Opportunities and Challenges: Trade & Transit Facilitation Measures in Afghanistan

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1 Opportunities and Challenges: Trade & Transit Facilitation Measures in Afghanistan Islamic Republic of Afghanistan Ministry of Finance & Afghanistan Railway Authority December 2017 Astana ( Kazakhstan )

2 History of Railway in Afghanistan The First Afghanistan had been Constructed in 1922 between Darul Aman and Kabul city with 7Km length. The comprehensive feasibility study of Kabul Kandahar Herat and connecting to Iran border had been conducted in 1975 by Sufrail company.

3 Importance of Railway Expansion in Afghanistan Afghanistan is a land bridge between Central Asia and South Asia and share borders with 6 countries. Both regions have a vast developed railway networks. Only Afghanistan lacks Railway infrastructure Development of Railway Infrastructure in Afghanistan would connect these two important Regions Plans for extension of Pakistan Railway Network into Afghanistan from Torkham and Spin Boldak Development of transport infrastructure in Afghanistan is not only important for its own economy, but also for the neighboring countries as well.

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5 Legal Framework for Railway Operations Afghanistan Railway Law provides for the following : - Setting up a Railway Authority and defining its powers and authorities. - The Law permits private sector to build railway tracks, operate and maintain railway infrastructure. - The law also provide for licensing requirements and competent authorities for issuance - The legislation also includes provisions for safety Afghanistan National Railway Plan(ANRP) - The one most important document being produced by ARA is the Afghanistan National Railway Plan (ANRP). - ANRP is based on key analysis and documents such as: The Terrain and Freight Corridor analysis The Commercial Market analysis Legal & Regulatory Framework

6 Afghanistan Railway Border Crossing Information Neighbor Country Border Crossing Point Extension of Railway Uzbekistan Hairatan (Balkh) Extended Length 75 Km Main line 63 Km loop line Tajikistan Turkmenistan Iran Sherkhan Bandar (Kunduz) Plan Plan Bishkent (Balkh) Aqina (Faryab) Torghundi (Herat) Chah-e-Sorkh (Herat) Plan Extended Extended Under Construction Zaranj (Nimroz) Plan Plan 50 Km Main line 10 Km loop line 5 Km Main line 10 Km loop line 3 Km Main line 30 Km loop line 62 Km Main line 20 Km loop line Pakistan Torkham (Nangarhar) Spin Boldak (Kandahar) Plan Plan China Wakhan (Badakhshan) Plan Plan

7 Recent Development in Railway Sector Drafting of Law for governing railway affairs and waiting for ratification by the Cabinet Establishment of Afghanistan Railway Authority Completion of 610Km Feasibility Study of Railway projects and Procurement of 680Km in Bilateral Afghanistan Turkmenistan: - Establishment of new railway crossing border station in Aqina(Afghanistan) and Imam Nazar(Turkmenistan) in NOV Signing of two Railway agreements on rule and regulation of railway communication across border between two countries. - Overhaul of the 13Km Railway lines at Turgundi cross border Railway station - Construction of 10 KM new railway in Aqina cross border Railway station will be started soon.

8 Continue Afghanistan Uzbekistan: - Signing of two Railway agreements on rule and regulation of railway communication across border between two countries. - Signing of Hairatan Mazar Sharif O & M contract. - Signing of Trade, Transit and custom facility agreement. - Signing Cooperation agreement on Railway Development. - Signing of Repairing & Maintenance contract for cross boarder bridge in Hairatan between two countries. Afghanistan Iran: - Completion of construction 31 KM railway inside Afghanistan (Up to Ghoryan). The project is part of 5 Nations Railway Corridor KM of railway is under construction. - Finalization of three railway agreements on rule and regulation of railway communication across border between two countries. - procurement of detailed design & construction of phase 4 of Khaf Herat Railway(43Km).

9 Continue. Afghanistan Tajikistan: - Finalization of agreement on construction of new railway connection between two countries. Multilateral Chabahar Trade & Transit Agreement - Signing of Chabahar Trade & Transit Agreement between Afghanistan, Iran & India Lapis Lazuli Trade & Transit Agreement. - Signing of Lapis Lazuli Trade & Transit Agreement between Five countries( Afghanistan, Turkmenistan, Azerbaijan, Georgia & Turkey - This agreement provides for multimodal transports including railway - Members countries commitments to simplify customs and transit procedures

10 Afghanistan 10 Years Railway Development Plan SN Railway Project Railway Length (KM) Prefeasibility Study Current Status Feasibility Study Detail Design & Construction Khaf Herat 3rd Section 62 Completed Completed Ongoing 1 Khaf Herat, 4th Section, Phase-1 43 Completed Completed Under procurement Khaf Herat, 4th Section, Phase-2 44 Completed Completed Under Negotiation for funding 2 Sherkhan Bandar Kunduz - Mazar-e-Sharif 187 Completed Completed Plan 3 Mazar-e-Sharif Sheberghan Andkhoy 220 Completed Completed Plan 4 Sheberghan Maimana Qala-e-Naw Kushk 472 Completed Ongoing Plan 5 Bishkent Kaldar - Jairatan 50 Completed Plan Under Negotiation 6 Torghundi Herat Airport 173 Completed Completed Plan 7 Chaman Spin Boldak Kandahar 1 st Phase 11.5 Completed Completed Plan 8 Chaman Spin Boldak Kandahar 2 nd Phase 96 Completed Completed Plan 9 Peshawar Torkham Jalalabad 75 Completed Ongoing Plan 11 Farah - Zaranj - Lashkargah 420 Completed Ongoing Plan 14 Herat - Farah 216 Completed Completed Plan 15 Lashkargah Kandahar 140 Completed Completed Plan

11 Need for harmonization of rules in Railway Unlike other sectors such as Roads and Aviation, Railway Sector suffers from lack of Harmonization Difference in hard infrastructures- CIS Gauge, Standard Gauge, and British Gauge Soft Infrastructure: No uniform rules for railway operations and border crossing Countries have different rules and regulations for customs clearance, transit, and border crossings TFA Implementation in 2018 Afghanistan Customs Department 5-Year Strategic Plan ( ) Along with automation, TFA implementation is an important component of the Plan

12 Challenges: Expansion of Railway in Afghanistan Afghanistan does not have the required resources to finance the construction of the national railway on its own Lack of skilled staff to manage and maintain railway equipment and infrastructure Security and political instability that may hamper development of the network Lack of standard, terminals, warehouses, staff and rolling stock No Institutional or Technological experience in railway operation. Breaking gauge in borders (CIS standards 1520mm)

13 Implementation of WTO Facilitation Afghanistan formally acceded to WTO in 2016 Afghanistan is also signatory to WTO Trade Facilitation Agreement that will come into force next year TFA provides for: common transit rules, border agency cooperation that includes joint control, alignment of procedures, development and sharing of common facilities, and alignment of working days and hours use of international standards, customs cooperation including exchange of information, verification Freedom of transit Border agency cooperation Use of customs to custom cooperation and joint costumes Exchange information Some CIS countries and Iran are not member of WTO and may not be obligated to implement TFA

14 THANK YOU