Bureaucracy may impede Baghdad's rail plans

05 December 2011

Years of neglect, lack of commitment and corruption allegations may hinder Baghdad’s rail schemes

Baghdad began using rail transport almost 100 years ago. The first train was operated between Baghdad and Dijeyl, and between 1978 and 1987, a high-speed rail line was constructed between Baghdad and Akashat.

But Iraq has lost its early-mover advantage. Many years of neglect and conflict-ridden damage have resulted in its rail sector being left behind. Iraq Republic Railways (IRR), an arm of Iraq’s Transport Ministry, wants to change this. However, it has made very little progress in recent years. Plans that were drawn up in the 1980s were shelved indefinitely and need to be revised before the projects move ahead.

It is unlikely that Iraq will move forward with its plans in the short term. The IRR has been in discussions with France’s Alstom for over a year and is no closer to signing agreements.

In the long term, private-sector investment will be essential for the rail programme to move ahead. IRR hopes to develop the network using contracts with private firms that will procure, construct and finance the lines. The companies will be paid under a deferred payment structure. Such a scheme raises questions about the government’s commitment to the projects as it would not be taking an equity position in the schemes.

The decision to award the deals by direct negotiations with developers instead of open tenders also exposes IRR to claims of corruption. All of this means that the rail projects are unlikely to happen for several decades.

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