Iran eyeing options for rail, road plans

Iran announced on Wednesday that it has devised various mechanisms to attract investments for projects to revamp its transportation infrastructure.

Abbas Akhundi, Iran’s minister of roads and urban development, said the government of President Hassan Rouhani plans to draw foreign investments for road construction projects through the Build-Operate-Transfer (BOT) and Build-Operate-Lease (BOL) schemes.

Akhundi said both schemes envisage compensating investors through road tolls before delivering the projects to the Iranian government.

He added that the government plans to press ahead the development of Iran’s rail networks through the BOL scheme based on which the networks are leased from investors after development.

Akhundi, who was speaking at a meeting with Iran’s ambassadors, said a second option for Iran is to encourage foreign investors to form joint companies with their Iranian counterparts to construct rail networks through the BOT scheme.

He further emphasized that the government is short of the required funds to purchase planes.

Akhundi said that Iran would need to buy at least 500 commercial aircraft of various models at a cost of above $50 billion.

The government does not have the required funds to make such a huge purchase, he said. “This is the reason why it has decided to provide the planes through leasing,” he added.

Akhundi further emphasized that Iran has held talks with several plane manufacturers, adding that a number of planes will be purchased through leasing next year.