Kenya’s Ambitious Sh948 Billion Plan for Rail Transport Transformation

February 2, 2024
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SGR Madaraka Express train.

Kenya Railways is undertaking an ambitious Sh948 billion five-year plan that it claims will revolutionize railway transport in the country, making it a preferred mode for the movement of cargo and passengers.

According to Kenya Railways, the plan will involve overhauling some of the railway infrastructure, constructing more than 2,700 kilometers of new railway lines, and establishing two railway cities in Nairobi and Eldoret.

KRC stated that various projects outlined in the strategic plan for the five-year period until the 2027/28 financial year would incur a cost of Sh948 billion. A significant portion of the funds will be generated through the Public Private Partnership model.

“In order to effectively implement this Strategic Plan, a budget of Sh948 billion is required majorly comprising Sh803 billion for expansion and integration of the rail network,” said Kenya Railways.

“A total of Sh126.3 billion is expected to be raised internally and from the Railway Development Levy Fund (RDLF). The resource gap for implementation of the programmes and projects outlined in this plan will amount to Sh822 billion which will majorly be bridged through mobilisation of funding from government, development partners and Public Private Partnerships.”

Kenya Railways aims to construct 2,795KM of new Standard Gauge Railway (SGR) during the five-year period, marking an ambitious target given that the country currently has 622KM of SGR, comprising the 472KM Mombasa-Nairobi line and the 150KM Nairobi-Naivasha line.

The new SGR lines planned by Kenya Railways over the five-year period include SGR Phase 2B and 2C from Naivasha to Kisumu (269KM) and Kisumu to Malaba (107KM), along with the railway line along the Lamu Port South Sudan Ethiopia Transit (Lapsset) corridor.

Additionally, the plan involves expanding the Metre Gauge Railway network by 88 kilometres, upgrading 315 kilometres of MGR, and rehabilitating another 1039.6 kilometres of the old railway network.

Railway Cities

Kenya Railways also envisions constructing railway cities in Nairobi and Eldoret, as well as developing commuter rail lines in major cities, including Nairobi and Mombasa.

The Corporation is currently executing the Nairobi Railway City project at the central railway station, with the first phase anticipated to cost Sh30 billion. The development is expected to be replicated in other towns.

“The coverage of the Nairobi Commuter Rail (NCR) service will also be expanded to include metropolitan areas earmarked for the National Housing Scheme projects such as Ngong, Ruai and Konza,” said Phillip Mainga managing director of Kenya Railways.

The plan is expected to enable Kenya Railways to boost its freight market share of Port throughput from 26 percent in 2022 to 42 percent by 2027.

KRC also foresees transitioning from an operating loss of Sh2.4 billion in the 2022/2023 financial year to an operating profit of Sh 9.09 billion in the 2027/28 financial year.

The plan is currently undergoing public participation.

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