ASTANA – The World Bank’s Board of Executive Directors approved on Feb. 19 an $846 million IBRD guarantee to mobilize $1.41 billion in long-term commercial financing for a major rail connectivity project along Kazakhstan’s section of the Trans-Caspian International Transport Route, or the Middle Corridor, a strategic trade route linking Asia and Europe.
Photo credit: Center for Global Development.
The Transforming Rail Connectivity in Kazakhstan (Middle Corridor Development) Project aims to improve the efficiency and resilience of the country’s rail network while strengthening the financial sustainability and commercial viability of Kazakhstan Temir Zholy (KTZ). The project will reinforce Kazakhstan’s role as a key Eurasian transit and logistics hub, supporting economic growth, regional integration, and climate resilience, the bank’s press service reported.
“Beyond enabling critical infrastructure investments, this project supports important reforms that will strengthen Kazakhstan Temir Zholy’s financial sustainability and long-term competitiveness. By combining phased investments, institutional reforms and private capital mobilization, we are helping build a modern rail system that will deliver lasting economic and environmental benefits for Kazakhstan and the wider region,” said World Bank Country Manager for Kazakhstan and Turkmenistan Andrei Mikhnev.
The project has two components. The first will finance the construction of a new 322.3-kilometer greenfield railway line between Mointy and Kyzylzhar, eliminating a major detour, shortening the corridor by 149 kilometers, relieving congestion, enabling double-stack container operations, and providing modern signaling and telecommunications systems, with provisions for future expansion and electrification.
The second will provide technical assistance and institutional strengthening to KTZ, including tariff reforms, alternative financing mechanisms, enhanced financial and environmental management, and preparation for a future initial public offering (IPO).
The project is expected to help triple freight volumes and halve transit times along the Middle Corridor by 2030. By shifting freight from road to rail, it will reduce transport-related emissions and support Kazakhstan’s climate commitments while improving market access, lowering trade costs and stimulating job creation along the corridor.
Implemented through a Multi-Phase Programmatic Approach (MPA), the project forms part of the joint implementation plan for the Middle Corridor in Kazakhstan, bringing together the International Bank for Reconstruction and Development (IBRD), the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA). It mobilizes $1.41 billion in private financing, supported by an IBRD guarantee of $846 million and a co-guarantee from the Asian Infrastructure Investment Bank (AIIB) of $564 million.
