From the Varangians to the CIS

Russia’s transit potential has been recently the subject of wide discussions as it is located between the two global trade centers – the European and the Asian ones. The creation of infrastructure for multimodal transport corridors is proposed to realize this potential.

With its favorable geographic location Russia does not use its transit potential in full. There are lots of talks about such mega-projects as transit shipping along the Northern Sea Route and Transsib in 7 days but there are other opportunities as well. First of all, they appear with integration of Russian corridors with the European and Asian ones, with the key role to be played by automobile transport in conjunction with water and railway transport, if necessary.

However, motor transport is almost impossible to replace when transportation is needed for short distances. Nevertheless, the “short distances” is a relative term as it is much longer in highly-developed countries than in Russia. As Maksim Volkov, Director General of PhosAgro OJSC, said at the St. Petersburg International Economic Forum 2013, in Europe, automobile transportation of cargo is economically feasible at distances of up to 500 km, while in the North West of Russia it is viable only for up to 150 km.  Axle load limit is lower here than in Europe, therefore we carry 30 tonnes against 50 tonnes in Europe. The traffic speed also leaves a lot to be desired. 

Low density of highways is also under discussion though this factor is not so illustrative, we believe, as it takes into consideration vast unsettled territories with no need for highways. Therefore it is not correct to compare the density of roads in small Belgium with that of Russia.

Anyway, high profitability of transport industry is a prerequisite for investments in this sector. So, the Finance and Bank Council of CIS (FBC CIS) and Russian experts in motor logistics – specialists of logistic provider RTL, have developed a concept for the development of international transport corridors based on the creation of a network of automobile cargo terminals in CIS countries.

According to the project authors, there are fundamental prerequisites for the creation of transport corridors across the territory of Russia. They are the common customs space of Russia, Belarus and Kazakhstan as well as the demand for Europe-Asia trade routes. International transport corridors should be integrated with the existing pan-european corridors and use not only automobile but other types of transport to be linked with the seaports.

The concept determines the four “corridors”: “Silk Road” Moscow-Ufa-Astana-Bishkek-Urumchi (5,500 km), “Basma” Moscow - Rostov-on-Don – Nalchik – Makhachkala – Baku – Tegeran (2,200km), “East” Moscow-Krasnoyarsk-Chita-Harbin (8,000 км), “Cotton” Moscow-Samara-Orenburg-Tashkent (3,500 km). 

Within the framework of the “corridors” there is a plan to create a network of automobile cargo terminals with different services and functions, being simple or multimodal centers with railway, air, sea-river forms of transit and cargo transportation depending on the specific features of economic geography, cargo traffic volumes and other factors. It is also important to have an opportunity to consider each of the facility as an independent investment project complying with the regulations for direct investments from difficult funds and institutions.   

The novelty of the proposed project is the possibility of logistic supply allowing organization of a transport conveyor based on cargo transportation according to relay technology (change of locomotive or crew rotation) as being practiced by Rosautotrans. 
 
The other significant part of the project is the establishment of a unified information center servicing the network of terminals and ensuring sale of services on cargo transportation, freight traffic controlling and document flow.

12 economic entities – logistic complexes in CIS have already applied for entering the cargo traffic service system. Port Azov and Novaya Gavan at Ust-Luga port are among them.

Generally speaking, efficient realization of Russia’s and CIS’ transit potential is only possible with a qualified solutions in respect of the state and the development of the transport infrastructure in CIS including international transport corridors, determination of necessary amendments into national legislations, correlation of those amendments with the international legal framework regulating the operation of international transport corridors. Regulative, resource, information and logistic background for the establishment of international transport corridors within CIS requires deep work and is a matter of serious consideration for the entire industry.

Sophia Vinarova