Transport and Logistics - The Times Of Central Asia

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Transport and Logistics

Containerization in Kazakhstan: How Simple “Packaging” Could Transform the Economy

Containerization is rapidly becoming one of the most talked-about topics in Kazakhstan’s logistics sector. Amid surging transit traffic, the question is increasingly raised: why, despite clear potential, is the domestic market still underutilized? What’s holding Kazakhstan back from making containerization a cornerstone of its integration into global trade? Currently, transport costs account for up to 30% of the final price of goods in Kazakhstan, nearly three times the global average of around 11%. Experts agree that a systemic transition to containerized transport could speed up delivery times, cut logistics costs, and boost the competitiveness of Kazakhstani products. Yet progress remains sluggish. A Priority Still in Waiting In September, President Kassym-Jomart Tokayev named the development of containerization as a strategic economic priority. Despite this, containers make up only 7% of domestic freight transport, less than half the global average of over 16%. Meanwhile, transit volumes are surging. According to Kazakhstan Temir Zholy, the national rail company, container transit grew by 59% last year to 1.4 million twenty-foot equivalent units (TEU). The national target is 2 million TEU by 2030. Yet this growth is bypassing the domestic economy: Kazakhstan remains a transit bridge between China and Europe without yet unlocking containerization for its own industries. Hidden Resources Still Untapped Research by Russian consulting company Arthur Consulting suggests that Kazakhstan has the potential to containerize 50-55 million tons of domestic cargo, a volume capable of revitalizing the country’s entire logistics ecosystem. So why hasn’t it happened? The reasons are well known. First, infrastructure remains underdeveloped. Modern terminals capable of handling high volumes are lacking. Many transport routes lack essential repair facilities and service centers, meaning containers must often be returned without proper maintenance. Second, there is a chronic shortage of containers and fitting platforms. This forces businesses to opt for cheaper, less efficient alternatives. Third, current tariffs make container transportation less attractive than road transport or covered railcars. Under such conditions, containerization appears more costly than beneficial. And lastly, there is a widespread lack of expertise. Some industrial players still don’t fully understand how to work with containers, optimize logistics, or implement modern transport solutions. As a result, a significant portion of cargo is still transported the “old-fashioned way”, in covered railcars. This increases costs, extends delivery times, and limits access to multimodal transport routes. Speaking at the New Silk Way transport and logistics forum, held in Almaty in September, Arthur Consulting partner Boris Poretsky described the sector as being “stifled” by systemic barriers. He emphasized the need for industrial companies to re-evaluate their logistics strategies. While nearly any cargo from bulk materials and liquids to heavy machinery can now be containerized, many exporters and consignees have yet to capitalize on the benefits. Containers allow for door-to-door delivery without transshipment, reduce loading and unloading times, improve cargo safety, and offer maximum flexibility, whether by sea, rail, road, or even air. [caption id="attachment_39789" align="aligncenter" width="300"] @Dauren Moldakhmetov[/caption] A Global Shift Worldwide, industries are rapidly adopting containerized logistics. The benefits are significant: 10-15% cost savings,...

Strategic Partnership

Kazakhstan and Armenia Forge Strategic Partnership in Landmark Summit

Kazakhstan and Armenia have upgraded their relations to a strategic partnership after high-level talks between President Kassym-Jomart Tokayev and Prime Minister Nikol Pashinyan in Astana on 21 November. The decision was sealed in a joint statement and framed as the start of a new phase in cooperation between the two Eurasian partners. During the official visit, the two sides exchanged 15 intergovernmental and interagency documents. These cover the protection of classified information, land for diplomatic missions, a trade and economic roadmap for 2026–2030, and cooperation in industry, agriculture, healthcare, science, education, digitalization, and the peaceful use of atomic energy, as well as new links between national museums, libraries, and film institutions. A Kazakhstan–Armenia Business Council was also created to bring companies into the process. Tokayev underlined the political meaning of the upgrade, stating that an “open and trusting political dialogue has been established between Astana and Yerevan at all levels. Interstate ties are truly constructive, with significant potential for their comprehensive strengthening and expansion.” Pashinyan, meanwhile, stressed the human dimension, noting that “we respect the Kazakh people, and this respect is the foundation for the further development of bilateral relations.” Their meeting builds on Tokayev’s official visit to Yerevan in April 2024, when the two governments first drew a roadmap for closer ties. Symbolism played a significant role in the visit, with Tokayev awarding Pashinyan the Order of Altyn Qyran (Golden Eagle), Kazakhstan’s highest state honor, in recognition of his role in Armenia’s development, regional peace efforts, and bilateral relations. This year, Yerevan has hosted the Days of Kazakhstan Culture and opened a park named after the Kazakh poet, Abai, while Kazakhstan has promoted Armenia’s cultural presence at events and academic centers, helping anchor the relationship beyond government channels. [caption id="attachment_39747" align="aligncenter" width="900"] Image: Akorda.kz[/caption] The strategic label is the high point of more than three decades of diplomatic relations. Armenia and Kazakhstan first established ties in August 1992, and shortly opened embassies in each other’s capitals. A Treaty of Friendship and Cooperation was signed in Astana in September 1999. Both are members of the Eurasian Economic Union and the Collective Security Treaty Organization, which lends their interaction a dense multilateral framework. Now, trade and connectivity are catching up with political rhetoric, with both sides eyeing room to expand. According to Armenia’s economy minister, bilateral trade reached $104 million in 2023, up 2.4 times from 2020, with Armenian exports making up more than two-thirds of the total. Kazakh figures, meanwhile, show mutual trade rising but still at a modest $53.1 million by the end of 2023, partly due to the lack of rail links and past transit restrictions in the South Caucasus. Those obstacles, however, are beginning to ease. In October, Azerbaijani President Ilham Aliyev lifted restrictions on transit to Armenia, which allowed the first shipment of 1,000 tons of Kazakh wheat to reach Armenian markets via Azerbaijani territory in November. Kazakhstan and Armenia also plan to launch direct air links and expand air cargo, a step Tokayev has called...

Border Incident

Traffic Jam of 1,500 Trucks Reported at Kazakhstan-China Border Crossing

Approximately 1,500 freight trucks have been stranded at the Nur Zholy border checkpoint between Kazakhstan and China, Nur.kz has reported, citing the State Revenue Committee (SRC) of Kazakhstan. According to the SRC, the congestion occurred despite a prior agreement with China to allow at least 800 trucks to pass through the crossing daily, with plans to increase that figure to 1,000 by year-end. However, from November 8 to 12, the actual number of vehicles processed by the Chinese side averaged only 700 to 750 per day. This shortfall was cited as the primary reason for the backlog on the Kazakh side. Compounding the issue, repair and installation work at the Kalzhat-Dulaty crossing significantly reduced its capacity for about a week. As a result, part of the freight traffic was diverted to Nur Zholy, placing additional pressure on its infrastructure. To alleviate the congestion, authorities have implemented a temporary adjustment to the electronic queue system. Starting November 13, daily vehicle entries will be capped at 650 to ensure a more balanced distribution of traffic and to support operational stability. The SRC stated that the situation is under constant monitoring and that negotiations with Chinese officials have resulted in mutual agreement on measures to improve border throughput. In May, President Kassym-Jomart Tokayev issued a formal reprimand to then Transport Minister Marat Karabayev for persistent problems at border crossings and delays in key transit infrastructure projects. Karabayev was dismissed from his post the following month.

river transport

Kazakhstan Eyes Revival of Ili River Corridor as Logistics Artery

River transport has long offered a cost-effective and environmentally friendly alternative for moving cargo. Inland waterways present an alternative route that could unlock new logistics pathways for Kazakhstan and the broader Central Asian region. Yet the development of river navigation remains hindered by several challenges. Kazakhstan’s inland waterway system faces numerous obstacles: insufficient investment, underdeveloped port infrastructure, an aging fleet, and bureaucratic red tape. Despite these issues, reviving river navigation could significantly boost mutual trade, increase cargo volumes, and ease pressure on overburdened road and rail networks. The government has initiated several projects aimed at doing just that. One notable initiative is the proposed route along the transboundary Ili River in the Almaty Region, connecting the city of Konaev with Yining in China’s Xinjiang Uyghur Autonomous Region. Originating in the Tien Shan mountains, where the Kunges and Tekes rivers merge, the Ili River stretches 1,439 km, with 620 km or 43% within Kazakhstan’s borders. [caption id="attachment_38136" align="aligncenter" width="2560"] Image: Ili River Port LLP[/caption] The project is a joint venture between Kazakhstan’s Ili River Port LLP and China International Water & Electric Corp. In an interview with The Times of Central Asia, Marat Julaev, CEO of Ili River Port LLP, stated that the navigable section of the route spans 450 km. Historically, the Ili served as a key transport artery, facilitating trade and connectivity with remote regions. “This route was navigable and operational until 1980. It was used to transport dry goods, ores, petroleum products, and consumer goods from China,” Julaev explained. Following the collapse of the Soviet Union, navigation along the Ili declined sharply. Extensive water usage in China caused water levels to fall, compounding the route’s inability to compete with road and rail alternatives. However, with mounting congestion and capacity constraints in land-based infrastructure, the river’s strategic role is being reconsidered. “In the Almaty Region, we’ve been allocated a 100-hectare plot on the coast of the Kapshagai Reservoir, providing a strategic advantage in reducing delivery time and costs,” Julaev told TCA. “Our Chinese partners, operating in Kazakhstan since 2006, are developing the route between Yining and Konaev.” [caption id="attachment_38137" align="aligncenter" width="2560"] Image: Ili River Port LLP[/caption] A central component of the project is the creation of a transport and logistics hub to consolidate and distribute cargo across Central Asia. The river port will offer terminal services, storage, sorting, equipment maintenance, and passenger transport. Plans also include developing production facilities and cargo terminals on-site. Commissioning is expected in 2027, with an initial cargo turnover capacity of one million tons annually, potentially rising to three million. According to Julaev, this development will enhance Kazakhstan’s foreign trade with China. Julaev emphasized one of the route’s key advantages: the ability to transport oversized cargo, including materials for Kazakhstan’s first nuclear power plant under construction in the village of Ulken on Lake Balkhash, which is fed primarily by the Ili. An equally critical issue is water availability. According to the UN Development Programme in Kazakhstan, over 44% of the country’s river flow originates in...

State Visit

Aliyev, Tokayev Pledge Deeper Cooperation as Azerbaijan Lifts Armenia Transit Ban

Azerbaijan’s President Ilham Aliyev began a state visit to Kazakhstan on Monday with a series of high-level meetings and a significant policy shift: Baku is lifting all restrictions on the transit of goods to Armenia. The move, announced during joint talks with Kazakh President Kassym-Jomart Tokayev in Astana, is one of the most concrete regional gestures since the end of the Second Karabakh War. The visit began with an official welcoming ceremony at Akorda Presidential Palace in Astana, where Presidents Kassym-Jomart Tokayev and Ilham Aliyev reviewed an honor guard before holding bilateral talks and chairing the second meeting of the Kazakhstan–Azerbaijan Supreme Intergovernmental Council. Speaking at a joint press briefing after the meeting, Aliyev confirmed that, “All restrictions on the transit of goods from Azerbaijan to Armenia and from third countries to Armenia through Azerbaijan have been lifted.” While no formal agreement was signed on Monday, the announcement is being viewed as a confidence-building measure at a moment of cautious diplomacy in the South Caucasus. Tokayev welcomed the development and stressed the importance of expanding cooperation between Kazakhstan and Azerbaijan in key sectors such as transport and energy. Ties on a Strategic Track Aliyev’s visit comes as Kazakhstan and Azerbaijan are expanding cooperation in multiple areas, including rail, ports, digital infrastructure, and energy. Monday’s talks produced several new accords and project announcements, including commitments to expand freight flows along the Trans-Caspian International Transport Route (Middle Corridor) - a logistics network connecting China to Europe via Central Asia, the Caspian Sea, and the South Caucasus. Since Russia’s 2022 invasion of Ukraine upended established overland trade routes, the corridor’s importance has surged, with Astana and Baku positioning themselves as key actors in a reconfigured Eurasian logistics network that bypasses Russian territory. In his welcoming address, Tokayev framed Aliyev’s state visit as of “critically important significance for the further development of our strategic partnership.” Tokayev described the relationship as “allied in nature,” calling Azerbaijan “a regional power that has strengthened its authority on the international stage.” He emphasized that developing multifaceted cooperation “remains a priority” and highlighted trade, economic, and political partnership as key goals. “Azerbaijan is a special country for Kazakhstan, a fraternal state,” Tokayev stated. “We are united by common historical roots, a rich spiritual and cultural heritage, and, ultimately, a shared mentality and outlook on developments. On this unshakable foundation, we are successfully developing our multifaceted cooperation.” Aliyev, in turn, praised Kazakhstan’s ongoing political and economic reforms, saying his country “fully supports [Tokayev’s] course of modernization” and is aiming to “strengthen cooperation in all areas” In a related development, Azerbaijan’s state energy firm SOCAR and Kazakhstan’s sovereign wealth fund Samruk-Kazyna are expected to deepen their collaboration in upstream energy projects and petrochemical exports, though no new energy deals were signed on Monday. Transit Opening to Armenia: Why Now? Aliyev’s announcement on transit restrictions - made in Astana, not Baku - was notable not just for its content, but its timing and setting. Since the end of the 2020 Second Karabakh...

Transport and Logistics

Bottlenecked: Eurasia’s Freight Lifelines Falter

Amid heightened geopolitical tensions and stricter border regulations, key transit routes linking China and Europe via Kazakhstan and Belarus have experienced severe disruptions. The resulting bottlenecks have exposed the fragility of Eurasian logistics and cast doubt on the reliability of the overland corridors central to China’s Belt and Road Initiative. From Military Maneuvers to Transport Gridlock For over two decades, Kazakhstan has invested heavily in developing its transit potential, aiming to become the main bridge between China and Europe. But in September and October this year, logistical bottlenecks began to appear, chiefly at border crossings. The disruptions were triggered by the closure of Belarusian‑Polish checkpoints following the launch of the Zapad 2025 military exercises (12‑16 September 2025) conducted by Russia and Belarus. On September 12, the day the exercises began, Poland suspended road and rail traffic after drones reportedly entered its airspace. Belarus claimed the drones had veered off course due to electronic warfare measures involving Russia and Ukraine. Despite this explanation, Poland invoked Article 4 of the NATO charter, prompting the alliance to launch Operation Eastern Sentry to bolster its eastern flank. The closure lasted nearly two weeks, during which more than 130 freight trains from China, carrying cargo worth billions of euros, were stranded. The China Factor and Limited Alternatives China responded diplomatically: on 15 September, Foreign Minister Wang Yi held talks in Warsaw; on 22 September, Politburo member Li Xi visited Minsk. Despite these efforts, border reopening was not immediately expedited. Alternative routes proved inadequate. The Trans‑Caspian International Transport Route (Middle Corridor) — through Kazakhstan and the Caspian Sea — is growing but still modest in capacity. In 2022 its potential was assessed at around 80,000 TEU annually. Some forecasts estimate it may rise to 10 million tons per year by 2027, but it remains well short of the volumes handled by the northern rail corridor. According to Logistan, the route currently has a monthly capacity of under 10,000 TEU, far short of the 40,000 TEU demand. The World Bank estimates that upgrading Middle Corridor infrastructure will require $27-$29 billion over 15 years, primarily for rail and port development. Amid these limitations, China tested a new maritime option: in September, an ice-class container vessel departed Ningbo-Zhoushan for the UK via the Northern Sea Route. The move indicates Beijing’s growing interest in Arctic alternatives to land corridors. Kazakhstan-Russia Hubs and “Gray” Transit As disruptions continued on the western flank, issues emerged in the south. Since mid-June, Russian logistics companies have reported delays at Kazakhstan’s border crossings. Kazakhstan’s Ministry of Finance attributed the slowdowns to increased inspections aimed at intercepting counterfeit goods. Forbes reported that roughly 7,000 trucks, carrying Chinese cargo worth hundreds of millions of dollars, were stranded. Many shipments used simplified declarations, often disguised as textiles or raw materials, and sometimes included dual-use items. Despite denials from both Kazakh and Russian authorities, freight companies cited congestion stretching for kilometers. The situation worsened after Russia imposed new migration rules restricting Kazakh drivers to 90 days of stay per year. The Kazakh government...