Prospects for Development of Iran’s Transport Infrastructure

Tehran is focused on building up port infrastructure and railway corridors to become a major logistics hub

Today Iran is focused on building up port infrastructure and railway corridors to become a major logistics hub, RISS expert Ekaterina Andreeva writes in the analytical article of journal "National Strategy Issues". However, after Trump came to power and tightened the sanctions policy against the Islamic Republic, Iranian plans to turn into a regional transportation hub slowed down. "Tehran also lacks foreign direct investment. At the same time, due to internal economic difficulties and Western restrictions, Tehran doesn't have sufficient funds to continue its activities," she underscored.

China is one of the largest investors in Iran's transport infrastructure. For Beijin, the Islamic Republic is particularly important because of its geographical location that is highly significant for the Belt and Road Initiative. Tehran gives landlocked Central Asia and the Caucasus, where the PRC is seeking to become the major political force, access to Iran's Persian Gulf seaports.

Despite the difficult economic situation in the country, as well as the US sanctions pressure, Iran is trying to use all available resources to develop its own transport infrastructure, RISS expert points out. However, investment reduction is likely to force Tehran to postpone some projects. India and China's intention to involve the Islamic Republic in their international transport projects may attract additional financing. "Tehran expects to receive large Chinese investment that are directed to the development of transport facilities. But a serious problem for Iran, which is under sanctions pressure, will be debt repayments," Andreeva concluded.

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