Iran is taking major steps to become a key part of the China-Europe rail corridor. The country recently signed agreements to develop rail transport and build logistics villages. In addition, these projects aim to activate the southern branch of the East–West corridor linking China to Europe. The Islamic Republic of Iran Railways and investors behind logistics villages in Yazd, Sirjan, and Tabriz signed the agreements. They focus on expanding rail freight capacity and improving logistics infrastructure for long-distance trade.
Furthermore, the agreements cover several areas. They include building and expanding rail lines, setting up dry ports, issuing operating permits, and running rail-based freight services. These steps will strengthen Iran’s role in regional trade. Officials say the projects will help Iran increase the share of rail in cargo movement. They also aim to make Iran a major transit route for goods moving between continents. As a result, Iran expects higher trade traffic and faster shipments.
Recently, freight trains have entered Iran from China and moved toward Europe. Many trains have already arrived, and more will reach the Incheh Borun border crossing. This growth shows that businesses increasingly use overland trade routes. Meanwhile, the six countries involved in the rail agreement support this corridor. Iran, China, Uzbekistan, Turkey, Turkmenistan, and Kazakhstan agreed to unify tariffs and reduce transit times. Therefore, traders can move goods faster and more efficiently.
The new logistics villages in Tabriz, Yazd, and Sirjan will serve as hubs for storage, consolidation, and distribution. They will allow companies to transfer goods efficiently between domestic and international routes. In addition, these hubs will reduce delays and costs for freight operators. Iran sits at a strategic point connecting East–West and North–South trade corridors. Rail transit through Iran can cut delivery times to roughly one-third of sea transport times. It also offers a safe and cost-effective route across Eurasia.
However, Iran currently moves only a small share of East–West rail cargo. Infrastructure gaps, especially missing links at border crossings, limit its role. Traders face bottlenecks at the Razi border crossing, which handles only about 800,000 tonnes per year. The most critical gap is the rail connection between Marand and Cheshmeh Soraya on the Turkish border. A direct link will remove these bottlenecks and create a fully rail-based southern East–West corridor. By completing these projects, Iran hopes to expand its role in global trade and strengthen the China-Europe rail corridor. In addition, the rail corridor will help Iran become a central hub for intercontinental freight.