Uzbek Railways awarded new Afghan operations and maintenance contract

Last year the Afghanistan Railway Authority invited expressions of interest in contracts to operate and maintain the 75 km railway from Hairatan to Mazar-i-Sharif.

On 15 March 20151 Afghanistan’s Ministry of Public Works awarded Uzbek national railway UTY a new contract to operate and maintain the line.2

This contract replaces the original 2011 operating contract, which was worth worth $32m/year. On 8 February 2011 UTY established its Sogdiana Trans subsidiary to undertake operations and maintenance in Afghanistan.3

The latest contract runs for three years and will see UTY paid $19m/year to manage the line. UTY will pay taxes, and is to provide training for 50 Afghans each year. Until now the railway has only been used for imports, but the new contract should see the line used to carry a total of at least four million tonnes of Afghan goods for export.

Government railways department to be formed

According to the 17 October 2011 Ministry of Mines statement which said MCC is to commission a Chinese firm to undertake surveys for railways from Kabul to Torkham and the Hayratan line, Minister of Mines Wahidullah Shahrani “stressed that the creations of most of railways are related to mining projects therefore for the time being all of railways projects will be related to the Ministry of Mines“.1

However, on 19 October 2011 a US$222m grant agreement was signed in Kabul by Finance Minister Hazrat Omar Zakhilwal and the Asian Development Bank’s Country Director Robert Rinker.2 The Minister of Finance said $189m of this was for road projects, according to a news report, while the rest would be used “to establish an independent railways department”. This will be “within the framework of the Ministry of Public Works, which will supervise the construction of rail tracks.”3

The Deputy Public Works Minister, Eng Ahmad Shah Waheed, said a commission led by the presidential advisor on economics affairs and comprising representatives from the ministries of Public Works, Finance, Economy and Commerce has been set up “to evolve a mechanism for the railways department”.

So is there a risk of a turf war between the ministries of Mines and Public Works? I’ve been led to believe that the Minister of Mines is a powerful figure, as mining rights could potentially generate significant income for a country which lacks many source of revenue.

  1. Technical research for Kabul-Mazir and Kabul-Torkham railways begins soon, Ministry of Mines, dated 17 October 2011, published 18 October 2011
  2. ADB Provides $US 222 Million for Roads Construction in Afghanistan, Ministry of Finance, 19 October 2011
  3. ADB to give $222mn for roads, rail tracks to Afghanistan, News Network International, 20 October 2011