Russia plans new alternative multimodal corridor to Suez Canal
The blockage of the Suez Canal in late March forced many transport and logistics companies to use the new, alternative ways. Not only a private business has been paying attention to this issue but the governments and the state-owned corporations too. For instance, Russia is considering the possibility to launch its own multimodal alternative route to the Suez Canal by using the country’s inland waterways, the Caspian Sea and the rail network of Iran.
After the successful rail shipments of containers from Finland to India this summer, the North-South Transport Corridor has started to attract more and more parties concerned. Definitely, Russia is the most interested in the development of the route that is being considered as an alternative to the Suez Canal. Besides the freight trains, the transport corridor could add another mode of transport to its offer. It is the river-sea vessels that can move freight via the sea lines and inland waterways.
The extraordinary initiative was proposed by Alexei Rakhmanov, CEO of the United Shipbuilding Corporation (USC), the state-owned entity focused on shipbuilding projects for the Russian Navy and the private civil companies. According to him, USC is planning to start the design of the dedicated vessel. “We pay special attention to the South-North corridor. First of all, it is the Caspian Sea. This year, we will start the design of a container ship that will sail across the Caspian Sea to Helsinki,” Alexei Rakhmanov, CEO of the United Shipbuilding Corporation, said during his meeting with Vladimir Putin earlier this year. Let’s explore his idea in detail.
Mr Rakhmanov’s initiative suggests the arrangement of the multimodal delivery between Iran/China and Finland: first by rail to the Caspian Sea, and then by the inland waterways of Russia to Saint Petersburg with a shortsea section to Helsinki. The key focus in this idea is on the two canals inside Russia – the Volga-Baltic Canal and the Moscow Canal that the Caspian Sea with the Baltic.
“It is possible to take cargo in the north of Iran or in the west of China and take it to Helsinki through the port of Olya. The ship will sail from Olya to Helsinki at a speed of 19 kilometres per hour for seven to eight days. And no Somali pirates, no problems with grounded ships in the Suez Canal. This is, in fact, really an alternative,” he specified.
Moreover, there is an option for freight delivery to the ports of the White Sea via the White Sea-Baltic Canal. “If necessary, we can go to the White Sea, because such a possibility exists. The dimensions there are a little smaller, so the loading capacity will be slightly less,” Alexei Rakhmanov added.
It is worth noting that the entire transit time between Iran and Finland via the Caspian Sea and Russian inland waterways varies at least between 16 and 19 days. Four days are required for the rail freight delivery across Iran, namely from the Port of Bender-Abbas in the Persian Gulf to the Port Enzeli on the southern shore of the Caspian Sea. From five to seven days take for ferry south-north transit across the Caspian Sea, i.e. from Enzeli to Olya. And the last section, between Olya and Helsinki, requires seven-eight days. Such a transit time is competitive with that via the Suez Canal but there are several crucial obstacles for putting this idea into reality.
Of course, every new transport corridor has a right to life but its viability and competitiveness will depend on the ability of the parties concerned to tackle the crucial bottlenecks and other problems. Currently, it is unclear how much the transport via the proposed route will cost and who can arrange the multimodal delivery of this kind (rail-sea-river-sea). “The key issue is the cost of this transportation. We, together with transport companies, are solving this issue,” Alexei Rakhmanov assured the Russian president.
Besides the costs, there are some infrastructure restrictions on the Volga-Baltic Canal. Most of this inland waterway has a draft of 3.6 metres with only one exception. The 60-kilometre-long section on the Volga River between Nizhny Novgorod and Gorodets has a lower draft, no more than 2.6 metres. Such a difference will not allow the river-sea vessels to sail fully loaded and will increase the delivery cost.
And the last obstacle is the absence of dedicated and efficient river-sea vessels for moving containers. In the 1960s, there was developed the Volgo-Balt type of river-sea ships for transporting bulk and general cargo. To deliver boxes, these vessels need to be modernised. USC, as Alexei Rakhmanov declared, intend to design the new type of ships for this purpose. It would be exciting to see the ready prototype of the river-sea container ship. Perhaps, the success of DP World in testing the river-sea delivery from Turkey to Central Asia via the Volga-Don Canal will stimulate the Russian shipbuilders.
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