Logistics

UAE-Oman rail link to bring cross-border economic boost

February 22, 2023

The Board of Directors of the joint venture between Oman Rail, the Sultanate’s national developer and operator of railway networks, and Etihad Rail, the developer and operator of the UAE National Rail Network, held its inaugural meeting — The board of directors of the joint venture between Oman Rail and Etihad Rail at their inaugural meeting in October

Passenger trains will run up to 200km per hour
Trade between neighbours hit $10.8bn in first nine months of 2022
Etihad Rail track on UAE side to carry 60m tonnes of freight by 2030

A $3 billion investment to extend the railway network from the UAE into Oman is expected to bring economic benefits for businesses on both sides of the border.

Oman and Etihad Rail Company, the developer and operator of the UAE-Oman Rail Network, has signed a deal with Abu Dhabi’s Mubadala Investment Company to support the development of the 303km network across the two Gulf countries.

Ahmed Al Musawa Al Hashemi, CEO of Oman and Etihad Rail Company, said the rail network between Oman and UAE was of strategic importance.

“It is a valuable addition to the logistics service sector in both countries, and contributes to increasing their competitiveness in the market by reducing the total cost of the supply chain,” he said.

Passenger trains will run up to 200 km per hour, reducing the time of the journey between Sohar and Abu Dhabi to 100 minutes – a drive which currently takes almost three hours.

The volume of trade between the UAE and Oman hit around OR4.19 billion ($10.88 billion) through the first nine months of 2022 as the sultanate remained one of the UAE’s top global non-oil trade partners.

Scott Livermore, chief economist at Oxford Economics Middle East, said: “Clearly closer integration is beneficial for expanding markets and connectivity for both countries. It will aid diversification objectives and offer economic benefits to businesses in both countries.”

The latest agreement includes forming working groups and joint committee and developing economic and financial feasibility studies.

Suhail bin Mohammed Faraj Faris Al Mazrouei, minister of energy and infrastructure and chairman of Oman and Etihad Rail Company, said: “The joint venture will transform the infrastructure, transport and logistics sectors, and enhance commercial movement and social cohesion.”

The 1,200km Etihad Rail track on the UAE side is expected to carry over 60 million tonnes of freight and 36.5 million passengers by 2030.

It will extend across the UAE from the border with Saudi Arabia at Ghuweifat, connecting the Emirates via Abu Dhabi, Kizad, Khalifa Port, Jebel Ali Port, Dubai, Sharjah, Ras Al Khaimah and to Fujairah on the country’s east coast.