Persian Gulf Rail Deadline to Be Re-Set Amid Oil Price Plungeby
Governments to meet in Riyadh next month to discuss project
`Realistic' alternative to 2018 date sought, minister says
Development of a 1,350-mile (2,170-kilometer) railroad network along the Persian Gulf linking Kuwait with the Indian Ocean is likely to be delayed as the six nations involved review budgets for the project because of the drop in oil prices.
The completion target date of 2018 is unfeasible, and the Gulf Cooperation Council member countries will meet in the Saudi capital of Riyadh next month to set a new deadline, United Arab Emirates Minister of Infrastructure Development Abdulla Belhaif Al Nuaimi said. The regional scope would remain unchanged, he said.
“All of us agreed” at a regional meeting last year to fix a new date, and “we have asked all the ministers to come up with a realistic program," Al Nuaimi said Wednesday at a Dubai press conference.
Oil is trading at about a 12-year low, and the impending cuts in government income prompted Standard & Poor’s earlier this month to lower credit ratings for GCC members Saudi Arabia, Oman and Bahrain. The U.A.E.’s Etihad Rail halted contract awards in January for extending lines currently serving the emirate of Abu Dhabi to the western border with Saudi and east to Oman via Dubai. The train operator also dismissed one-third of its workforce.
The U.A.E. will re-think its internal rail network if the GCC-wide deadline is deferred, Al Nuaimi said, adding that the idea was to build stronger ties between the six countries and that the national network was a "secondary issue" for the ministry.
“The formula will definitely be modified,” he said.