Middle Corridor - The Times Of Central Asia

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Middle Corridor

Middle Corridor Must Cut Delays, TITR Chief Tells TCA

The Middle Corridor has spent the past several years attracting freight away from longer or politically sensitive routes between Asia and Europe. Now its operators must make it function as a single, reliable corridor. “Reducing transit time is achieved not through a single solution, but through the consistent modernization of all key links along the route, from ports and terminals to railway infrastructure and digital tools,” Nurgul Zhakupova, Secretary General of the International Association “Trans-Caspian International Transport Route,” told The Times of Central Asia. [caption id="attachment_54935" align="aligncenter" width="1774"] Nurgul Zhakupova, Secretary General of TITR. Image courtesy of the subject[/caption] Known internationally as the Middle Corridor, the Trans-Caspian International Transport Route (TITR) connects China with Europe through Kazakhstan, the Caspian Sea, Azerbaijan, and Georgia, with onward connections through Turkey. Freight traffic has risen sharply since Russia’s invasion of Ukraine increased demand for routes bypassing Russia. According to official figures, container traffic grew by 36% in 2025 to around 77,000 TEUs, although total freight volume slipped to about 4.12 million tons from 4.48 million tons in 2024. The World Bank estimates that freight volumes along the Middle Corridor could triple and transit times could be halved by 2030 if the necessary investments and reforms are made. The European Union and international financial institutions have meanwhile committed to mobilizing €10 billion for sustainable transport connectivity in Central Asia, with the aim of developing a route capable of linking Central Asia and Europe in around 15 days. For Zhakupova, that means tackling bottlenecks across several countries at the same time. Building a faster railway in Kazakhstan achieves little if cargo then waits for a ship on the Caspian, becomes stuck at a border, or encounters another congested section farther west. [caption id="attachment_54945" align="aligncenter" width="1535"] Infographic: TCA[/caption] Infrastructure Races to Catch Up One immediate challenge is expanding infrastructure fast enough to accommodate container traffic and anticipated future freight growth. Kazakhstan launched the second Dostyk-Moyynty railway line and the Almaty bypass in 2025. Construction of the Moyynty-Kyzylzhar line and modernization of other sections are continuing. The Dostyk-Moyynty project alone stretches 836 kilometers and is expected to substantially increase rail capacity on the China-Kazakhstan axis. One of the Middle Corridor’s most difficult bottlenecks is not on land, but on the Caspian Sea. Growing traffic requires more vessels, while falling water levels and adverse weather complicate port and shipping operations. KTZ Express plans to acquire six multipurpose dry cargo container vessels: four are to be built by China’s Jiangsu Haizhongzhou Shipping Industry and two by the Baku Shipyard. Kazmortransflot is building two container vessels in partnership with Abu Dhabi Ports Group, while Azerbaijan is also considering expanding its fleet with ferries and roll-on/roll-off vessels for wheeled cargo. “Additional limiting factors remain the falling level of the Caspian Sea and adverse weather conditions. In this regard, a range of measures is also being implemented at the ports of Aktau, Baku, and Kuryk to minimize the impact of these factors on the stability of transportation,” Zhakupova told TCA. In Kuryk,...

GDP Forecast

Kazakhstan Forecasts GDP Growth Above 5% in 2027–2029

Kazakhstan’s government has approved a socioeconomic development forecast and draft republican budget for 2027–2029, projecting average annual real GDP growth above 5% as manufacturing, agriculture, construction, transport, and other non-oil sectors expand. The forecast was prepared with reference to the global economic outlook and conditions in external markets. The accompanying draft budget, approved at the same government meeting chaired by Prime Minister Olzhas Bektenov, will be submitted to the Kurultai for consideration. Under the government’s baseline scenario, real GDP is projected to grow by 5.3% in 2027, 5.5% in 2028, and 5.4% in 2029. Nominal GDP is expected to rise from KZT 199.3 trillion in 2027 to KZT 245 trillion in 2029, an increase of almost 23%. Non-oil sectors are expected to provide the main impetus for expansion. Manufacturing output is forecast to grow by an average of 5.9% a year, substantially faster than the 2% projected for mining. Metallurgy, mechanical engineering, construction materials, chemicals, and food production are expected to make the largest contributions. Oil exports and the broader mining sector will remain central to the economy and public finances, but the forecast assumes that manufacturing and other non-oil activities will account for a larger share of new output. TCA reported in July that Kazakhstan’s economy expanded by 4.1% in the first half of 2026 despite an 8.4% decline in oil production. The non-oil economy grew by more than 5%, with manufacturing, construction, trade, and transport accounting for more than 80% of overall growth. Manufacturing output increased by 9.8%. Agriculture is expected to expand by at least 5% annually. Construction is projected to remain among the fastest-growing sectors, increasing by 16% in 2027 and 17.3% in 2029. Deputy Prime Minister and Minister of National Economy Serik Zhumangarin said the expansion would be supported by transport and logistics, energy, and water projects, together with the modernization of housing, utilities, and social infrastructure. The services sector is also expected to maintain strong momentum. Trade is forecast to expand by an average of 5.7% annually, information and communications by 9.2%, and transport and warehousing by 10.4%. The transport forecast builds on rapid expansion along the Trans-Caspian International Transport Route, or Middle Corridor. Annual freight volumes through Kazakhstan have risen from 0.8 million to 4.5 million tons over seven years, while delivery times fell from approximately 28–32 days to 13–17 days. The route still carries substantially less cargo than established northern corridors, and participating countries continue to work on remaining bottlenecks. Infrastructure spending is a central element of the draft budget, but Bektenov said it must be accompanied by stronger financial discipline. Under President Kassym-Jomart Tokayev’s instructions, accelerated construction of infrastructure and social facilities has been designated as a principal budget priority. Government bodies were told to meet the approved economic targets, while administrators of budget programs were directed to increase the return on every tenge spent. The headline budget deficit is forecast to fall from 2.3% of GDP in 2027 to just 0.4% in 2029. However, the non-oil deficit, which measures the...

AIFC TCA Interviews

AIFC Interview: Central Asia Investment, Middle Corridor and ESG

The Astana International Financial Centre (AIFC) positions itself as a platform for international investment in Kazakhstan and across Central Asia. In an interview with The Times of Central Asia, Zhanbolat Kakishev, Chief Product Officer at the AIFC Authority, discussed competition for investment, financing for the Middle Corridor, investor protection, ESG, and currency risks. Kakishev said the AIFC ecosystem has attracted $26.3 billion in investment to Kazakhstan and registered more than 6,000 companies from 90 countries. TCA: How does the AIFC assess the current investment climate in Central Asia amid the fragmentation of global markets, and what share of foreign direct investment into the region does the centre aim to attract in the coming years? Zhanbolat Kakishev: We assess Central Asia’s investment climate as resilient and gradually strengthening despite the fragmentation of global markets. Moreover, the restructuring of global supply chains and investors’ search for new sources of growth are creating additional opportunities for the region. International investor interest in Central Asia already rests on a solid foundation. According to UNCTAD, by the end of 2025, the stock of foreign direct investment in the region had reached approximately $235.5 billion, of which $156.4 billion was in Kazakhstan. The region combines a substantial resource base, a growing domestic market, and a strategic position between Europe and Asia. It also has significant investment potential in areas including transport and logistics, energy, critical minerals, digitalisation, and financial services. The AIFC does not set a target in the form of a fixed share of total FDI flowing into Central Asia. Our task today is to continue improving the AIFC ecosystem, its infrastructure, and the conditions that allow international capital to enter Kazakhstan effectively, as well as to participate in regional projects. To date, $26.3 billion in investment has been attracted to Kazakhstan through the AIFC ecosystem. More than 6,000 companies from 90 countries are registered in the Centre’s jurisdiction. For us, however, it is not only the volume of capital attracted that matters, but also its quality — long-term investment that contributes to economic diversification, private-sector development, and the further integration of Kazakhstan and Central Asia into global capital markets. TCA: Given the growing interest in the Middle Corridor, or Trans-Caspian International Transport Route, what investment instruments does the AIFC offer to finance major infrastructure and logistics projects in the region? Zhanbolat Kakishev: The AIFC provides comprehensive legal and financial infrastructure for structuring and attracting financing for major infrastructure and logistics projects, including those along the Middle Corridor. Depending on the structure of a project, special-purpose vehicles or companies (SPVs/SPCs), joint ventures, and investment funds can be used to pool capital from strategic, institutional, and private investors. Through the Astana International Exchange (AIX), projects can also raise debt and equity financing, including through conventional, green, and sustainability bonds, as well as Islamic finance instruments such as sukuk. For large infrastructure projects, the ability to combine different sources of capital is particularly important. These can include financing from international financial institutions and banks, funds from strategic...

Transport Digitalization

Kazakhstan Rolls Out AI Tools Across Its Transport Networks

Kazakhstan is turning to artificial intelligence to help decide where its airlines should fly and which roads need repair, while other systems aim to move freight across its borders faster. The projects are part of a series of government digital systems intended to increase the country’s role as a regional transport hub. Air One of the most prominent projects is Echelon Alpha. The platform analyzes passenger demand and competition between aviation hubs to assess the economics of individual routes. It has already identified around 30 promising routes that could generate additional direct or transit passenger traffic for Kazakhstan. The full list has not been made public, although its developers have cited a potential Hyderabad–Astana–Moscow connection as an example of a route modeled by the system. Kazakhstan’s favorable location between China and Europe does not automatically turn Astana and Almaty into international aviation hubs. They have to compete for transit traffic with airports in Baku and Istanbul, as well as those in the Gulf states. According to Kazakhstan’s Transport Ministry, the model processed data covering around 200 million flights over the past five years, along with approximately 170 airline reports. It also combines geomarketing data with information from open and commercial sources. Its claimed forecasting accuracy is up to 90%. “Echelon Alpha uses artificial intelligence to analyze market dynamics in real time and provide a basis for fast, accurate solutions,” said Echelon Alpha founder Rakhman Asambayev in an interview with Forbes Kazakhstan. The system assesses the commercial viability of new routes and their potential effect on the economy. Its developers estimate that the proposed network could have an annual economic impact of around $153 million, although the figure has not been independently verified. Kazakhstan is also introducing biometric Q-Gate terminals at its airports. They verify passport data against facial biometrics in 15 to 50 seconds, four to five times faster than standard checks, according to government estimates. Road Launched around two months ago, e-Joldar uses AI to track road conditions and repair spending, while also collecting data on the quality of construction materials. More than 25,000 miles of national roads have already been digitized. By the end of the year, monitoring is expected to cover the country’s entire road network of around 115,000 miles. Smart Cargo may have a more immediate effect on international freight operators. The platform combines data from 58 information systems in a single digital portal. Authorities say operators can access cargo information through a QR code. AI checks documentation and identifies the necessary permits, while the platform helps determine routes and tracks shipments. The government says Smart Cargo has increased border-crossing speeds by 30% and cut carrier waiting times by a factor of 10. These figures are based on government estimates. Rail On the rail network, digitalization is being paired with major capacity expansion as Kazakhstan pursues its transit ambitions, including through the Middle Corridor. KinetiX performs contactless diagnostics of rolling stock. Government figures indicate that it has reduced technical inspection times by 30% and manual measurements...

Foreign Policy

Kazakhstan Updates Its Foreign Policy Concept in a More Difficult Era

President Kassym-Jomart Tokayev has approved targeted amendments to the document that sets the principles and priorities for Kazakhstan’s dealings with the outside world. The changes align the doctrine with Kazakhstan’s new constitutional order, remove its remaining provisions tied to Nazarbayev’s formal role, and come at a time when multi-vector diplomacy has become far more demanding than it was in 2020. The amendments to the Foreign Policy Concept for 2020–2030, signed on August 14, attracted attention after KazTAG reported on them. Kazinform subsequently highlighted changes concerning the protection of citizens abroad, public understanding of foreign policy and the new Kurultai. A Foreign Policy Concept is Kazakhstan’s overarching diplomatic doctrine. It sets the principles, priorities and responsibilities intended to guide state policy through 2030. The August changes are limited in length. They remove its remaining references to Nursultan Nazarbayev’s formal role, bring the document into the Kurultai era, and give the Astana International Forum formal recognition in the doctrine. Other language now attracting attention is older. Sovereignty, protection of citizens, and resilience to negative external influence were already in the 2020 document. The difference is the world in which Kazakhstan now has to apply them. From Personal Legacy to Institutional Continuity The first principle in the 2020 concept referred to continuity with the foreign policy course of the First President and Elbasy, Nursultan Nazarbayev. The new wording promises “continuity of the foreign policy course at a new stage of the country’s development.” The revised text no longer names Nazarbayev or uses the Elbasy title. The amendments also remove a provision that gave the First President a lifelong right to address the public and state bodies on major foreign policy questions. The Constitutional Law on the First President was repealed in 2023, and the concept no longer lists it among its legal foundations. This follows a process that began years ago. The special legal provisions associated with the Elbasy framework have been repealed, while Tokayev has continued to acknowledge Nazarbayev’s place in the history of independent Kazakhstan. Tokayev was also closely involved in the foreign policy he inherited. He served twice as foreign minister, as prime minister, and later as director-general of the United Nations Office at Geneva. The revised concept places foreign policy continuity on an institutional rather than personal basis. Adapting the Foreign Policy Concept to the New Constitution Kazakhstan’s new Constitution came into force on July 1, replacing the Senate and Mazhilis with a unicameral Kurultai. The first election to the 145-seat body is scheduled for August 23. The old concept described the foreign policy functions of the bicameral parliament. The amended version now identifies the Kurultai as Kazakhstan’s highest representative body exercising legislative power. Signed nine days before the election, the change places the foreign policy doctrine inside the wider constitutional transition and removes references to institutions that no longer exist. The revision also fits Tokayev’s broader effort to move Kazakhstan beyond a political system shaped by the formal privileges of its first president and towards one intended to...

Middle Corridor

Kazakhstan Middle Corridor Railway Cuts Detour, but Caspian Bottlenecks Remain

Kazakhstan expects to complete the roughly 323-kilometer Moyynty-Kyzylzhar railway across the Karaganda and Ulytau regions of central Kazakhstan by the end of 2026. The new line will shorten the Middle Corridor by 149 kilometers and ease congestion on the existing route via Zharyk. Kazakhstan Temir Zholy said in July that 202.5 kilometers of track had been laid. For the China-Europe route, however, the next test is the Caspian Sea. Containers must be transferred from trains at ports in Kazakhstan to ships bound for Azerbaijan, then returned to rail. The speed and regularity of these transfers will determine whether the hours saved within Kazakhstan translate into shorter delivery times. What the New Line Changes Moyynty-Kyzylzhar will give transit trains a more direct route from the Chinese border toward the Caspian and ease pressure on the Moyynty-Zharyk section, where east-west freight competes with domestic traffic. The project is designed to accommodate double-stack container trains and includes provisions for future expansion and electrification. The World Bank projects that capacity on the section will rise from 14 to 28 pairs of freight trains per day, while transit time via the new route is targeted to fall from eight hours to six by 2031. In February, the World Bank approved an $846 million guarantee intended to mobilize $1.41 billion in commercial financing for the project. Across Kazakhstan, the time savings will be more modest. Transit from Dostyk, on the Chinese border, to Aktau is expected to fall from about 72 hours to 68 hours by 2031. Farther west, the country is also modernizing the Shalkar-Beineu and Beineu-Mangystau sections leading toward the Caspian ports. The Caspian Remains a Bottleneck The European Union (EU) aims to reduce transit time along the Trans-Caspian route to no more than 15 days. The European Bank for Reconstruction and Development (EBRD) has estimated that the route has the potential to move cargo between China and Europe in around 18 days, but infrastructure and connectivity constraints have produced transit times ranging from 14 to 60 days. For shippers, reliability is as important as speed. Freight Is Growing Faster Than Caspian Capacity Pressure on the Caspian section is already increasing. In 2025, Kazmortransflot carried 59,400 twenty-foot equivalent units (TEU) on the Aktau-Baku-Aktau feeder route, more than 15% above the 2024 level of 51,400 TEU. In May 2026, container traffic between Aktau and Azerbaijan reached a company record of 7,451 TEU. Kazakhstan is expanding its port infrastructure as well. The EBRD and the EU are financing upgrades at Aktau, including two dedicated container berths and new handling equipment. The project is expected to double the port’s container-handling capacity. Caspian fleet capacity is another constraint as rail freight grows. Falling Caspian Sea levels are also limiting how fully some vessels can be loaded. From an Alternative to Russia to a Commercial Route After 2022, geopolitics increased demand for the Middle Corridor. It offered Europe a route to Central Asia and China that bypasses Russia, while providing Kazakhstan with another connection to European markets. The corridor increasingly has to compete on commercial terms....