China and Iran have finalised a major deal on July 15 to electrify 1,000 kilometres of the Razi–Sarakhs railway line, a vital transport artery linking Turkey and Turkmenistan through Iranian soil, Tejarat News reported on July 28.

The agreement, announced in Beijing during a meeting between Iran’s Railway CEO Jabbar Ali Zakeri and China Railway President, marks a significant step in deepening bilateral trade ties and advancing the Belt and Road Initiative (BRI).

China Railways has had a long relationship with Iran, being the only country apart from Russia willing to work with Iran. The programme to invest also comes as part of efforts by Beijing to shorten transit times between Southern Europe and East Asia as part of the so-called southern corridor, which runs through Iran both south and west. The rail link is a significant milestone in Tehran’s efforts to expand trade and infrastructure links across Eurasia. The Iranian state media reported that the inaugural train departed from Tehran in May and travelled more than 5,300 km to the Chinese city of Xi’an in just over 14 days. The route, which crosses Turkmenistan and Kazakhstan before entering western China, forms part of the broader China-Central Asia-West Asia corridor under Beijing’s Belt and Road Initiative (BRI).

The project covers half of the nearly 2,000-kilometre corridor, aiming to upgrade the infrastructure by electrifying and expanding dual-track sections, substantially increasing freight capacity and speed.

Currently, only the Tehran–Mashhad section is double-tracked. This expansion will enable faster, higher-volume container transit across Iran. It will strengthen its role as a key Eurasian logistics hub, with Chinese engineering teams likely to play a significant part in contracts. 

The deal comes amid a surge in rail container traffic between China and Iran. In the first half of 2025, container volumes jumped by 260%, showing the corridor’s growing importance in linking China with Europe and Central Asia. This rapid growth highlights the potential of the China–Iran–Europe rail corridor to revive the historical Silk Road’s legacy as a trade lifeline.

Despite geopolitical tensions that continue to threaten regional stability, including last month’s cancellation of a China–Armenia multimodal service passing through Iran due to security concerns, Tehran and Beijing remain committed to boosting transport connectivity.

This infrastructure upgrade forms part of a broader multilateral push involving Kazakhstan, Uzbekistan, Turkmenistan, and Turkey to develop an integrated Eurasian logistics network.

The proposed Trans-Afghan Railway has become the second most strategically important initiative for Uzbekistan after the China-Kyrgyzstan-Uzbekistan (CKU) railway, according to Deputy Minister of Transport Jasurbek Choriev.

The railway would take a route running from Termez, Uzbekistan, to Naibabad, Maidan Shar and Logar (all in Afghanistan) and through to Kharlachi (in Pakistan on the border with Afghanistan). Route mapping, geological surveys and economic and financial assessments will all form part of the study.

In its initial phase, the railroad, as envisaged, would carry up to 3mn tonnes of cargo annually, and there are plans to scale up to 15-20mn tonnes by 2035–2040.

The delivery of the Pakistan section of the railway will involve building through challenging mountainous terrain, requiring the construction of five tunnels and 312 bridges.

Of the new investment, Iranian officials described the opening as a “breakthrough”, as it will reduce transport costs and delivery times for goods traded between the two countries. The overland journey is significantly shorter than traditional maritime routes via the Strait of Malacca and the Suez Canal. The route also effectively bypasses the US sanctions on Iran and also provides China better overland access to the Middle East.

“The launch of this corridor is a major step forward in diversifying Iran’s trade routes and strengthening its position in regional transit,” said Iranian Minister of Roads and Urban Development Mehrdad Bazrpash.

The rail link is expected to allow the direct delivery of Iranian bulk goods like petrochemicals, agricultural products and construction materials, while facilitating the import of Chinese electronics, machinery and consumer goods.

Iran has invested heavily in recent years to expand its rail infrastructure, which comes in the context of other developing overland links, including the Middle Corridor. There was also a new railway link between China and Kazakhstan that opened in November 2023, the Ayagoz-Tacheng railway connection, which is also part of the BRI. The new railway line connects Tacheng in China's western Xinjiang region with Ayagoz in eastern Kazakhstan. It is the third rail border crossing between the two countries, alongside the Alashankou-Dostyk and Khorgos-Altynkol corridors.