Iran’s rail industry gets a fresh boost from China’s dedication of $845 million to build a train line connecting Tehran to the western cities of Hamadan and Sanandaj.
A Wednesday report said China National Machinery Industry Corp, known as Sinomach, signed a contract worth 5.35 billion yuan with Iran which is on a railway modernization and expansion drive.
Sinomach will handle the engineering, procurement and construction work for the 410 km (255 mile) railway, the company said on its website.
Sanandaj is one of the few remaining provincial capitals in a file in Iran to link with the national railway network.
On Tuesday, President Hassan Rouhani opened a new train line which connected Kermanshah in western Iran with the national railway grid. Officials said the cities of Rasht and Urmia are next to join the network in the coming months, before Ardabil, Sanandaj and Bushehr round up the plan.
China Railway Construction in January said one of its units had won a 3.53 billion yuan contract to build the extension of the Kermanshah railway to Khosravi on the Iraqi border.
Iran plans to become a transport hub in the heart of Eurasia where regional countries have drawn up their own development strategies.
On Sunday, Minister of Roads and Urban Development Abbas Akhundi said Iran needed $50 billion of investment for the modernization and expansion of its railway network in the next 10 years.
China’s flurry of investments in Iran is in line with the Asian giant’s “Belt and Road” initiative, a project aiming to build a modern-day “Silk Road” at a cost of $1 trillion.
Beijing’s biggest transportation project in Iran is worth $1.5 billion to electrify the rail line from Tehran to Mashhad for a length of 926 kilometers. The railway is part of the 3,200-kilometer New Silk Road which goes all the way to Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan and Urumqi in China.
Earlier this month, a Chinese company signed a deal with Iran’s Ministry of Roads and Urban Development to build railway between the cities of Shiraz and Bushehr in the country’s south with $700 million of investment.
China’s CRRC Nanjing Puzhen Rail Transport later signed a contract with Iran’s IDRO Group to supply 450 metro cars for the Iranian cities of Ahvaz, Tabriz and Shiraz.
Iran’s rail sector has become a magnet for rail engineering and rolling stock firms from all over the world.
A German consortium has pledged $3.5 billion for rail development projects in Iran, including a new signaling system for the Tehran-Tabriz railroad, new electric and diesel wagons, and high-speed connection lines.
Russia’s largest rail equipment manufacturer Transmashholding has signed a 2.5 billion euro deal with Iran to set up a joint venture to produce rolling stock. Russian Railways also signed $1 billion euro deal in 2015 to electrify and put up the signaling apparatus on a section of rail line between Garmsar and Gorgan.
Italy’s state rail company Ferrovie dello Stato has signed a $1.37 billion deal to build a high-speed railway between the Iranian cities of Qom and Arak.
France’s Alstom has signed onto a joint venture to set up a factory to construct 1,000 railroad cars in Iran. In 2015, the French architecture firm AREP committed to a $7 million project that would see them revitalize three Iranian railway stations.
Japan has signed deals with Iran to provide $10 billion in funding for railway related ventures, including two railroads to link together northern and southern Tehran.