China and kazakhstan. transport corridors of iran as factor in regional economic integration

The importance of transport in all its forms and of fast, inexpensive and reliable transportation of raw materials and manufactured goods has always been one of the pressing needs of life and the axiom of economy. In each historic period, people tackle this issue according to the circumstances. The historic Silk Road, which reflects the spirit of cooperation, rationality and courage of our ancestors, is a perfect example.

The main features of the contemporary world are the growth of the world economy and the emergence of new independent states. These newly independent states are dealing with the problems of establishment of state borders, application of national laws, and consolidation of sovereignty.

In this context, the issues of transportation and communication are the most relevant. The most advanced technologies enable states to choose the trade and economic partners around the world. Numerous bilateral, multilateral and international initiatives have been made in this respect. Many of them are relating to the development and implementation of large-scale transportation projects. The seriousness of the issue presupposes its joint consideration and joint actions. In other words, the current state shall not be thought as the only option particularly for Eurasia that is extensive and varied in terms of natural resources, rich from the economic point of view and substantial in terms of cash flow.

Undoubtedly, the Eurasian space is important in today's and tomorrow's world due to its reserves in energy and raw materials, large amounts of cap

ital invested, vast territory and natural conditions that has made it a center of production of strategic products such as cereals and cotton. The other important factor is the proximity to the largest economies in Asia and Europe. The emergence of new greater economies in the region seems very likely; the most probable candidate is Kazakhstan. These factors precondition efficient and reliable corridors for the transportation of goods and energy.

The analysis of the current state of the transport and transit networks in Eurasia shows that they are underdeveloped and underused due to a number of internal and external factors. I would like to deal with some of these factors in more details.

First, political considerations often prevail over the economic logic when deciding about the best way to deliver or transit goods and energy. Under the economic logic, such features as low cost, lightweight, safety and reliability are the most important for a good transit corridor. Second, very stringent requirements on the national level are one of the reasons for slowing down the traffic. Third, the lack of financial resources impedes the implementation of major projects. Fourth, security issues in some areas bordering Eurasia, particularly in Afghanistan, the Caucasus and, these days, Ukraine.

Indeed, when calculated, the economic losses resulting from these factors make the issue of transportation corridors very problematic. One may even conclude that because of all these Eurasia may continue lagging behind the growth and prosperity of the other economically developed regions. In this context, the necessity for diversifi cation of the routes of transportation of goods and energy is even more pressing.

In this regard, the construction of the Kazakhstan-Turkmenistan-Iran Railway is very timely. It will undoubtedly play a significant role in improving the economic social situation of the peoples of the three countries. The importance of this new corridor will increase as long as the role of Central Asia grows in terms of connection with the Middle East as the major importer of cereals.

The role of Iran for the future of the most significant corridor projects in the region is worth

special mentioning. The biggest deference Iran can make arises from the two fundamentals features of transport economics: it is the shortest and safest route and its cost is low due to the geographic advantages.

Iran, because of its access to the international high seas in the south and its geographical location between Asia and Europe, has become a bridge between the two continents. The geographical location, long coastline, ports in the North and South of the country, safety of its rail and road networks, richness in terms of energy resources, all these promote the role of Iran within the system of the international transit corridors. Iran actively participates and plays a significant role in the North-South and

TRACECA projects as well as in a number of international and regional organizations.

Iran has two dozens of roads and five rail ways crossing the border as well as a dozen large trading ports and a considerable number of smaller ports. All these serve as effective international transport links in the region, particularly for the landlocked countries.

The road network of Iran is more than 80,000-km long and more than 20,000 kilometers of these roads are incorporated into international transit network. In 2013, 1.5 million Iranian and foreign trucks crossed the border and more than 12 million tons of cargo was transported by transit by its railways and roads. Iran plans to increase transit of cargo up to 20 million tones in 2015.

However, despite all the progress made, there are numerous obstacles of objective and subjective nature that impede the development of the transit transport routes in Eurasia. According the UN Department of Transport and Economic Affairs, the delays on the border crossings in the countries along the ancient Silk Road is about 40% due the customs procedures.

It should be emphasized that Iran has decided to use its capabilities in the field of transit

to facilitate the economic integration of the region with the global economy. Iran has adopted a number of programs in the transport sector aimed at the development of international transit and transport infrastructure. These programs stipulate for the following measures: further development and equipping the port of Chabahar in Southwestern Iran in the closest proxi-mity to the Indian Ocean. The port is vital for the transit of goods to Afghanistan, Central Asia, and the Caucasus; enhanced cooperation in the field of transit transport, including rail and road

transport; time and cost reduction of cargo transit through the territory of Iran; attraction of foreign investment in transport infrastructure; expansion of the rail network in the North and East-West directions.

The transportation of energy resources is another significant issue. Iran is considered a key player in the energy market. The regional and global strategic importance of the routes of transportation results from geographical location of Iran, its richness in oil and gas, large population and vast territory. All these enable Iran to provide resources for the domestic consumption using swap transactions, to transport the energy resources from the regional countries to the consumers, and to supply its own oil and gas to the world markets.

Unfortunately, the external factors and political reasons prevent Iran from full realization of its potential in terms of energy transportation through its territory to the South and the West. Yet, there are some grounds for cautious optimism provided the talks on the Iranian nuclear issue are successful. Iran is willing to continue its cooperation with the states of Central Asia despite the above factors.

To conclude, I would like to emphasize the need for a serious approach in order to eliminate the obstacles for the regional transit that impede the economic progress in Eurasia.

Transport Corridors through Central Asia: How to Create Integrated Network amidst Geopolitical Tensions?

Year: 2015
City: Almaty