For the Central Asian states, the issue of direct participation in international transit cargo transportation is becoming relevant. Integration into the global transport network allows not only to expand the market for export products abroad, but also to join the intermediate trade turnover between countries and receive bonuses for the transit of goods through their territory.
The problems of developing its own logistics infrastructure have outgrown the national framework of the countries of Central Asia and Uzbekistan has the opportunity to improve the economic component of its transport policy.
At the same time, in the process of searching for the optimal option for integration into the regional international transit and transport system, it is worth paying attention to a number of individual factors.
First, the European Union’s intentions to expand alternative transport routes to Asian countries bypassing Russia.
Second, the Kremlin’s “transport turn” to the East, in connection with the sanctions restrictions of the collective West.
Taking into account the first factor, the existing Trans-Caspian International Transport Route (TITR – Europe, Turkey, Georgia, Azerbaijan, the Caspian Sea, Kazakhstan and China), connecting the West and the East, the volume of cargo transportation of which is steadily growing upward, becomes significant. In 2023, more than 2.7 million tons of cargo was transported along this route, which is 86% more than in 2022. This year, the volume of cargo transportation via TITR is planned to increase by 43%.
According to a World Bank report, the corridor has the potential to provide resilience and diversification of container trade routes between China and Europe, protecting countries and supply chains from geopolitical shocks. By 2030, travel time along the TITR will be halved.
Uzbekistan has the opportunity to integrate into this corridor by diversifying it: China-Kyrgyzstan-Uzbekistan-Kazakhstan and further along the proven TITR route.
In this case, one of the promising ones for Uzbekistan is the modernization and use of the Tashkent-Karakalpakia-Beineu -Aktau railway line, which will create the possibility of stable and accelerated supplies of goods and products to Europe and back. An extended route through its own territory to Karakalpakstan provides Uzbekistan with additional advantages from the provision of transit services. The length of the “lever” in Uzbekistan will increase by 850 km.
On January 30, 2024, at the Global Gateway investment forum in Brussels, the European Union pledged to invest 10 billion euros in the international corridor connecting Europe and Central Asia.
On the same day in Brussels, the European Investment Bank signed memorandums of understanding totaling €1.47 billion with the governments of Uzbekistan, Kazakhstan and Kyrgyzstan, as well as with the Development Bank of Kazakhstan. The EU emphasizes that these loans will be made possible thanks to guarantees provided by the European Commission. In addition, the European Bank for Reconstruction and Development signed a memorandum of understanding with Kazakhstan with an investment portfolio of 1.5 billion euros for projects already under preparation for the development of transport links in the Central Asian region.
This indicates the guaranteed modernization and expansion in the near future of the transit and transport corridor passing through neighboring Kazakhstan. Brussels opted for a time-tested route with the confidence of getting a “return” on its invested assets.
Taking into account the second factor, it is worth noting that the development of the Tashkent-Karakalpak-Beyneu railway route can contribute to the formation of a new international transport corridor in the North-South direction with subsequent connection to the Trans-Afghan Railway (Uzbekistan-Afghanistan-Pakistan), of which the completion of construction by 2027 was recently announced by the Deputy Minister of Transport of Uzbekistan Zh. Choriev.
Russia and Kazakhstan are interested in expanding North-South transport routes and are ready to fully assist and even invest in proposed projects for their development to reach the seaports of South Asia.
In this regard, the active use of the Tashkent-Karakalpak-Beyneu branch represents a promising direction for the integration of Uzbekistan into existing international transit transport communications and the creation of new routes. At the same time, it can be relevant both in the West-East and North-South directions, which ensures its relevance in the changing geopolitical situation.
How much the Uzbeks need this is a matter of time. /// nCa, 22 July 2024