Tehran to Spend $10 Billion on Expansion of Public Transport

Tehran’s municipality plans to spend as much as $10 billion as part of a five-year plan to upgrade the capital’s infrastructure and keep up with population growth, an Iranian official said.

“This may be a great leap,” Hojat Behrooz, assistant to the deputy mayor for transportation, said in an interview in Dubai. “But with the deficiencies that exist in Tehran’s public transport, if it isn’t done we will certainly run into problems.”

More than 70 percent of the investment would be dedicated to doubling Tehran’s existing metro network to cover 300 kilometers (186 miles), Behrooz said. Adding 3,500 new vehicles to the city’s bus fleet is also part of the plan, he said.

Tehran’s municipality has been in talks with officials from China for the construction of 150 kilometers of metro lines and the purchase of some of the 2,300 metro wagons needed for the city, Behrooz said. Iran is generally keen to resume business cooperation with Europeans companies in light of a temporary easing of economic sanctions against the Persian Gulf nation, he added.

“Given changes at the international community level and good discussions we have had with French and German companies recently, we hope to be able to benefit once again from European companies’ potential in developing our metro lines,” Behrooz said.

Nuclear Program

President Hassan Rouhani, who started his term in August promising to address Western concerns about Iran’s nuclear program, has revived hopes that he’ll be able to drag the country out of recession and open up the nation starved of foreign investment amid sanctions. Some trade restrictions and capital controls have been suspended as part of an interim deal with world powers, that will bring about as much as $7 billion in sanctions relief for the nation.

As the two sides continue negotiations toward a permanent nuclear deal heralding a possible lifting of restrictions, international companies are exploring the Iranian market for opportunities. In February, a French delegation of more than 100 businesspeople visited Tehran, to meet with executives from the industry, construction and automotive sectors.

In the meantime, Iranian officials underline the pressing need for a comprehensive public transportation plan.

Air Pollutants

Tehran’s population has increased five-fold since 1960, and is approaching 9 million today. The 4 million active vehicles and 2.5 million motorcycles now circulating in the city are responsible for some 88 percent of air pollutants produced in Tehran, Behrooz said. The public transportation network only serves half of the 17 million daily journeys inside the city, he said.

“There is a definite decision by the Tehran municipality with the help of the government to expand the public transport system in Tehran,” Mohammad Montazeri, deputy managing director of Tehran Urban and Suburban Railway Co. said in an interview. The determination stems from the need to curtail “air pollution, very high consumption of gasoline and heavy traffic” in the city, Montazeri said.

Montazeri and Behrooz said that costs of transportation projects are usually divided between Tehran’s municipality and the government, and that Rouhani’s government has so far been supportive of the plan.

To contact the reporter on this story: Ladane Nasseri in Dubai at lnasseri@bloomberg.net

To contact the editors responsible for this story: Andrew J. Barden at barden@bloomberg.net Kim McLaughlin, Robert Valpuesta

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