Central Asia’s Transport Revolution: How new railway corridors are reshaping global trade

0
34
Central Asia's Transport Revolution: How new railway corridors are reshaping global trade

TASHKENT, DEC 4 /DNA/ – In recent years, thanks to Uzbekistan’s proactive regional policy, Central Asia has become consolidated, stable and sustainable, becoming one of the important centres of economic growth and regaining its historical role in connecting the West with the East and the North with the South.

Today, more than 10 international transport corridors pass through the territory of Central Asian countries, including 3 of the 5 corridors of the Eurasian transport framework: the Central Eurasian Corridor, TRACECA and the Eastern Route of the ITC “North-South”. In addition, the process of implementing new railway corridors has begun, such as “China – Kyrgyzstan – Uzbekistan”, “Uzbekistan – Afghanistan – Pakistan”, as well as multimodal corridors “Uzbekistan – Turkmenistan – Iran –Turkiye” and “Belarus – Russia – Kazakhstan – Uzbekistan – Afghanistan – Pakistan” for the development of trade between Asia – Europe and North – South.

At the same time, the specified current and ongoing projects will make a major contribution to the creation of favorable conditions for long-term and multilateral cooperation on issues of forming an interconnected regional transport and communication system of the countries of the region.

This will also ensure the connectivity of Central Asia with the largest sea ports and world markets, which is very important for the region due to the significant distances to the nearest sea ports.

For example, the distance to the seaport of Karachi is 1.5 thousand km from Tajikistan, to Bandar Abbas – 1.6 thousand km from Turkmenistan and 2.7 thousand km from Uzbekistan, to Lianyungang – 3.7 thousand km from Kazakhstan and to St. Petersburg – 4.5 thousand km from Kyrgyzstan.

In this regard, interaction in the formation of an extensive transport and communications system will allow to fully realize the transport and transit potential of Central Asia and create conditions for access to seaports.

Firstly, today more than 80% of the total volume of world trade is carried out by sea, and according to UNCTAD, the share of countries far from it accounts for less than 1% of world exports, and the Central Asian countries – even lower (on average 0.43%): Uzbekistan – 0.1%, Kazakhstan – 0.3%, Tajikistan – 0.007%, Kyrgyzstan – 0.03%.

In order to compete in foreign markets, Central Asian countries are forced to reduce prices and enter into rather expensive import transactions to the detriment of their own interests. In the long term, this may put additional strain on the regional economy.

Secondly, without access to the sea, Central Asian countries cannot actively integrate into the international transport services market, which is growing faster than the global economy as a whole.

Over the past 10 years, global GDP has grown 1.3 times to $105 trillion by the end of 2023, and the international transport market has grown almost 3 times and reached $6 trillion. The share of the international transport market in the global economy increased from 2.5% to 6% in 2013-2023.

Thirdly, according to estimates by international organizations and experts, by 2050 the demand for freight transportation in the world will grow threefold, and in the region – even more, taking into account demographic growth. If in the next 25 years the world population grows by 15%, then in Central Asia – by 25%.

Of course, sea transport will still dominate with a share of 70-80%, but at the same time, a gradual capture of the market by rail and road transport is expected, since land corridors have a competitive advantage – delivery speed, which is two to three times higher than on sea routes.

Taking this into account, strengthening the transport and communication interconnectivity of the Central Asian states is one of the important factors in achieving the general economic prosperity of the region and a key condition for its integration into the global transport system.

The main thing is that Central Asia has formed a common understanding of this trend and there is a demand for the creation of new promising transport and transit corridors in order to enter foreign markets.

In this context, the relevance of the initiative to establish under the auspices of the UN Regional Center for the Development of Transport and Communications Links in Central Asia, put forward by the leader of Uzbekistan in September 2020 at the 75th session of the General Assembly, which was immediately supported by the heads of state during the Consultative Meeting in Turkmenistan in August 2021, is increasing.

This initiative is a logical continuation of the policy of President Shavkat Mirziyoyev aimed at further strengthening regional cooperation and ensuring high transport connectivity, which contributes to the dynamic growth of intraregional trade, the volume of which increased by 4.5 times by the end of 2023 from $2.4 billion in 2016.

In this regard, further implementation of the above initiative will create a unified transport network in Central Asia with high quality standards, and in general will become a prerequisite for sustainable development of the region.

Such a result can only be achieved with a comprehensive approach to improving the transport infrastructure in Central Asia.

For its part, Uzbekistan has been taking proactive measures in recent years to strengthen the transport connectivity of Central Asian countries.

Since 2016, Tashkent has unblocked and established transport and communication links with neighboring republics. At the same time, the Turkmenabad-Farab railway and road bridges across the Amu Darya, the Galaba-Amuzang-Khoshadi railway line connecting the Surkhandarya and Khatlon regions were opened, a high-speed train Tashkent-Almaty and high-speed passenger service along this route were established. Thus, Uzbekistan has made its feasible contribution to ensuring the interconnectedness of the region, eliminating various barriers to international transportation across the border.

At the same time, measures are being taken in Uzbekistan to improve the transport infrastructure. In recent years, thanks to an active investment policy in the transport sector:

1) new electrified railway lines Guzar – Boysun – Kumkurgan, Bukhara – Misken, Yangiyer – Jizzakh, Yangiyer – Farhad, Shavat – Karauzak, a railway and road bridge across the Amu Darya, as well as 11 international airports have been built;

2) high-speed passenger train service Tashkent – Samarkand – Navoi – Bukhara and Tashkent – Samarkand – Karshi has been organized; it is planned to launch such routes in the directions Tashkent – Bukhara – Khiva and Tashkent – Chirchik – Khodjikent;

3) the economic activity of the river port “Termez”, which carries out cargo transportation along the Amu Darya River to Afghanistan, has been improved;

4) the Tashkent-South railway station has been reconstructed and the Tashkent passenger bus station has been modernized.

A historic event was the creation of the Angren-Pap electrified railway line, with a total length of 123 km, including a 19.2 km tunnel on high-mountainous sections reaching 1,400 km above sea level. The new line will be part of the China-Kyrgyzstan-Uzbekistan transport corridor.

Role and significance of the China-Kyrgyzstan-Uzbekistan railway in achieving common economic prosperity of Central Asian countries

The existing transport corridors in the region undoubtedly have great potential for the development of Central Asia.

However, the existing difficulties in carrying out transportation through major world ports and the exhaustion of the Suez Canal’s capacity as a whole indicate an urgent need to develop qualitatively new land transport communications between global markets.

Today, the countries of Central Asia have an exceptional chance and strategic opportunities to become not only a link between the huge markets of the East, West and Southeast Asia, but also to rethink their place in the world transport systems.

In this context, the China-Kyrgyzstan-Uzbekistan railway project, proposed by China back in 1997 at the TRACECA meeting in Paris, is very beneficial for the development of the economies of both Central Asia and Eurasia as a whole.

It should be noted that at the initial stage there were controversial issues regarding the choice of routes; the parties could not reach an agreement on the width of the railway track for 20 years.

Thanks to the strong political will of the heads of Uzbekistan and Kyrgyzstan, negotiations on the construction of the China-Kyrgyzstan-Uzbekistan railway project have significantly intensified since 2016, and the basis for its implementation was China’s “One Belt – One Road” initiative, first announced in Kazakhstan in 2013.

On June 6 of this year, in Beijing, Uzbekistan, Kyrgyzstan and China solemnly signed an intergovernmental agreement on the implementation of the railway construction project.

The new route, which runs along the historic Great Silk Road, will become the shortest land link connecting China with the Central Asian region.

The corridor will run along the route Kashgar – Torugart – Makmal – Jalalabad – Andijan, with a total length of about 454 km. At the Makmal transshipment station, it is planned to change the gauge from 1435 mm to 1520 mm.

To date, China, Kyrgyzstan and Uzbekistan already have experience of mutually acceptable cooperation in the field of transport.

Since 2018, the parties have been successfully using the Tashkent-Andijan-Osh-Irkeshtam-Kashgar highway (920 km), which allowed road carriers from Uzbekistan and Kyrgyzstan to directly access China. In 2023, the volume of cargo via the highway reached about 750 thousand tons, an increase of 7.5 times compared to 2018. The launch of this route reduced the delivery time of goods from Uzbekistan to China by 4 times from 8-10 days to 2 days. If necessary, urgent cargo can be delivered in 24 hours.

Taking this into account, the China-Kyrgyzstan-Uzbekistan railway project is in high demand, reliable and promising.

Firstly, currently the bulk of cargo to Europe from eastern China is sent by sea, which takes six weeks. At the same time, it is cheaper for Chinese manufacturers to deliver goods to the West by land routes than by air, and faster than by sea. In this regard, the highway will shorten the route from East Asia to Europe by about 900 km, and the time frame will be reduced by 7-8 days. According to the ADB, reducing travel time by one day along this corridor could increase the volume of trade between the countries by 5.7%;

Secondly, the corridor will ensure the development of the transport infrastructure of the Central Asian countries and provide them with convenient access to the ports of the Persian Gulf and the Pacific Ocean. It is expected that about 15 million tons of cargo and about 300 thousand passengers will be transported by rail annually.

Direct access to Chinese markets and tourist attractions will be opened for citizens of the Central Asian states.

Thirdly, the implementation of the project has undeniable advantages for the development of the multimodal route “China – Kyrgyzstan – Uzbekistan – Turkmenistan – Iran –Turkiye– Europe”. The corresponding protocol on the formation of this corridor was signed by the ministries of transport of Uzbekistan, Turkmenistan, Iran and Turkiye in November 2023 in Tashkent.

The new corridor can become the shortest monomodal railway line, up to 5.5 thousand km long, connecting China and Europe.

Fourthly, the implementation of the China – Kyrgyzstan – Uzbekistan railway project gives impetus to all Central Asian countries to create a single transport hub between Europe, China and the countries of Southeast Asia. Thus, the region is turning into a kind of international driver for the development of the economy, science, culture, technology and industry, and this is more than 10 thousand jobs.

Fifthly, the China-Kyrgyzstan-Uzbekistan railway line is of particular importance in the development of the Afghan economy, as it can attract additional cargo flow to the Trans-Afghan route. This will be one of the first practical steps aimed at improving the socio-economic situation in this country in the new realities and integrating Afghanistan into the Central Asian transport system.

In September 2022, in Tashkent, a protocol was signed between logistics companies and the railway administrations of China, Kyrgyzstan, Uzbekistan and Afghanistan on the formation of a multimodal route “China – Kyrgyzstan – Uzbekistan – Afghanistan” with discounts for the transportation of container trains through the territory of Kyrgyzstan and Afghanistan up to 50%, Uzbekistan – up to 70%.

The Uzbekistan-Afghanistan-Pakistan railway will open a completely new and shortest route to promising markets of South Asia and sea ports

Given the important geostrategic position of Central Asia, which historically serves as a link between the largest world markets via the Silk Road route, in modern conditions there is an increasing need to unite the efforts of the countries of the region in order to accelerate their integration into the southern transport systems through the territory of Afghanistan.

In this regard, the special resolution of the UN General Assembly on strengthening the connectivity between Central and South Asia, adopted in July 2022 at the initiative of Uzbekistan, plays an important role.

The document, co-authored by all Central Asian countries, reflects provisions on establishing close cooperation between the regions to expand transport infrastructure and form new international transport corridors that open up convenient, sustainable and safe routes to seaports.

According to UN estimates, due to effective transport cooperation with Afghanistan, the total GDP of Central Asian countries can grow at least 2-fold in the next 10 years. Taking this into account, this issue comes to the fore as a point of direct access for Uzbekistan and other Central Asian countries to the seaports of India.

For these purposes, in May 2023, a Project Office for the Coordination of the Construction of the Uzbekistan-Afghanistan-Pakistan Railway Line was opened in Tashkent, and its branches were also opened in the cities of Kabul and Islamabad.

In July 2023, the final route of the corridor was agreed upon in Islamabad –“Termez-Naibabad-Logar-Kharlachi” and a roadmap for coordinating the work of the project office was adopted.

In August 2024, a ceremonial opening of the Naibabad railway station, restored by the Uzbek side, took place. On August 7, the first freight cars arrived at this station, symbolizing the beginning of a new stage in the development of regional infrastructure and strengthening of economic ties between the countries of Central and South Asia.

As part of the entire project, the estimated length of the railway from Naibabad to Kharlachi will be 647 km with a 1520 mm gauge and a transition to a 1676 mm gauge at the Afghan-Pakistani border. It is planned to build about 25 railway stations and sidings, 69 km of station tracks, 135 km of tunnels, 62 km of bridges and overpasses.

The key advantages of the Uzbekistan-Afghanistan-Pakistan corridor are:

First, the new route will unite the entire Eurasian railway network into a single whole for the first time.

When implementing the railway construction project, it will be possible to connect: 1) the countries with the largest populations in the world – India and China along the route “India – Pakistan – Afghanistan – Uzbekistan – Kyrgyzstan – Western China” and 2) India with Belarus along the new multimodal route “Belarus – Russia – Kazakhstan – Uzbekistan – Afghanistan – Pakistan – Indian Ocean ports”, on the formation of which a memorandum was signed between Uzbekistan, Kazakhstan and Russia in Tashkent in November 2023. In April of this year, Belarus joined the memorandum, and in September Pakistan.

Secondly, the construction of the trans-Afghan corridor will diversify transport flows in Central Asia. In particular, the countries of the region will have two routes to the southern seas. On the one hand, the existing corridors to the ports of Chabahar and Bandar Abbas, on the other –“Termez–Naibadat– Logar –Harlachi” with subsequent access to the ports of Karachi and Gwadar by the shortest route.

Thirdly, after the launch of the railway line, the logistics of transporting export-import cargo from Afghanistan will be improved, which will significantly reduce the delivery time of goods to Central Asia, China, the CIS and Europe. For example, with the full implementation of the project, it will take only 3-5 days to transport goods from Pakistan to Uzbekistan instead of 35.

The new railway will also reduce the cost of transporting goods to and from the Indian Ocean ports by 30-40%. The estimated volumes of annual transportation along the new railway could reach 22 million tons by 2030, and 34 million tons by 2040. More than 20% of the cargo will go to Afghanistan.

Fourth, with the launch of the railway, new technologies and innovations in various fields will come to Afghanistan. The multiplier socio-economic effect will be expressed in the creation of new jobs, the construction of roadside infrastructure, and dozens of mineral deposits along the railway route may be involved in economic turnover. More than 5 million jobs will also be created, new highly paid professions for the country will be formed, including those related to the operation of railway transport.

In a word, the railway construction project will make a real contribution to the development of the Afghan economy and the improvement of the socio-economic well-being of the Afghan people.

In general, despite the geographical isolation of Uzbekistan and the region, the Central Asian countries skillfully use their logistics potential to strengthen intra-regional and inter-regional connectivity, which increases the transport and transit attractiveness of the region.

The implementation of the China-Kyrgyzstan-Uzbekistan and Uzbekistan-Afghanistan-Pakistan railway projects, which are the “projects of the century” for our countries, will undoubtedly allow the region to take an important place in world trade.

In our opinion, with the construction of these corridors, which play a major role in the more rapid economic development of Central Asia and the formation of the transport framework of Eurasia, the formation of full-fledged Transcontinental transport corridors “China – Central Asia – South Asia – Middle East” and “China – Central Asia – South Caucasus – Europe”, “South Asia – Central Asia – CIS – Europe” will be completed.

Continuing this logical thought, we can already confidently state that the collaboration of all these corridors is a key condition not only for the withdrawal of the Central Asian countries from transport isolation, but also the revival of the historical transit role of the region in the very center of the Great Silk Road, which connected East Asia with the Middle East and Europe for three millennia.

All this predetermines the need for continuous development and improvement of the transport sector. In this direction, it seems important to continue diversifying the logistics capabilities of the Central Asian countries, which could master part of the transit cargo turnover on land routes between different regions of the Eurasian continent. It is important not to miss the chance to take advantage of these, to intensify the dialogue on them with all interested parties.

In this regard, the initiative of the President of Uzbekistan Shavkat Mirziyoyev, voiced in June of this year at the informal summit of the Organization of Turkic States on the formation of the Council of Railway Administrations within the organization and the placement of its directorate in Tashkent, is relevant.

The Council could act as a regulator for the integration of railways of China, the Asia-Pacific region, South and Southeast Asia with the countries of Central Asia, the Caucasus and the European Union.

To summarize, it can be stated that interaction in the transport sector is acquiring a strategic nature for all Central Asian countries.

Uzbekistan, which strictly adheres to the position of integrating the countries of the region into the global transport system as a single whole, will continue proactive transport diplomacy, which will allow synchronizing the national projects of the states of the region with the international transport corridors East-West and North-South.

To do this, it is necessary to pursue a policy of convergence of the transport and communication systems of neighboring countries, which is mentioned in the draft conceptual document entitled “Strategy for the Development of the Transport System of the Republic of Uzbekistan until 2035”.

Jasur Rakhmatov,

Head of the Department, ISRS under the President of the Republic of Uzbekistan