Rail Freight Transport Rises 12% in Eight Months, Boosting Exports to Afghanistan

TEHRAN (Iran News) Speaking on Monday at a ceremony marking the signing of a memorandum of understanding (MoU) on the development of rail transportation with the Middle East Mines and Mineral Industries Development Holding Company (MIDHCO or MIDCO), Jabarali Zakari said the expansion of rail transport would significantly reduce steel production costs while also lowering social costs such as air pollution and improving road safety.

Zakari, who also serves as Deputy Minister of Roads and Urban Development, referred to MIDCO’s prominent position in Iran’s steel industry and its annual transportation of around 30 million tons of cargo. He noted that for the first time this year, exports of sponge iron to Uzbekistan were carried out via rail in coordination with the Trade Promotion Organization of Iran. In addition, arrangements have been made to facilitate the movement of Iranian rail wagons along routes passing through Turkmenistan and Uzbekistan.

He further announced that a new gateway for exports to Afghanistan has been opened. “Since the beginning of this year, around 450,000 tons of various products have been exported or transited to Afghanistan through the Shamtiq border,” Zakari said, adding that the target for cargo transportation to Afghanistan next year exceeds 1.5 million tons.

According to Zakari, rail freight shipments to Afghanistan have reached 70,000 tons in the current month and are expected to surpass 100,000 tons next month. He explained that goods transported via rail to Afghanistan include ceramic products from Yazd, steel products from various companies, as well as petroleum products transited from the United Arab Emirates, Kuwait, and Russia. He emphasized that this new eastern export corridor could play a significant role in strengthening Iran’s export capacity.

Highlighting the economic benefits of rail transport, Zakari noted that the cost of petroleum products inside Afghanistan stands at around $1,400 per ton when transported by conventional means. “With rail transport, this figure has now dropped to $935 per ton, which clearly demonstrates the effectiveness and cost-efficiency of rail-based logistics,” he said.

Zakari also pointed to the target set under Iran’s Seventh National Development Plan to increase rail’s share of cargo transportation to 30 percent. He confirmed that during the first eight months of the current year, rail freight tonnage grew by 12 percent compared to the same period last year.

In another development, Zakari announced that regulations for operating “full trains” have been drafted as part of the requirements of the Seventh Development Plan. He said the guidelines were prepared with the cooperation of the private sector and that pilot operations of full trains are expected to begin soon.

He explained that the initiative aims to reduce overall transportation costs, increase the volume of cargo handled by rail freight companies, and boost their revenues.

Zakari also revealed plans to double-track the Sangan–Bafq rail corridor through public-private partnership. He said preliminary agreements have been reached and expressed hope that a formal MoU, with private sector participation estimated at 50 to 60 percent, would be signed in the near future.

Currently, about 15 million tons of cargo are transported annually from Sangan to central Iran by rail and road. Zakari noted that this figure is projected to rise to 22 million tons under the Seventh Development Plan, making the construction of a second rail line on this route essential.

In closing, he described the rationalization of fuel pricing as a key factor in promoting rail transport development across the country.

At the same event, MIDCO CEO Alireza Ebrahimi described the company as one of Iran’s largest private-sector enterprises active in steel production. He said that over the past 17 years, MIDCO has invested approximately $7 billion in mining, steel, and copper production projects.