Transport routes through Kyrgyzstan (I.)

There have been several attempts to find a transport corridor that would bypass a certain country. The reasons for bypassing a country in the transportation of goods can vary, from political and security concerns to high fees. In this article we take a look on a route bypassing Kazakhstan – a major player in transport in Central Asia.

The idea of building the railway between China – Kyrgyzstan – Uzbekistan appeared in 1996, when China announced the start of construction of the South Xinjiang railway (Korla-Kashgar section). A year later, participants signed in Tashkent (Uzbekistan) and Bishkek (Kyrgyzstan) a memorandum of cooperation on the construction of the Kashgar-Osh-Andijan railway and the protocol of the first meeting of the joint working commission.

In 2002, the Chinese government allocated a technical grant (20 million yuan) to Kyrgyzstan to study the future highway, after which both sides chose the northern route, although China benefited from the southern option.

In June 2020 opening of railway trade route between China and Uzbekistan took place. The section passing through Kyrgyzstan is unfinished.

Issues causing disagreement among countries include route determination, railway track selection, financing sources, national security, environmental impact, geopolitical considerations, and more. For instance, China and Uzbekistan may prioritise a shorter and more economical transit route to Europe and the Middle East. On the other hand, Kyrgyzstan might advocate for a longer route that fosters connectivity between the northern and southern regions of the country.

In Kyrgyzstan there is a problem of different railway gauge widths (remained from Soviet times), which significantly complicates the project – it is necessary to build a station where wagons will be moved from track to track.

China’s interest in the route through Kyrgyzstan also lies in the presence of a large number of gold deposits in the country. More than ten years ago, the Kyrgyz government offered to pay China for the construction of the railway with gold mining rights. The status of this proposal is currently unclear.

As of 2023, according to the Ministry of Investment, Industry and Trade of Uzbekistan, the parties have previously agreed on a northern 450-kilometer route passing through Kashgar, Torugart, Arpa, Makmal and Jalalabad. The proposed route will pass through rugged mountainous terrain, but if successfully built, it is expected to cut delivery times to Europe by one week or more.

Companies responsible for the implementation of the project are State Enterprise “NC” Kyrgyz Temir Zholu” and JSC “Uzbekistan Temir Yollari”.

The first option of the road after the feasibility study cost $1.5 billion, during the discussion by 2020 the amount increased to $4.5 billion (up $6,5 billion according to different sources). As for the beginning of 2024 the final costs is unknown, but each country should finance at least 30% of its cost.

Kyrgyzstan is not likely to finance the construction of the project on its own. It is not yet clear what could become a source of funding. the growing level of authoritarianism in the country reduces the possibility of receiving investment from Europe. On the other hand, attempts to pull Kyrgyzstan away from Russia from the West may also include investments in transport infrastructure.

In Kyrgyzstan, a limit has been established according to which one creditor can account for no more than 45% of the total external debt. However, the country’s debt to China currently amounts to 39% of its total external debt, which is close to this limit.

According to Beijing, in 2022, Chinese exports to Kyrgyzstan amounted to $15.42 billion, while only $4.07 billion worth of goods were registered in Kyrgyzstan, which indirectly indicates that most of the trade between China and Kyrgyzstan consists of contraband goods.

The main beneficiary is China. The railway will allow increasing the volume of transportation, the dependence of which on weather conditions is minimal. The benefit to Uzbekistan and Kyrgyzstan is not obvious. On the one hand, this should stimulate the development of infrastructure and industrial production along the railway. On the other hand, the frequent changes of politicians and the high level of corruption in the countries will obviously not allow the full potential of the project to be realised.

The implementation of this route is unlikely to have an impact on transit on the territory of Kazakhstan, since the main goal does not bypass Kazakhstan, but the growth of Chinese imports in general. Any transports corridors along the Central Asian route are considered by China as an additional opportunity to supply its goods to Europe.