G20 leaders unveil Israel-Saudi Arabia rail link plan

Crown Prince Mohammed bin Salman Al Saud  credit: Reuters
Crown Prince Mohammed bin Salman Al Saud credit: Reuters

The plan is part of a broader project to build a transport link between India, the Middle East and Europe.

At the G20 summit in New Delhi today, the US, India, EU and Saudi Arabia announced the promotion of a major railway and sea transport corridor between India and Europe via the Middle East. The project includes a rail link between Israel, Jordan, Saudi Arabia and the UAE. The summit was attended by leaders including US President Joe Biden, Indian Prime Minister Narendra Modri, Saudi Crown Prince Mohammed bin Salman, and EU President Ursula von der Leyen, which demonstrates the importance that the leaders attach to the plan, which would strengthen economic ties between Riyadh and Jerusalem.

Biden called the project "A Real Big Deal." Estimates in India are that the project will cost about $20 billion. Biden said, "The transportation corridor is designed to bring investments through shipping and railways from India, all the way to Europe, and through the UAE, Saudi Arabia, Jordan and Israel."

Biden did not mention this, but this is also a countermeasure to Russia's moves. About a week and a half ago, the first cargo train left Russia, via Iran - for Saudi Arabia as part of the "North-South" transport corridor. In the world in general and in India in particular, great importance is attached to shortening supply chains, and such a connection in the Middle East will be great news not only for passengers, but also in terms of speed and costs of supplying goods.

As reported by "Globes" last month, a rail link between Israel and Saudi Arabia, which Prime Minister Benjamin Netanyahu has already referred to, is expected to impact the entire region. Such a project would connect two projects promoted by the countries: on the Israeli side, the rail link to Eilat that has been talked about since 1957 but has not yet been built, and on the Saudi side, Mohammed bin Salman's tech city Neom, which will be based entirely on the production of electricity from renewable energies.

The Saudi Crown Prince's flagship project will be spread over 26,500 square kilometers, and built at an estimated investment of at least $500 billion. The northwestern end of the project, touches on the Straits of Tiran in the Red Sea and the journey to Aqaba in Jordan, next to Eilat, only takes about two and a half hours.

Transporting tourists, oil and goods

A rail link from Israel's Mediterranean coast via Eilat to Neom will enhance the infrastructure for transporting tourists, businesspeople and even bringing Israeli technologies to the Neom region, where an airport has already been built.

"The hope of the Saudis is to open the country to investment, and part of that is the city of Neom," explained Dr. Yoel Gozansky, senior researcher at the Institute for National Security Studies (INSS). "For this they need government investment, and also investment from the private sector."

One of the ways that could bring the private sector to Saudi Arabia is an infrastructure of railways that would connect Saudi Arabia and its neighbors through it, all the way to the Mediterranean. Such a transport corridor would not affect the transport of oil, but it could certainly be a logistical boon for the transport of goods and an alternative route to the Suez Canal.

Published by Globes, Israel business news - en.globes.co.il - on September 9, 2023.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.

Crown Prince Mohammed bin Salman Al Saud  credit: Reuters
Crown Prince Mohammed bin Salman Al Saud credit: Reuters
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