FG Allocates N41.49 billion for Rail Infrastructure in 2025 Budget, Aims to Boost Economic Growth

The Federal Government has earmarked N41.49 billion for rail infrastructure and modernization projects as part of its proposed N49.74 trillion budget for 2025. This allocation is part of the government’s broader push to enhance the nation’s transportation network and stimulate economic development through improved connectivity.

The Ministry of Transport will receive a total budget of N256.73 billion for the 2025 fiscal year, with N223.80 billion dedicated to capital expenditure. Personnel costs are set at N30.99 billion, while N1.94 billion is designated for overheads. These funds will support a variety of key initiatives aimed at transforming Nigeria’s rail system.

Among the priority rail projects in the budget are the completion of the Abuja-Kaduna railway project, the Lagos-Ibadan rail line, and other critical upgrades. Specific funding has been allocated for each of these initiatives, highlighting the government’s commitment to advancing these projects. Additionally, the budget includes provisions for the rehabilitation of the Itakpe-Ajaokuta rail line and the construction of 12 new station buildings. Track-laying work at railway ancillary facilities in Agbor is also part of the plans.

A key focus of the 2025 budget is ongoing railway modernization efforts. The government has allocated funds for the design, manufacture, and installation of rolling stock, spare parts, and maintenance equipment. It also plans to install a signal and telecommunication system on the Itakpe-Ajaokuta-Warri railway line, alongside a sophisticated acoustic sensing security surveillance system for the Abuja (Idu)-Kaduna route, as well as other security upgrades.

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The budget further emphasizes the completion of feasibility studies for new standard gauge rail lines, including the Abuja-Baro-Itakpe segment and the Kano-Maradi line. In addition, the government will engage transaction advisors for the concession of these projects, furthering the country’s ambitions for modern, efficient rail transport.

This N41.49 billion allocation underscores the Federal Government’s commitment to creating a robust rail network that will not only improve connectivity but also drive economic growth across the country. By addressing existing gaps in the rail infrastructure, the government aims to boost transport efficiency and stimulate economic activity.

Recent reports from the National Bureau of Statistics (NBS) highlight the success of the government’s rail projects, showing significant growth in passenger numbers and revenue. For the third quarter of 2024, rail passenger numbers rose by 25.05% year-on-year, reaching 743,205 compared to 594,348 in the same period last year. Correspondingly, rail revenue grew by 13.83%, totaling N1.70 billion, up from N1.49 billion in Q3 2023.

Passenger numbers and revenue also showed upward trends in earlier quarters of 2024, with Q1 and Q2 recording substantial increases. Meanwhile, rail freight saw impressive growth as well, with cargo volume increasing by 39.7% to 96,401 tons in Q3 2024, up from 69,003 tons in Q3 2023. Revenue from freight transport surged by 89.6%, reaching N412.57 million.

However, there was a decline in pipeline transport, with volumes falling by 43.5%, resulting in a drop in revenue to N51.85 million.