To build Lekki-Ijebu Ode, Badagry-Apapa rails   The federal government in the 2024 budget made a provision of N33.1bn for various railway projects across the…

By Abdullateef Aliyu | Thu, 14 Dec 2023 2:09:25 WAT

The federal government in the 2024 budget made a provision of N33.1bn for various railway projects across the country.

Daily Trust however reports that this was coming despite having a backlog of railway projects across the country which has stalled over lack of funding.

The N33.1bn which is contained in the 2024 budget of the Ministry of Transportation covers several projects as listed in the budget document ERGP 13177707.

The items included completion of Abuja-Kaduna; completion of Lagos-Ibadan and its associated additional works; rehabilitation of Itakpe-Ajaokuta rail line and construction of 12 nos station building and tracks laying works at railway ancillary facilities area, Agbor; completion of addendum 2a and railway ancillary facilities area, Agbor.

Other projects include the design, manufacture, supply, and installation of rolling stock, supply of spare parts and maintenance equipment for the ongoing railway modernization project; installation of signal and telecommunication system on the Itakpe-Ajaokuta-Warri railway line; installation of acoustal sensing security surveillance system for the Abuja (Idu)-Kaduna railway system and completion of feasibility studies for new standard gauge rail line including Kano-Dayi-Kastina-Jibiya including realignment to Dambata-Kazaure-Kastina-Jibiya-Maradi in Niger Republic; completion of feasibility studies for new standard gauge rail line: Kano-Nguru-Gusau.

But the N33bn is like a drop in the ocean amidst the backlog of existing projects; some of which have not even taken off at all.

The projects worth over $21.3bn (about N16 trillion) across the country are being stalled due to lack of funding, findings by Daily Trust have revealed.

The projects include the Ibadan-Kano Standard Gauge Railway ($5.3bn); N11.17bn Lagos-Calabar coastal railway project; the $3.02bn rehabilitation project for the Eastern Line (Port Harcourt-Maiduguri) and the $1.9bn Kano-Maradi Railway project.

All the projects were incorporated in the 25-year railway roadmap unveiled during the administration of former President Olusegun Obasanjo which expires in 2025.

The $11.17bn Lagos-Calabar coastal railway project which had been in the pipeline for almost two decades was in 2021 approved by the Federal Executive Council (FEC) during the Muhammadu Buhari-led administration.

But our correspondent learnt that most of the projects have been stalled as China has yet to approve fresh loans for the railway projects.

Only the Kaduna-Kano line which is a section of the Lagos-Kano Standard gauge is being funded by budgetary provision and has only reached about 23 per cent.

While several projects were still pending, the federal government made provision of another N1bn ($1.2m) for new projects including Lekki – Ijebu Ode Rail & Coastal Rail Lekki – Apapa/Tin-Can; Badagry – Apapa/Tin-Can as well as another provision of N1.5bn for railway modernisation.

However, under its separate budget, the Nigerian Railway Corporation (NRC) plans to spend N1.5bn for the procurement and rehabilitation of locomotives and rolling stock for the standard gauge while it was allocated another N2.7bn for procurement/rehabilitation of rolling stock (narrow gauge).

In addition, there was the rehabilitation of a narrow gauge track from Minna to Barrow with an extension to the Baro River Port.

Comment:

N33bn is about $40m. Our railway costs about $6m per km on average to build. So this budget provision can only build less than 7km but we have outstanding contracts for over 2,000km. See our problem? Railway hasn’t got the capacity to meet the need but It has signed these contracts for which government lacks the resources. So do the guys for roads, aviation, maritime, health, education, police, security, government administration and all the other government agencies and in the states and local governments too. Everyone wants a piece of a small cake that they don’t help to bake and there isn’t enough cake to satiate all the appetites. The agencies expect Fed. Min. Of Finance/ Debt Management Office to arrange loans for their contracts backed by income from hydrocarbons rather than their own productivity or resourcefulness. Loans that they are not concerned about how they are repaid? Yet with 200m people and 910,000 sq km, everything required to bake a huge yummy pudding is here. All we need is to know how and let the pathfinders lead.

Lagos-Kano contract was signed 17 years ago. It was supposed to be completed in 4 years. It’s not quite 25% complete. Lagos-Calabar was signed 9 years ago. It was supposed to be for 4 years. It’s 0% complete. Kaduna-Kano was signed in 2018 for 4 years. It’s just over 20% complete. Itakpe-Abuja, 2019 for 3 years. 0%. Port Harcourt-Maiduguri, 2021 for 4 years. Its not quite 10%. At this rate we will still be raising budgets for these projects from our graves assuming they don’t get abandoned like the over 50,000 others (according to Olisa Agbakoba SAN). How can we keep doing things the same way and expect a different result?

There are alternative ways of funding these projects but the government and its people must let go of control. It’s better to control 10% of a $100trn pie than a 100% of a $1trn pie. When will we start listening to ourselves? We agreed to reform since the time of President Obasanjo. So what could be stopping us if not ourselves and our love of mediocrity?

We must reform and restructure the railway environment now so that private capital can come in.We can’t get away from this. The constitution amendment is only the first though necessary step. We must unbundle the NRC to unleash the entrepreneurial spirit and capacity of the private investor and stop railway haemorrhaging cash. Many sub nationals are warming up to invest in railway, others like Lagos and few have started. We must ensure that there is an independent regulator in place as an urgent imperative. Unbundle NRC now!
It is of concern that there doesn’t appear to be any appropriation for NRC Unbundling in the FMT budget proposals. It suggests a lack of commitment by this government to continuing the reform of the railway and that the efforts of the past years have been in futility. It may also mean the NRC Act potentially operating in conflict with the constitution or creating a lacuna. We must act now