Etihad Rail, FAB sign Dh1.99b deal for passenger transport service
The deal comes as part of the UAE National Railways Programme, the largest land transport system of its kind in the UAE, where First Abu Dhabi Bank will be the certified lead arranger for the loan
Passengers will be able to commute between Abu Dhabi to Dubai in only 50 minutes, between Abu Dhabi and Fujairah in only 100 minutes, between Dubai and Fujairah in only 50 minutes, and between Abu Dhabi and Al Ruwais in only 70 minutes. — File photo
Etihad Rail on Thursday said it signed a Dh1.99 billion financing agreement with First Abu Dhabi Bank (FAB)) to launch railway passenger transport services in the country.
The deal comes as part of the UAE National Railways Programme, the largest land transport system of its kind in the UAE, where First Abu Dhabi Bank will be the certified lead arranger for the loan.
Sheikh Theyab bin Mohamed bin Zayed Al Nahyan, Chairman of the Abu Dhabi Crown Prince’s Court, and Chairman of Etihad Rail, and Sheikh Mohamed bin Saif bin Mohamed Al Nahyan, Vice-Chairman of FAB’s board of directors witnessed the signing of the agreement by Shadi Malak, chief executive officer of Etihad Rail, and Hana Al Rostamani, group chief executive officer at FAB.
“Through this agreement with FAB, we at Etihad Rail look forward to enhancing cooperation, uniting efforts, and working together towards realising the vision of the UAE in accordance with the goals of the UAE National Railways Programme, which was launched under the Projects of the 50 to establish the basis for a new stage of sustainable economic growth for the country,” Sheikh Theyab said.
Dr Sultan Ahmed Al Jaber, Minister of Industry and Advanced Technology; Mohamed bin Hadi Al Hussaini, Minister of State for Financial Affairs; Jassim Al Zaabi, member of the Executive Council and Chairman of the Abu Dhabi Department of Finance; Mattar Mohammed Al Tayer, member of the board of directors of Etihad Rail and director-general and chairman of the board of executive directors of the Roads and Transport Authority (RTA) in Dubai, as well as members of Etihad Rail’s board of directors, the board of directors of FAB, and a number of officials from the UAE Ministry of Finance and the Department of Finance in Abu Dhabi, attended the signing ceremony.
Connecting 11 UAE cities
Etihad Rail’s passenger services will be connecting 11 UAE cities and locations from Al Sila to Fujairah. It is expected to serve more than 36.5 million passengers annually across the country by 2030.
At a speed of 200km per hour and with a capacity of 400 passengers per train, the passenger service will help reduce traffic and save time. Passengers will be able to commute between Abu Dhabi to Dubai in only 50 minutes, between Abu Dhabi and Fujairah in only 100 minutes, between Dubai and Fujairah in only 50 minutes, and between Abu Dhabi and Al Ruwais in only 70 minutes.
Atik Munshi, managing partner, FinExpertiza UAE, welcomed the move and said the rail service is a popular mode of travelling in many parts of the world.
“Though the emirate of Dubai is well covered with the metro network there is currently a gap in respect to passenger train connections with the other emirates. With the advent of Etihad passenger rail, this gap shall be filled to a great extent,” Munshi told Khaleej Times on Thursday.
Considering the time saving alone, he said it could become a very popular mode of transport for people, as Etihad train will take only 50 minutes to cover the distance between Dubai and Abu Dhabi.
“It is commendable that FAB is playing a key role in this development. In my view, some more infrastructural development by UAE to further extend the metro into other emirates would significantly reduce the traffic burden and help the environment considerably,” he said.
He said the UAE government is very keen and serious about Projects of the 50 and this is one more concrete development for the same.
National Railways Programme
Etihad Rail’s passenger service is one of the three strategic projects of the National Railways Programme, which was launched by the UAE government in December 2021.
The programme forms the largest land transport system in the UAE, which is set outline the future of the railway sector in the coming years, in addition to providing freight rail and integrated transportation services.
“As we look to the next 50 years of our nation’s journey, the UAE continues to lead the region in setting a bold and progressive vision for the future. FAB is integral to that journey and committed to driving economic growth and improving the quality of life for citizens and residents,” Sheikh Mohamed bin Saif said.
“Through our support for the Etihad Rail project, we are reinforcing the UAE’s position as a global and regional transport and logistics hub, leveraging our strategic geographic location to improve and reinforce our links with the rest of the world,” he said.
Global transport hub
Shadi Malak said Etihad Rail is an essential component of the Gulf Cooperation Council (GCC) rail network, and this agreement brings us one step closer towards realising our strategic goals of strengthening the UAE’s reputation as a regional and global transport hub.
“Through this agreement, we will move full steam ahead with our mission to provide passenger railway services, which will bolster public transport system in the UAE and the wider region,” Malak said.
Hana Al Rostamani said Etihad Rail is proof of the sense of vision and purpose that makes the UAE distinct.
“By connecting the UAE through a fully-integrated rail network, Etihad Rail will bring significant economic and social benefits to the businesses and communities it serves, empowering future growth and providing opportunities for all. FAB is proud to support Etihad Rail in fulfilling this important project which will drive forward economic development for our nation,” Al Rostamani said.
Mohammed Shaheen, CEO, Seven Capitals, said this announcement comes out to be a big news for everyone.
“It will further enhance and strengthen cooperation, uniting efforts between the latter. This collaboration will benefit the market and will work towards the vision of the UAE in accordance with the goals of the UAE National Railways Programme in launching sustainable infrastructure for a better economic growth. The market will boom for sure!”
Bal Krishen, chairman and CEO, Century Financial, said developed as a part of the Projects of the 50, the UAE Railway Programme represents an integrated strategy for the UAE’s railway sector over the next three decades.
“Several railway projects are part of the plan, which will connect the seven emirates to major cities and airports in the UAE. The program is expected to create economic opportunities amounting to Dh200 billion,” Krishen said.
He said Etihad Rail is the developer and operator of the UAE’s national railway network. It signed a Dh1.99 billion ($541.8 million) deal with FAB on Thursday to finance passenger railway transport services.
“As a result of the agreement seal between the two entities, the motion can now move forward in full force, which will help to improve the public transportation system in the UAE and throughout the region,” he said.
“With record-low interest rates, this is the right time to invest in infrastructure projects and FAB gets an opportunity to participate in long-term projects. Upon completion, Etihad Rail will be a significant economic and social benefit to the businesses and communities it serves and will provide opportunities for future growth in the UAE,” he said.
Project is on track
Etihad Rail is forging ahead towards completing stage two of the UAE National Rail Network. Stage one of the Network has been operational since 2016. The project is progressing at an accelerated pace with 70 per cent of the project being completed in less than 24 months, despite the challenges of the pandemic. Etihad Rail has cooperated with 180 entities and issued more than 40,000 official papers.
The project involves more than 27,000 experts, specialists, and workers operating at more than 3,000 construction sites across the UAE, putting in 76 million work hours so far using more than 6,000 vehicles and pieces of equipment.