Iran cuts rail fright tariffs to benefit India-Russia route

News ID: 4089187 -
TEHRAN, Sep. 17 (MNA) – A senior official in Islamic Republic of Iran Railways said Iran has reduced tariffs for goods transportation by 50% in order to increase attraction of cargo to INSTC-Express Corridor from India to Russia.

The Iranian Railroad Company's Director General for International Affairs Abbas Nazari made the remarks while addressing a conference on International North–South Transport Corridor (INSTC) held on Saturday in India.

“It is clear to all that the north-south corridor, with agreement of Iran, India and Russia, was defined 17 years ago while goods and commodities are presently being transported to Europe via the Suez Canal,” noted the official explaining “indeed, due to ongoing problems in Yemen, insurance costs for goods transport has increased on the rail route.”

He said Astara route has been completed in Azerbaijan’s soil adding “Astara bridge has been constructed on Astarachay river connecting the two countries as well as that the Astara route in Iran’s soil will soon come on stream.”

Nazari said Qazvin-Rasht route with a length of 163km was 96% through with the remaining part being finished in the next three months. He later underline that one billion dollars were required to construct Astara-Rasht railroad.

The official stated that several meetings had been held with Azerbaijani and Russian railway authorities leading to a number of documents and memorandums in a bid to operate the corridor in the form of mixed transport from Bombay to Moscow.

Referring to the 22-day trip of the first Bombay-Moscow test train, Abbas Nazari emphasized that “to attract freight, tariffs for the route have been decreased by 50% for 2017 and a 5-way Memorandum of Understanding has been recently inked between Iran, Azerbaijan, Russia, Ukraine and Poland for transportation on the route.”

The official, while emphasizing the need for unified management of the corridor for its operation and then economization, said it was necessary to clearly specify volume and amount of cargo along the corridor, type of goods, origin and destination, and all relevant information.”

The International North–South Transport Corridor (INSTC) is a 7,200-km-long multi-mode network of ship, rail, and road route for moving freight between India, Russia, Iran, Europe and Central Asia. The route primarily involves moving freight from India, Iran, Azerbaijan and Russia via ship, rail and road.

The objective of the corridor is to increase trade connectivity between major cities such as Mumbai, Moscow, Tehran, Baku, Bandar Abbas, Astrakhan, Bandar Anzali, etc. Dry runs of two routes were conducted in 2014, the first was Mumbai to Baku via Bandar Abbas and the second was Mumbai to Astrakhan via Bandar Abbas, Tehran and Bandar Anzali. The objective of the study was to identify and address key bottlenecks. The results showed transport costs were reduced by $2,500 per 15 tons of cargo.

HA/4088722

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