By Ayomide Otitoju
The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a Shariah-compliant multilateral insurer and member of the Islamic Development Bank (IsDB) Group, has approved €135 million in Non-Honoring of Sovereign Financial Obligations (NHSFO) insurance to support the Kars-Iğdır-Aralık-Dilucu (KIAD) High Standard Railway Project in Türkiye. The transaction was arranged by MUFG Securities EMEA plc, including a Murabaha financing facility structured with ICIEC support.
Spanning 223.9 km from Kars to Dilucu at the Turkish-Azerbaijani border, the KIAD Railway is a flagship project under Türkiye’s 12th Development Plan (2024–2028) and forms a key segment of the Kars–Tbilisi–Baku corridor. The line, featuring five stations across Kars and Iğdır provinces, will enhance connectivity along the Silk Road Economic Belt and strengthen the Trans-Caspian Middle Corridor as a competitive Asia–Europe freight route.
The railway is expected to shift freight from road to electrified rail, cutting logistics costs by an estimated 40% by 2030, improving supply chain efficiency, and supporting regional industries. The project will create approximately 3,000 jobs at peak construction and stimulate broader economic activity. Its fully electrified, double-track design is projected to reduce CO₂ emissions by 498,276 tons annually and achieve 95% energy efficiency, making KIAD one of the region’s greenest transport initiatives.
Dr. Khalid Khalafalla, ICIEC CEO, said: “This strategic investment reflects ICIEC’s commitment to sustainable, high-impact infrastructure in Türkiye and our member states. The KIAD Railway strengthens regional connectivity, advances cleaner and more efficient transport solutions, and promotes trade integration between Asia and Europe. Our participation boosts financier confidence and accelerates the completion of this transformative project.”
The KIAD Railway also aligns with ICIEC’s mandate to promote inclusive development and integration among member countries. By enhancing freight mobility, supporting economic diversification, and contributing to Türkiye’s 2053 Net Zero vision, the project advances key UN Sustainable Development Goals, including SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation and Infrastructure), and SDG 11 (Sustainable Cities and Communities).
