Kazakhstan is expanding its rail routes due to the war in Iran

Kazakhstan’s national railway operator is expanding its transport infrastructure amid changes in trade routes caused by the war in Iran. The country is seeking to meet the growing demand for freight transport between China and Europe, as companies look for alternative logistics routes due to the unstable situation in the region.

Bloomberg reports on this.

The situation around the Strait of Hormuz and the escalation in the Middle East are leading to increased volumes. "Customers from China have become more interested in land transport rather than sea transport due to reliability and predictable delivery times," explained Talgat Aldibergenov, CEO of Kazakhstan Temir Zholy.

This shift in trade traffic underscores the growing importance of the so-called Middle Corridor of the Trans-Caspian railway route, which connects China and Europe.

The railway line, stretching over 4,250 kilometers, passes through several countries, including Azerbaijan, Georgia, and Turkey, with the largest portion running through Kazakhstan.

"The importance of this route in global freight transport has already grown since the Kremlin sent troops into Ukraine in 2022, prompting many to avoid rail links passing through Russia," the publication states.

According to data from UK-based Abrdn Investments Ltd, freight volumes along the Middle Corridor have increased approximately tenfold since then.

Kazakhstan has made transport logistics a strategic priority, transforming the national railway into a key transit operator. According to Aldibergenov, KTZ’s total investment in infrastructure development is expected to reach $10 billion by 2030, of which about half has already been spent.

Kazakhstan Temir Zholy is building 900 kilometers of railway lines this year, including a new 300-kilometer route from Ayagoz to Bakhti in China, which will create a third railway border crossing with its eastern neighbor.

Once the projects are completed, rail capacity between Kazakhstan and China is projected to reach 100 million tons by 2030, up from the current 55 million tons.

Expansion along the Middle Corridor is also accelerating rapidly. In the first quarter, the route handled about 173 trains, each carrying 55 containers with various types of cargo. The target for the entire year is 600 trains, and this figure could rise by 67% next year, the publication states.