OPEC Fund supports strategic rail corridor to boost connectivity and international trade in Türkiye

August 25, 2025: The OPEC Fund for International Development (the OPEC Fund) is committing €150 million to support the development of a high-standard electrified railway in eastern Türkiye. The Kars-Iğdır-Aralık-Dilucu (KIAD) Railway Project will enhance transport connectivity, reduce travel time and increase cross-border trade across the Trans-Caspian East-West Middle Corridor, linking Europe and Asia via Türkiye.

OPEC Fund President Abdulhamid Alkhalifa said: 

“Efficient, sustainable infrastructure is key to expanding opportunity and building regional resilience. Our support for this project will improve freight logistics, open new economic pathways and strengthen Türkiye’s role as a critical bridge between continents.”

The KIAD Railway Project comprises the construction of a 224km electrified double-track, high-speed railway with modern signaling and safety systems, connecting Türkiye’s eastern provinces of Kars and Iğdır with the Dilucu border crossing with Azerbaijan. The line is strategically located along the Middle Corridor, a priority trade route linking China and Europe and designed to reduce cargo travel time from 18 to 12 days in comparison with existing routes. Once completed, the new link is expected to carry around 2 million tonnes of freight and 650,000 passengers annually. 

The new railway will include electrified double tracks, modern signaling and safety systems, and design speeds of up to 160 km/h for passenger and freight trains—offering a faster, more reliable and sustainable alternative to road transport. 

The project will address key infrastructure gaps in eastern Türkiye and is expected to lower transport costs, alleviate congestion and shift freight from road to rail, helping reduce greenhouse gas emissions. The new link will also boost accessibility to remote communities and create thousands of jobs during the construction and operation of the railway line.

The OPEC Fund’s contribution complements a co-financing package led by the Mitsubishi UFJ Financial Group (MUFG) with support from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), the Swedish Export Credit Agency (EKN), the Oesterreichische Kontrollbank (OeKB) and the Government of Türkiye. The total project value is estimated at €2.7 billion.

The KIAD project is aligned with Türkiye’s Transport and Logistics Master Plan 2053, which aims to increase the share of rail freight, lower emissions and enhance the country’s competitiveness as a regional logistics hub. It also concurs with the OPEC Fund’s strategic priorities of advancing sustainable infrastructure, regional integration and climate action.

About the OPEC Fund

The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively. The organization works in cooperation with developing country partners and the international development community to stimulate economic growth and social progress in low- and middle-income countries around the world. The OPEC Fund was established in 1976 with a distinct purpose: to drive development, strengthen communities and empower people. Our work is people-centered, focusing on financing projects that meet essential needs, such as food, energy, infrastructure, employment (particularly relating to MSMEs), clean water and sanitation, healthcare and education. To date, the OPEC Fund has committed more than US$29 billion to development projects in over 125 countries with an estimated total project cost of more than US$200 billion. The OPEC Fund is rated AA+/Outlook Stable by Fitch and S&P Global Ratings. Our vision is a world where sustainable development is a reality for all.