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Iraq to start procurement for $1bn rail modernisation

2 July 2025

 

Iraq’s Ministry of Transport and its General Company for Railways division will soon start procurement for a $1bn-plus modernisation programme of its north-south main rail line.

Known as the Iraq Railways Extension & Modernisation (IREM) project, the scheme comprises the rehabilitation, upgrade and modernisation of 1,047 kilometres (km) of existing single-line track linking Umm Qasr Port in the south with Mosul in the north, running through Basra and Baghdad.

There will be two main construction packages. The first contract, expected to be tendered in October, covers:

  • Renewal of 32km of track between Al-Yussifia and Baghdad, totalling 32km, with an estimated cost of $33m
  • Renewal of 20km of track between Baghdad and Taji, totalling 20km, with an estimated cost of $21m
  • Renewal of the line between Baiji and Mosul, totalling 189km, with an estimated cost of $197m

The second deal involves the largest element of the programme: an estimated $570m deal to install European Train Control System (ETCS) signalling and ducts for optical fibre along the entirety of the line, including a safety level-crossing protection system for all official crossings along the alignment, and the modernisation of selected train stations.

The package will also include the:

  • Spot rehabilitation of the 72km-long Umm Qasr-Basr line, with an estimated cost of $4m
  • Spot rehabilitation of the 520km-long section between Basra and Baghdad, with an estimated cost of $32m

Requests for proposals for this second deal are due to be issued in January 2026.

Before then, the client is expected to tender an estimated $15m contract for the capex management role on the scheme this month.

Iraq’s rail sector consists of a 2,272km standard gauge network with 115 stations, most of which are in poor condition and provide only limited transport options.

The system features two main routes: the north-south line and an east-west line running from Baghdad to near the Syrian border.

There are also several short branch lines. Service is limited, with a few freight trains carrying oil and grain, as well as passenger services, including an overnight Baghdad–Basra train and a weekly train to Samarra.

The southern section of the north-south line was partly restored in 2014, allowing trains to run up to 80km an hour (km/h) with a 25-tonne axle load.

The northern segment, from Baghdad to Rabiaa and linking to Syria, operates at 40-60 km/h with an axle load limit of 18-20 tonnes. This section sees limited and irregular freight movement and contains a major workshop at Baiji that will be refurbished under the programme at an estimated cost of $10m.

The modernised railway line is expected to carry 6.3 million tonnes of domestic freight, 1.1 million tonnes of exports and imports, and 2.85 million passengers by 2037.

The IREM project is a central component of Iraq’s Development Road (IDR) Initiative, which aims to position Iraq as a regional transportation hub linking the GCC states with Turkey and then Europe. In the long run, the network is hoped to connect with the planned GCC railway in Kuwait.

The launch of the project follows confirmation from the World Bank of a loan agreement worth $930m to fund almost all of the project. 

Prior to the extension of the loan, Italy’s BTP Infrastrutture carried out the initial feasibility study and preliminary design work.

The firm is also conducting a similar contract covering a new multibillion-dollar 1,700km high-speed railway between Al-Faw on the Gulf coast and Fishkabour on the Syrian border, along with a major highway along the same alignment.

It has also been engaged on the design of the Al-Faw Grand Port project. 

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Edward James

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