How rail transportation is boosting Nigeria’s economy – An analysis



The Nigerian Railway Corporation traces its history to the year 1898, when the first railroad in Nigeria was constructed by the British colonial government on Oct. 3, 1912, to facilitate the flow of goods such as groundnut, cocoa and cotton from the inland to the coast.

Later, the Lagos Government Railway and the Baro-Kano Railway were amalgamated; starting nationwide rail service under the name Government Department of Railways.

With the passing of the Nigerian Railway Corporation Act of 1955, the company gained its current name as well as the exclusive legal right to construct and operate rail service in Nigeria.

However, the system collapsed due to years of neglect by the successive governments.

Its collapse adversely affected the economy by putting more pressure on road transportation and almost bringing it to a near collapse.

Happily, the narrative has since begun to positively change with the advent of President Muhammadu Buhari led-administration.

In line with his All Progressives Congress (APC) manifesto, Buhari has vicariously pursued the agenda to holistically transform the country’s transportation infrastructure.

Hence, the revamping and reintroduction of the railway system in the country is one of the best things that has l happened to the country’s economy.

The revamping of the system saves consumers billions of naira reduces the negative impact of insecurity on our roads as people who could not travel by road now have the option to travel by train either due to insecurity and saving themselves the problem of being on highway gridlock.

It has also reduces the high costs to taxpayers of highway construction and maintenance, while freight railroads mean more jobs and a stronger economy.

Many Nigerians also affirmed this as they expressed joy when the rail system in the country finally came back to life, after efforts and promises of many governments.

According to them, Federal Government’s effort in revamping the rail system across the nation is already yielding results as businesses are being boosted due to ease of moving goods to locations where they are needed.

Mrs Ogbomena Robert, a native of Delta and a trader, confirmed that her business was moving well after the resuscitation of Warri-Itape railway that links Delta, Kogi and Edo.

According to her, she can carry a lot of goods with ease by rail to distribute at various points of sales in the states linked by the railway.

”The reintroduction of the rail system is of great advantage to me and other local traders within our region. It is a thing of joy, especially to us here at this area.

”It is extremely important to ensure that the needs of both, the suppliers and the consumers are met, and this is made possible through the rail system, so I really appreciate the system,” she said.

Mrs Chika Nwachukwo, another trader also reiterated the importance of the railway, saying that in the situation of long transit rail transport is the preferred mode of transportation.

”Rail transport is much faster and more dependable; this is because it is usually the least affected by traffic jams.

”Large volumes of goods can be shipped over greater distances and easily and it is more economical, and much quicker for transporting large volumes of cargo,” she explained.

Mr Gabriel Ukpoh, a business man, said the importance of rail transportation to the nation`s economy could not be overemphasised.

According to Ukpoh, the re-introduction of railway has raised the hope of many rural women in particular, who have to transport their goods from one location to another.

“When the Warri-Itape rail line came back to live, many rural women in the community could not hold their joy and many of them took the opportunity to establish markets for petty traders along the rail corridors.

“This alone gives you a clear picture of a thriving economy within the local regions and this is capable of contributing largely to the growth and development of the nation,” he said.

The Permanent, Ministry of Transportation, Dr Magdalene Ajani, in one of her visits to Warri-Itape for inspection, expressed joy at the level of patronage and the quality of services rendered at the stations.

According to her, the initial concept of the Warri-Itape railway was to convey freight (cargo) from Ajaokuta Steel Company in Kogi to Alaja Steel in Delta.

She explained that considering the passenger components, the idea to upscale the infrastructure on the Warri-Itape rail route to also convey passengers was conceived following a high demand.

“This, of course, is applicable to all other rail routes across the country including other regions that are yet to get their own constructed,” Ajani said.

Mr Rotimi Amaechi, the Minister of Transportation, while recently inspecting construction works on the Kano- Kaduna rail line, reiterated the commitment of the present administration to link the country through rail.

According to him, the decision by the Muhammadu Buhari’s led government to fix the rail system is not tied to any political motive but for the growth of the country’s economy.

“I have told people, don’t politicise railway project, don’t make it look as if there are political motive behind the construction.

The essence of railway construction is to grow the economy,” he said.

Amaechi expressed hope that the Kano-Kaduna railway project would be completed and ready for commissioning by the president.

The project upon completion would facilitate public transportation, stimulate the development of the agricultural economy and manufacturing industries along the corridor and also reduce the cost.

Also, the recent awarded contract for a Wagon Assembly Plant in Kajola, Ogun is another step in the promotion of the economy through railways system.

The project is important because when completed, the it will not only address the increasing demand of both passengers and freight on the new Nigeria Standard Gauge Railway Service but will also have the capacity to produce 500 wagons annually.

It is expected that the plant will generate job opportunities for Nigerians and as well facilitate the much-desired objective of the government towards the local content capacity development.

“The project when completed, will be able to generate about 5,000 jobs and in the long run and Nigeria will be able to manufacture rolling stock for Nigerian use and for other African countries.

The Managing Director, Nigerian Railway Corporation (NRC), Mr Fidet Okhiria, who spoke on the aggressive rail policy of the present administration, expressed satisfaction at the commitment of government toward railway infrastructure in the country.

Okhiria observed that the efforts were yielding results as many Nigerians now have opportunities to travel and move their goods via railways across the country.

According to him, aside being capable of easing the strain on the country’s road network; rail transportation is safer, more reliable and economical.

He said this was particularly in terms of managing mass cargo movement within the country’s major cities as it enabled seamless transportation that engenders robust economies.

“The railway transport system creates jobs and enhances the growth and development of cities. It is a known fact that an efficient railway corporation will encourage movement of passengers and bulky goods.

“This will also bring about cheaper cost of transportation, resulting in reduction in the prices of local commodities and better living standard.’’

In the same vein, the President of National Association of Nigerian Traders (NANTS), Mr Ken Ukaoha, underscored the fact that the rail sector was very essential toward the realisation of any growth in any economy.

According to Ukaoha, rail is key to the distribution and redistribution of goods and services and it is also important for wealth creation.

He said that it was therefore important to commend the Buhari-led administration for making tremendous efforts in revitalising the nation’s rail sector.

He restated that the rail sector had brought about reduction in the cost of transportation, especially in the haulage of goods to the barest minimum.

Ukaoha said that it had also reduced the negative impact of insecurity on our roads as people who could not travel by road now have the option to travel by train.

“With train, wear and tear caused by heavy trucks on our roads is reduced and this brings more money to the pockets of our people and the government for other infrastructural facilities and development.

“Another thing is that with the rail system, more people can be moved and lifted at the same time and there is also reduction of accidents and the like,” he said.

The NANTS president, however, urged the government to ensure it increased security on our rail corridor to avoid loss of lives and goods and also boost the people’s confidence in using the rail system.

On vandalism of railway infrastructure, Ukaoha said the government should ensure perpetrators of the act were brought to book to deter others from getting into such act.

He said the government should also ensure a more efficient ticketing style that meets the standard in other climes.

”The media and government should ensure the people are properly educated on the importance of the rail system, they should understand it is their property and for their own good and therefore secure it.

”Most importantly, I urge the government to ensure more indigenes in the localities be trained to manage the rail line on rehabilitation, maintenance and even in the construction of new railway line,” Ukaoha added.

Mr Reynold Shodeinde, the Assistant Director, Chartered Institute of Logistics and transportation (CILT), said the revamping of the country’s railway had contributed to the Gross Domestic Product of the country.

According to Shodeinde, it has also eased movement of passengers and freight at lower costs than by road transport.

”Railways provide a huge source of revenue to the GDP; There is need to emphasise on movement of goods by rail to relieve the roads of the burden of over use in the transport of goods.

”Government should, however, connect more coastal ports with the hinterland and inland dry ports by rail lines.

”The use of rail to evacuate and transport freight will reduce cost of goods to a very large extent,” he said.

Mr Emmanuel John, the Director of Strategy, Transportation Growth Initiative, while commending efforts of the government to revamp the rail sector urged for more utilisation of local content.

John said: ”There is need for conscious training and capacity to improve local capacity both for construction management and operations rather than the current reliance of foreign expertise.

”There is need for effective deployment and management of technology to eliminate human to human interface in the travel value chain.’’

According to John, the revamping has enabled more people travel by rail and away from the security concerns on the road.

”What that does however is that it takes away more cars from the road, reduces national fuel consumption, reduces emission, reduces traffic congestion and a lot more.”

John noted that there was need for improved connectivity between rail and road; rail and port, saying, “this is why the connection of the Lagos- Ibadan rail to Apapa port is an outstanding connection.’’

On his part, Mr Matthew Odama, the Vice Chairman, Nigerian Institution of Mechanical Engineers, Abuja chapter, said the revamped railway system was gradually impacting the economy.

According to Odama, a typical example of this is the Abuja-Kaduna rail transit system that has become a hub of movement of persons to and fro.

”It has boosted the nation’s economy by providing revenue to the government, created job opportunities to the teaming unemployed youths and ensured conveyance of goods and services from one place to another.

”However, a lot of improvement should be done in enhancing the cargo system in haulage of petroleum products to reduce the burden of tear and wear to the roads and heavy duties vehicles as experience on our highways

”The government should build more of it to link more cities and state for easy accessibility by the people,” he said.


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