The North-South Corridor THE NEW CAUCASUS ROUTE

The North-South Corridor THE NEW CAUCASUS ROUTE

The World-wide organization for co-operation among Railways Mission: At World level UIC shall promote rail transport in order to meet challenges of Mobility and Sustainable development 1 Know How, technical and operational expertise Technical solutions Regulations, standards, best practises Provider Facilitator 3 Exchange platforms, Innovation: new ideas, new concepts Protecting member Support policies of development of key infrastructure projects 2 Specifications Standards Interfaces Studies Interoperability for international rail corridors Developer Organiser 4 Forums Platforms Study groups International conferences congresses

UIC a global association with almost 200 members around the world Members: 82 Active 82 Associate 35 Affiliate

6-7 July 2010 Preliminary Program World class logistics Intermodal solutions Intercontinental rail links Paperless transport Economic trends and logistics Sustainable logistics Technological innovations Reshaping wagonload

Project background The initial founders of The International North-South Transport Corridor (INSTC) were India, Russia and Iran (2000). Later on several other countries have joined the corridor project UNESCAP presented a study (2001) where the North-South Corridor was shown as an integrated part of the overall TAR - network. The main routes were defined as follows: 1: The Caucasus Route (west) 2: The Central Asian Route (east) 3: The Caspian Sea Route (through) Several organizations have worked with showed interest in the North-South concept or

Preface Executive summary Feasibility study 3.10.2008 Background and objectives The International transportation corridor development concept, logistical The North-South idea & status Corridor Macro The conditions New Caucasus Route and politics The selected route Infrastructure, technical and operational feasibility The market THE INTERNATIONAL UNION OF RAILWAYS Competition Feasibility study Financial & commercial viability Discussions and evaluation Recommendations & progress 3. October 2008 UIC s objective was to prepare a feasibility study.highlighting some of the required conditions for future operation on a particular route along the North-South Corridor

The selected route: criteria The most viable route on longer term As few countries as possible (easier agreements and border crossings) The route has as few discontinues points (gauge break, trans-loadings etc) as possible The distance is as short as possible Focus on the railways, i.e. we use trains where it is possible or railway sections can be developed There are alternatives (back-up) routes/sections if the main section fails (like sea transport over the Caspian Sea and railways transport through Azerbaijan) The route is recommended by organizations like the UN and railway organizations like RZD, RAI, IR and others)

Murmansk MOSCOW St.P. BELARUS UKRAINE NORTH-SOUTH CORRIDOR THE NEW CAUCASUS ROUTE RUSSIA KAZAKHSTAN LEGENDS: 1520 m.m. 1435 m.m. 1435 m.m. (project) 1667 m.m. Sea connection Main corridor indication The new link Bam- Zahedan The new link Astara- Quazwin TURKEY Bandar Abbas Teheran PAKISTAN New Delhi The new link Bam- Chabahar Mumbai Transportutvikling AS, 2008

Scandinavia Murmansk NW Russia MAIN HUB-STRUCTURE THE NEW CAUCASUS ROUTE LEGENDS: Potential HuB s Main railway Hub-structures St.Petersb. Baltic & Europe MOSCOW Central Russia Main sea connection Back-up route through the Caspian Sea Requirements: Well developed distribution network Market conditions Turkey & Europe The link Astara- Quazwin (NOT COMPLETED) Astara Iran & Iraq Olya Anzali Various sea connections Teheran Central Asia Future main route or back-up route through Pakistan (Bam-Zahedan) (NOT COMPLETED) Pakistan Well developed logistical and organizational systems BANDAR ABBAS & CHABAHAR (RAIL LINK TO CHABAHAR NOT COMPLETED) Gulf countries MUMBAI India Source: Transportutvikling AS, 2008 Asia

To Russia, Europe, Turkey etc Qazwin-Astara (335 km) Most important project Astara LEGENDS: 170 km New railway connection Existing tracks: Distance (km) 165 km St.P. Murmansk MOSCOW NORTH-SOUTH CORRIDOR THE NEW CAUCASUS ROUTE RUSSIA LEGENDS: 1520 m.m. 1435 m.m. 1435 m.m. (project) 1667 m.m. Sea connection Main corridor indication Rasht-Astara (ongoing study) 40 km Anzali Rasht BELARUS UKRAINE KAZAKHSTAN The new link Bam-Zahedan To Turkey, Armenia etc 165 km Qazwin-Rasht-Anzali (under construction) TURKEY The new link Astara-Quazwin Teheran Quazwin Bandar Abbas PAKISTAN New Delhi Source: Transportutvikling AS, 2008 To Teheran and Bandar Abbas The new link Bam-Chabahar Mumbai Transportutvikling AS, 2008

Infrastructure and operational feasibility 1 700 1 650 The North-South Corridor - The New Caucasus Route 1 667 1 600 Railway gauge 1 550 1 500 1 524 Border Border 1 520 1 520 crossing crossing Border crossing Border crossing 1 450 Gauge break 1 435 1 400 1 350 ( ) 1 300 Finland Russia Caspian Sea (optional) Azerbaijan Iran Persian Gulf/Indian Sea India Ocean terminal operation (Russia) Ocean terminal operation (Iran) Ocean terminal operation (Iran) Ocean terminal operation (India Source: Transportutvikling AS-2008 In practical terms; we will face only one railway gauge break for the North- South Corridor and the New Caucasus Route (Azerbaijan/Iran). This is favorable, compared with many other railway corridors along the Europe-Asia axis.

North-South legal issues CIM CIM / SMGS SMGS

Distance comparison 18 000 90 % Comparisson transport distances 16 000 Present route New Caucasus 78 % 80 % In favour of North-South (%) 14 000 70 % Km 12 000 10 000 8 000 6 000 47 % 54 % 55 % 60 % 50 % 40 % 30 % In favour of North-South (%) 4 000 22 % 20 % 2 000 10 % 0 Mumbai-Rotterdam Mumbai-St.Petersburg Mumbai-Moscow Teheran-Rotterdam Teheran-Moscow 0 %

Commercial viability freight rate The present price level is probably a challenge. The challenge is related to both the railway section and the ocean leg Compared with the existing alternative and a portto-port transport, the North-South corridor has to improve to be competitive. We believe improvements are possible When the origin/destination is located to the inland regions of Europe, and close to the corridor s main lane, the North-South corridor is more competitive

Progress The progress proposals is based on a long term perspective, - well knowing that the railway infrastructure is currently missing between Azerbaijan and Iran

Progress initial work Establish a closer and more formalized project interaction between UIC and the railways, particularly connected to the work which has been ongoing in RZD (feasibility study). Important elements to focus on are: Verifying and updating information in general A more detailed service/product description (QA, transit times, rates, capacity, terminal functions, border crossings etc.) Verifying a viable product is usually to be done before any major investments. A more detailed market analysis Logistical development in general along the corridor Securing political accepts and financial support

Progress - continuation Take steps to establish a committed company for the corridor development, including: Establish a professional board Prepare a business plan, including a time schedule, for a demonstration run Prepare and conduct the demonstration run when the missing link Iran-Azerbaijan is completed UIC Global Team of Experts meeting will be held in Paris December 16-17 2009 Railway undertakings which are affiliated to the corridor are welcome to participate. Invitations will be sent out next week.