Building Afghanistan's New Railway as Lifesaving Link | Asian Development Bank

Building Afghanistan's New Railway as Lifesaving Link

Project Result / Case Study | 6 May 2014

ADB has helped open up Afghanistan to increased trade and commerce through the construction of a new rail system.

For Afghanistan, the country's first railroad has resulted in a steady supply of lifesaving goods and a vital link to Uzbekistan, its vibrant neighbor.

For Jan Mohammad, the impact has been much more personal. It has given him a job that has changed the lives of his five children.

"My income has made their education possible," Jan says.

Jan works at the railway station in the town of Naibabad, along the northern Afghanistan border, unloading freight. He can earn over $300 a month working for the rail company—more than triple what he once earned as a day laborer.

The extra money is putting his three sons and two daughters through school.

Jan is one of millions of people in Afghanistan whose lives have been changed by the railroad.

It is the first rail line in Afghanistan's history and runs 75 kilometers from the city of Mazar-e-Sharif to Hairatan, a town on the country's northern border with Uzbekistan. Built with a $165 million grant from ADB, the project has helped open the war-torn country to increased trade and commerce.

"Afghanistan has the potential to be a regional crossroads, as it was when trade flourished along the routes of the ancient Silk Road," says Balabhaskara Reddy Bathula, a transport specialist in ADB. "The rail system is the first step in bringing the country closer to sharing in the prosperity of its neighbors."

Afghanistan is home to a spectacular rugged landscape that has captured the imagination of visitors since the Venetian explorer Marco Polo traversed its mountains in the 13th century.

Unfortunately for the people of Afghanistan, who need goods from the outside world and markets to sell their products, the rough mountain passes in many parts of the country have not changed for centuries.

The landlocked country has faced a critical shortage of roads. Aside from a lack of highways needed to move goods and people effectively inside the country, its few crossborder road links have been crowded with traffic.

The materials required to rebuild the post-conflict nation, deliver basic services, and reduce widespread suffering in one of the world's poorest countries were not getting to the people who needed it. The few supplies that arrived came at an agonizingly slow pace.

In addition, security problems in the country made international land routes to and from the south and east unsafe and unreliable. The safer northern road to the Uzbekistan border had in recent years become a colossal bottleneck of traffic as the country's supplies squeezed through that single overburdened border crossing.

Afghanistan did not need a trickle of goods flowing back and forth across the border. It needed a flood of humanitarian aid, commercial goods, and materials to help rebuild the count ry's infrastructure. After more than 3 decades of conflict, the country had to be rebuilt on the back of a small, rough border highway.

Beyond simply bringing the country out of desperation, Afghanistan needed the means to grow its economy. It is surrounded by neighbors whose people are enjoying better lives than their forebears, due in part to trade with the dynamic nations of Central and South Asia, and the rest of the world.

Because of its location, Afghanistan has been poised to join in this economic boom. However, the security situation prevented the country from developing the roads, railways, and airports that would link it to its thriving neighbors. Its doors had not truly been open to the life-changing impact of regional and global trade.

A practical solution

The Government of Afghanistan and ADB devised a solution to move goods efficiently through this safe northern passage. The plan was to rehabilitate an outdated 15-kilometer cross-border railway extension from the town of Termez in Uzbekistan and extend the link to the main northern city of Mazar-e-Sharif and the country's main road network about 75 kilometers away. The old railway terminated at the Afghanistan border town of Hairatan. Here, cargo was off-loaded and reloaded onto trucks, which passed through a congested highway for distribution across the country.

In December 2011, 2 years after the project broke ground, the Hairatan to Mazar-e-Sharif railway was operational. Goods could be transported in trucks along Afghanistan's main road system from Mazar-e-Sharif in Balkh Province, about 300 kilometers north of the capital city of Kabul, and then shipped efficiently by rail into Uzbekistan and further to Central Asia and Europe. Vital relief goods and other materials could flow in from the other direction as well.

Esmatullah, a store manager at a port in Hairatan, has seen his business flourish since the rail line opened.

"We have about 50 or 60 wagons loaded and unloaded in Naibabad at night," he says. "Some workers are busy there and they are from different provinces. We do not have employees and workers only from the north, we have employees who come from the south, east, and west of Afghanistan working together as a whole."

The moving of goods along the rail line, rather than on highways fraught with security and other problems, has increased trade around the country.

"Another benefit this railway provided to our businessmen is the timely and easy loading and unloading of their goods and supplies," says Esmatullah. "They can load and unload their goods whether in Balkh Airport, Naibabad, or Hairatan. They can also carry out their trades without any fear of delays and fines."

Now they can go to school

More than 7 million people have benefited from the new railway through jobs and increased trade. This has included freight operators, traders, businesses, and local communities served by the railway.

"Afghanistan has the potential to be a regional crossroads, as it was when trade flourished along the routes of the ancient Silk Road."

Balabhaskara Reddy Bathula, transport specialist in ADB

Having an efficient, safe, and reliable railway transport network operating in northern Afghanistan has resulted in people getting jobs in areas where opportunities were very limited. Employment in the project area has shown an overall growth of over 10% per year since 2010. About 1,200 people are currently employed in logistics and unloading operations, while more jobs are expected to emerge in logistics services at railroad stations.

Ghulam Yahya Darwesh, a general manager at the port in Naibabad, said business has picked up in provinces throughout northern Afghanistan since the opening of the new rail link.

"About 100 workers and employees are hired here and earn a living," he says. "We also have 300 laborers loading and unloading up to 60,000 tons of freight a month."

"The railway has brought positive economic effects since it was built," he says. "The shipping gets done in an appropriate way for businessmen. They can load and send their goods and supplies easily and they are delivered in a timely manner."

The benefits are spreading throughout Afghanistan as the railway promotes economic growth, as well as regional trade and cooperation. The lower transport costs have reduced the price of goods and have resulted in higher quality goods coming into the country.

In addition to making it easier to deliver humanitarian relief to hard-hit areas and bringing goods to various parts of the country, the project is also helping the country develop its natural resources.

"Afghanistan can also benefit, for the first time in history, from exploration and development of its mineral resources, which have been valued at trillions of dollars," says Wahidullah Shahrani, Afghanistan's Minister of Mines.

The project constructed new stations between Hairatan and Mazar-e-Sharif and installed modern signal and telecommunications systems for safe and efficient operation.

By 2012, freight transported by train had reached about 6,500 tons per day, and the volume of vehicle traffic on the old, overburdened road had decreased. The freight travel time from Hairatan to Mazar-e-Sharif had been cut from 2 hours by road to 1 hour by rail, while carbon dioxide emissions from heavy vehicles had dropped from 2.3 million tons to 1.7 million tons per year.

As goods move efficiently back and forth across the border, businesses are enjoying the benefits. Local companies registered growth of about 15%–65% between 2009 and 2012 in Balkh Province. The value of trade between Afghanistan and Uzbekistan reached $732 million in 2011 and 2012, up from $170 million in 2008. The value of Afghanistan's total trade was $6.8 billion during the same period, an increase from $3.5 billion in 2008.

Normally, 5 years are needed for such an undertaking. To make such an impact in a record time of 2 years in a challenging environment, ADB had to use various innovative methods. These included using an operation and maintenance contract that rewarded the Uzbekistan railway company for performing the work efficiently. This led to a strong service record and lower freight transport costs by the railway.

In addition, it included taking advance actions before the project was approved, a contract that offered a bonus for early completion, and ADB's close monitoring and coordination with the government.

The success of the rail system has paved the way for a national railway development plan, which is being developed with ADB's help. The future railway system, expected to be developed by 2025 and covering 4,425 kilometers, will link the country's major population centers. It is also expected to help make the country a strategic north–south trade corridor between Central and South Asia and, through further links, to the sea.

For Sharif, a 46-year-old father of four who works as a freight forwarder at the Naibabad station, the $340 he earns each month is having a huge impact. It does not only change his life, it also helps address one of Afghanistan's most critical issues—the empowerment of women and girls.

"In the past, I couldn't afford to enroll my daughters in school because I didn't have a regular job," Sharif says. "Now they can go to school."

This article was originally published in Together We Deliver, a publication highlighting successful ADB projects across Asia and the Pacific that demonstrated development impacts, best practice, and innovation.