions for products, depending on the level of investment.
Extensive ambitious goals
Since railfreight is ecologically more efficient than road transport, the idea in Tehran is to push ahead with the modal shift. The bar has been set rather high, however. If everything goes according to plan, 30% of freight traffic in the country – imports, exports and transit goods – will be carried by rail by the year 2021. Rasouli acknowledges that rail’s current share in the modal split comes to just 13.5%.
“We have put a comprehensive programme in place, to make sure there is the required momentum to achieve the goal,” the president of RAI elaborated. “In addition to developing infrastructure, stations, signalling stations and terminals, we’re also training staff.” Iran’s rail network is currently also being electrified. Whilst the network is still only electrified in parts, the aim is to focus this work on high-speed rail segments. The Russian railway enterprise RŽD is not the only partner; other collaborators are also on board.
New locomotives and new routes
Rasouli admits that not all of the fleet of locomotives and waggons in Iran meets today’s transport and logistics requirements. “We’re planning to renew our rolling stock, to make the railways fit for current and future requirements,” the president of RAI confirmed. EUR 150 million has recently been budgeted for these projects, with funds coming partly from public financing and partly through bank loans. Here, too, cooperation with international partners is one of RAI’s priorities.
The Iranian technology group Mapna’s long-standing collaboration agreement with Germany’s Siemens corporation will lead to the further delivery of a new generation of locomotives of the Mapna Siemens Eurorunner 24 type. 40 more such locomotives, which are also suitable to haul freight services, are currently being manufactured and will be assembled in Mapna’s factory in Karaj (Teheran). An order for 800 new waggons has also been placed, with the number expected to go up to 1,600 by the year 2020.
On monitors in his office the president can follow the progress of ongoing expansion activities at more than 250 building sites in Iran, including in Aprin, Bandar Abbas and Tabriz. There is a strong interest in the development of further international routes. A 32 km stretch of tracks, including a bridge over the river Arvand, will start in Shalamcheh in Iran and end in the Iraqi port of Basra. The project was agreed a few weeks ago by politicians from both countries.
“The route to Herat (Afghanistan) will soon be operational too,” Rasouli added. It is an example of RAI’s transnational efforts. To strengthen services to and from Afghanistan, RAI is also focusing on expanding the hinterland route from the port of Chabahar to Zahedan (Iran). The firm is responding to opportunities opened up by the expansion of trade with its East Asian neighbours. It is clear that there is no lack of political will for these activities, as we registered in Tehran.
