China has become the workshop of the world and remains eager to share the fruits of those labours. Rail plays a small but increasingly important role in getting some of those goods to market.
Since 2011, the China–Europe Railway Express, popularly known as the “New Silk Road”, has rapidly grown into a cornerstone of Eurasian logistics. The loose network has also become synonymous with China’s Belt and Road Initiative, as the best known of the People’s Republic’s soft power reach to embrace the globe within its trading sphere, knitting together China’s industrial heartlands with major European markets.
In 2023, according to multiple sources, Europe represented China’s second biggest goods trading partner, running close behind the United States. The European Union alone stood at RMB4.64 trillion (about US$0.65 trillion), which represents roughly 11% of China’s total goods trade that year. Present global trade hiatus aside, China continues to trade healthily with Europe, and getting those modern goods to market is following a historic path.
Counting the value
Chinese government figures put the value of goods on board New Silk Road trains at US$56.7bn in 2023. Over the same period, total China–EU goods trade amounted to about US$813bn, according to the EU Trade and Economic Security Directorate. That represents about 7% of all trade value going by rail. That’s commensurate with the lower end of rail-borne goods in European countries (like the UK, for example).
This underscores how the New Silk Road rail link has become a strategically significant but still niche corridor. However, that share already amounts to around 17,000 trainloads annually. Note also that while European domestic rail freight operators are struggling to hold on to their share, New Silk Road traffic is growing from a standing start.
A network, not a road
It would be more appropriate to dub this the New Iron Road, since it is railways that offer this land route between Oriental workshops and Occidental marketplaces. The railways, faster than ships and cheaper than air freight, weave across three principal corridors.
The Northern Corridor, a trans-Siberian route, traverses Kazakhstan, Russia and Belarus. This has been the busiest route in the past, offering the most direct links between Chinese hubs, typically Xi’an and Chongqing, to Duisburg, Hamburg, Warsaw and Moscow. However, Russia’s invasion of Ukraine has put the buffers on transit across their territory to Western Europe.
The Eastern Corridor, running broadly from China through Mongolia to Russia, has become a contentious issue for European powers, who observe Chinese trade with Russia flowing unimpeded. Concerns that the route has become a military conduit are rife.
A third Silk Road route exists, dubbed the Central Corridor or Middle Corridor. Technically, this is a multimodal option, involving a ferry crossing of the Caspian Sea (although through rail traffic is possible via Tehran).
This route connects hubs in Xi’an and Chengdu with Istanbul and onward into Southern Europe. It also provides a diplomatically friendly means of reaching Europe at large, albeit the need to ferry across the Caspian Sea makes it the slowest option. Nevertheless, transit times are still several days faster than typical sea voyages.
The route is still developing. Innovations like the freight train ferry across the Sea of Marmara, linking the cities of Bandırma and Tekirdağ in Turkey (avoiding congested Istanbul) can only serve to improve timings and reliability.
Geopolitical influences
The collateral benefits of the New Silk Road are not confined to end-to-end trade between China and Europe. Intermediate trade opportunities are opened up along the way. Landlocked countries, north of the Kunlun Shan mountain range, have all benefited. An arc of western Chinese territories, notably Xinjiang Province, along with the fan of Great Game nations (Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan), all now have alternative export routes beyond Russia, Iran, or traditional maritime options.
In Kazakhstan, Khorgos Gateway Terminal, a dry port, 2,500km from any shoreline, has become a transit point so important, it’s nicknamed the Suez of the East. Volumes have been growing exponentially since this desert outpost opened. Last year (2024), RailFreight.com reported that 8,730 trains used the port, a 12.5% increase from 2023, according to local sources. Previous issues of congestion are being addressed with expansions, currently taking capacity up to 24 trains a day.
Khorgos Gateway is operated by DP World. Initially the global terminal operator and logistics enabler had a management contract to run the facility. In 2018, DP World acquired a 51% stake in Khorgos SEZ.
Handling equipment
Khorgos Gateway operates three RMGs with a 41t lifting capacity. These are the terminal’s main working equipment and are kept busy transferring containers between standard gauge Chinese trains and broad gauge Kazakh rolling stock. To position the container doors in the correct direction as required, the RMGs are equipped with a rotating system between the spreader and the headblock.
The RMGs are supported by four RTGs that manage a container stacking yard, but do not handle trains. Both the RMGs and the RTGs were supplied by China’s Wuxi Huadong Heavy Machinery Co., Ltd. (HDHM). On the software side, Khorogos Gateway operates the Navis N4 TOS from Kaleris, which went live in 2016.
Supporting equipment includes six Kalmar DRT 450 reachstackers for handling loaded containers, and two Kalmar DCT80-45E7 empty handlers. Kalmar also supplied seven Kalmar TT 612d terminal tractors. Other equipment includes chassis, and a various small forklifts.
Impact on trade
Despite its remote location the fortunes of Khorgos continue to be driven by global events. In the desert sun of Khorgos, the heat of conflict in Ukraine may seem very distant. However, no one with an interest in the port has any doubts about the impact on trade there.
War in Europe, involving Russia, has made air cargo problematic since many airlines are reluctant to overfly Russian airspace. For example, British Airways discontinued its London-Beijing route in October 2024. Air freight has faced the double impact of decreased capacity and increased costs. That has widened the margin in favour of overland transit.
The threats of piracy and paramilitary attacks on shipping in the Red Sea have encouraged cargo vessels to avoid Suez and take the longer route around Africa. Conversely, trade between Beijing and Moscow remains healthy. As RailFreight.com observed, trade between those two powers grew 20% in 2024.
Growing pains
The sweet spot within which overland rail freight is the more financially attractive alternative transit mode is growing. Even so, there is little room for complacency. The port-to-port nature of air and sea transport is still attractive. Despite the number of trains on the New Silk Road approaching 20,000 annually, there are still logistical hurdles to overcome. The multiple overland border crossings for land bridge Eurasian trade are still a cause for concern, and trains are not immune to issues.
More obvious challenges revolve around the multiple border crossings. Rail regulations in Belgium are not the same as those in Beijing, for example. For that matter, Belgium and Britain don’t share the same standards, and even though their trains run on the same Standard Gauge tracks, Britain’s network was built to a tighter loading gauge – the overall profile through which loads can pass. It’s the main reason why Silk Road rail freight traffic gets no further than the “gauge cleared” route to Barking in the east of London, and has very little chance any time soon of making it all the way to the historic end of the road in Macclesfield.
Customs procedures
In addition, trains encounter multiple customs procedures, requiring detailed documentation and co-ordination across jurisdictions with differing regulations and enforcement standards. No one is suggesting relaxing border crossing standards – the trajectory is in the other direction – but harmonisation would be welcome if, like the harmonising of track and loading gauges, it remains something of a pipeline dream.
Snow and sand
Some things are beyond the will of governments and shippers. Weather and geography pose immutable hurdles. Harsh winters in Central Asia and Eastern Europe can disrupt rail lines, while there are also sandstorms in western China and bottlenecks at key hubs, such as Caspian Sea ferry crossings and those gauge transfer dry ports in Kazakhstan.
The original Silk Road was an evolving network over millennia. The New Silk Road – hardly two decades old – still has a long way to go. The Middle Corridor has limited capacity and is still developing in terms of infrastructure. Rail freight continues to grow but still carries a relatively small proportion of the overall trade, particularly on the key China-Europe flows. Maritime and air transport, which, although slower or costlier, often provide more reliability and scale. As demand continues to grow, there will be more occasions to test the resilience of the New Silk Road.
Engineering challenge
There is a unique challenge faced by international rail freight on the New Silk Road. Crossing continents involves crossing borders, but even before considering that, there is the practical matter of crossing gauges.
Not all railway tracks are born alike. The gauge, or width between the individual rails, varies throughout the world. Standard Gauge, a width of precisely 1435mm between the rails, is not called “Universal Gauge” because it’s anything but universal. It’s that engineering challenge, more than any political line in the sand, that has made the desert outpost of Khorgos Gateway such a commercial success, and also its more southerly cousin and longer-established crossing at Druzhba (also known as Dostyk).
The Chinese and the European ends of the New Silk Road use Standard Gauge for the most part. Kazakhstan, on the other hand, and Russia, and others in the former Soviet bloc use a broad gauge of 1520mm. For the sake of those 85mm, every container on every train (all 7,000 of them annually at Khorgos Gateway and at least as many at Druzhba) must be transloaded at border crossings to wagons with axles appropriate to the tracks for their onward travel. Even though it takes between six and eight hours to process a train, the time is minimal in the context of an overall Eurasian trip.
Chengdu to Lodz
In March, Kazakhstan State Rail company subsidiary JSC KTZ Express announced it has joined together with the China Railway Container Transport Co., Ltd. (CRCT) to launch a new container service connecting Chengdu in Sichuan Province to Lodz in Poland.
Trains will travel through Kazakhstan, Turkmenistan, Iran and Turkey. “The route will ensure uninterrupted delivery of goods and effective communication between the countries. The expected travel time is 40 days” Kazakhstan State Rail said.
“This route not only expands the region’s transport capabilities, but also makes international logistics even more flexible, fast and reliable. The launch of the service confirms the strategic role of Kazakhstan as a key transit hub and strengthens its position on the map of global cargo transportation.”
*This story first appeared in the June print issue of WorldCargo News
