After stops and starts, GCC rail is back on 2030 timetable

December 5, 2023, 10:16 AM

Although Kuwait and Dubai have taken different routes with their metro plans, the GCC is pushing ahead with rail links between member cities — Although Kuwait and Dubai are on different tracks with their metro plans, member states are pushing ahead with GCC rail links

GCC has agreed 2030 target
Kuwait cancels metro project
India corridor to shape plan

In the same week that Dubai announced a 30km extension of its metro network, Kuwait revealed that its $20 billion four-line metro project is to be cancelled.

If anything sums up the difficulties associated with connecting the GCC countries by rail, then it is this.

Kuwait’s metro hit the buffers as a result of “significant administrative and financial burdens on public funds”, which amounted to KD2 billion ($6.48 billion), according to the state Audit Bureau.

“Kuwait continues to suffer from chronic political gridlock as its restive parliament clashes with the government, constraining project implementation and deterring foreign investment,” says the Economist Intelligence Unit.

Despite such difficulties, the six GCC members have been talking about an international rail network since at least 2004. Completion was originally scheduled for 2018, but the project suffered a setback when global oil prices plunged in 2014.

The plans were jump-started two years ago when the six members met at Al Ula in Saudi Arabia and established the Gulf Railways Authority.

In June this year, Ed James, head of content and analysis at Meed, predicted that Gulf governments were preparing to hand out contracts worth $167 billion for a GCC rail network.

“We should expect to see some significant contracts awarded on the railway to link all the GCC states over the next 24 to 26 months,” he said.

Rail delivery still relies on energy prices

James Swanston, Middle East economist with Capital Economics, says the timeline for delivery of this network will remain heavily dependent on energy prices. Railways compete with other huge infrastructure projects across the region that are reliant on petrodollars.

“The resumption of works in the past year or so isn’t surprising given the oil windfall the Gulf states have received,” Swanston says.

Economies in the Gulf are to receive as much as $1.4 trillion in additional revenue over the next four to five years as a result of high oil prices and low inflation, according to the International Monetary Fund. But fluctuations in oil prices may lead to project delays or even cancellations.

The exception is the UAE. Etihad Rail has been transporting freight since 2016 and is expected to carry over 60 million tonnes of materials and 36.5 million passengers by 2030.

After a bilateral meeting in October last year, the UAE and Oman have also progressed in a $3 billion project to connect Sohar Port in northern Oman to Al Ain and Abu Dhabi.

The rest of the region is some way behind.

Last month the committee of GCC transport ministers agreed at a meeting in Muscat that a 2,117km route connecting major cities in each of the six member states would be operational by 2030.

“From a design and build perspective, rail developments in the UAE have proven that the engineering capabilities are there and that the vision for rail can reach fruition,” says Dan Irish, associate director, roads and highways, at engineer WSP Middle East.

Qatar-Saudi connection

In January 2022, Qatar and Saudi Arabia agreed to resume work on a rail connection after political ructions had delayed that project. Saudi Arabia Railways and the Saudi Public Transport Authority also appointed Systra of France to undertake a feasibility study into a high-speed rail link between the kingdom and Kuwait, according to reports earlier this year.

Demand for rail exists in Saudi Arabia. A line between Riyadh and Dammam in the eastern province opened in 1981 but plans to link the capital to Jeddah and other cities on the Red Sea coast have been neglected. Now, according to figures from Saudi Arabia Railways, the number of passengers travelling by rail reached 2.28 million during the third quarter of 2023.

This is the largest number recorded since the rail operator was established and a 45 percent increase compared to the same period last year.

Demand for rail travel is rising. In Saudi Arabia, passenger numbers reached 2.28 million in Q3

Systra was also chosen to conduct a feasibility study into a high-speed link between Riyadh and Doha.

Work to restart the $4 billion Qatar-Bahrain causeway, another victim of political friction, was announced in March 2022 and should help expedite the proposed network between the two countries.

India adds incentive

In the longer term, regional rail development is likely to be spurred by the India-Middle East-Europe Economic Corridor (Imec), which was announced at a G20 summit in New Delhi.

Imec aims to integrate railway routes and link ports along a route from India to Europe, through the UAE, Saudi Arabia, Jordan and Israel.

Such a scheme would mean a low-carbon – or at least lower-carbon – profile for the GCC states, which are among some of the highest emitters of greenhouse gases in the world. Transport is a big contributor to the problem and rail may be part of the answer.

WSP’s Irish says: “In addition to improved connectivity and providing low-carbon alternatives to air travel and combustion vehicles, rail will help nearby development, increase tourism value and stimulate economic growth and activities which attract investment and trade opportunities to areas where stations are located.”