Iran ready to approve 2017 rail budget

06 February 2017

Current five-year plan supports transition to transit-driven economy

Iran’s parliament is expected to approve a $462m budget allocation for the country’s planned and ongoing rail upgrade projects in the next fiscal year which starts in March.

Of the total budget, $117m is allocated for land rights and equipment procurement while the rest is allocated for participation bonds, according to local news agency Irna citing Jabbar Ali Zakeri, a board member of Iran’s Construction and Development of Transportation Infrastructure Company.

The budget is equivalent to roughly 1 per cent of Iran’s annual oil revenues. The annual budget allocation for the rail sector is part of a bill that is understood to have been previously approved by members of the parliament.

It aims to support the country’s long-term strategy to move away from hydrocarbons and towards “a transit-driven economy.”

This budget will support laying several thousand of tracks, most of which are intended to dualise existing single mainline rail tracks.

Iran is understood to have laid an average of 200km of tracks annually in recent years.

Iran’s long list of under-construction rail projects includes the line that links Qazvin to Rasht near the border with Azerbaijan.

It also includes the 440km Gharb West rail project, which aims to connect the city of Arak in central Markazi Province to the Khosravi Border Crossing is Kermanshah Province, which borders Iraq.

Two routes, one from Garmsar and Incheh Borun and another that extends between Tehran and Mashhad are also being electrified. The latter contract has been awarded to Germany’s Siemens, with the German development bank KfW Import-Export Bank (Ipex) likely to provide funding for the project.

Proposed projects for double tracking or upgrade


Length (km)

Qazvin - Rasht*


Tehran - Isfahan high-speed line


Mianeh – Tabriz


Tehran - Hadean – Sanandaj


Shiraz – Bushehr


Gorgan - Bojnourd – Mashhad


Mianeh – Ardabil


Gharb (West) Rail: Arak (Markazi) - Khosravi Border Crossing (Kermanshah**)




Apart from the double-tracking and electrification projects, there are plans to lay 1,500km of new rail tracks under the country’s sixth Five-Year Development Plan, which extends from 2016 to 2021. Similarly to the 2017 budget, the plan is yet to be approved by Iran’s parliament.

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