privatization of transportation in Iran

Privatization and Structure of Iran’s Transportation System

Summary: Iran’s land transportation fleet with 236,000 vehicles is in charge of carrying 76 percent of the cargo and 24 percent of the passenger loads in the country. The railroad network is also equipped with 500 locomotives, 15,000 cargo and 850 passenger wagons. Meanwhile, air transportation is carried out through 28 domestic airports working round the clock, 7 international airports and 6 exclusive bases belonging to the National Iranian Oil Company. Some 5.8 million passengers within and 1.4 outside the country are using the Iranian air transportation facilities. A total of 65 international flights are being made to 23 destinations throughout the world weekly. Of the total activities in the transportation sector, marine transportation has a share of 85 percent while those of the road, railway and air transportation are 13, 1.7 and 0.3 percent respectively.



The Ministry of Road and Transportation is responsible for building roads, railway tracks, airports and ports in the country and in charge of the road, air and marine transportation (except for the shipping line which falls within the category of the Commerce Ministry). The ministry is also in charge of making plans for expansion of facilities in various transportation areas based on defensive priorities and economic and social development schemes. The average share of various areas of transportation in Iran’s foreign trade is as follows:

Marine transportation 85 percent
Land transportation 13 percent
Railroad transportation 1.7 percent
Air transportation 0.3 percent


Region Average weight transaction with 15% coefficient
Eastern Europe 1.6 million tons
Commonwealth of Independent States 0.9 million tons
Afghanistan and Pakistan 0.15 million tons
Far East 1.8 million tons
Southeast Asia 2.6 million tons
Pacific 0.9 million tons
Africa 0.4 million tons
Persian Gulf littoral states 1.5 million tons
South America 2.9 million tons
North America 2.7 million tons


The Organization for Transportation and State Terminals is in charge of the land transportation. In addition to its headquarters in Tehran, the organization has a representative office in every province that supervises over transportation related affairs. The maintenance of free ways is also among the responsibilities of the organization.

Iran’s international land borders are currently as follows:

Bazargan, Sero, Astara, Bile Savar, Inche-Boroun, Bajgiran, Lotfabad, Sarakhs, Khosravi, Jolfa, Noordooz, Mirjaveh and Taybad.

The land transportation fleet is equipped with some 236,000 vehicles that carry the 76 percent of the cargo and 24 percent of the passenger loads in the country.


The State Railways Company of the Islamic Republic of Iran is in charge of the operation and maintenance of the railroads in the country. It has a staff of about 30,000 people who work in the central headquarters and 13 other operational zones. The State Railways Company operates under the supervision of the Road and Transportation Ministry.

Iran has a total network of 6,500 km of railroads of which 140 km is electrified. Jolfa, Razi, Bandar Imam and Bandar Abbas are border points where commodities are being carried through railroads.

Iran’s railway network is equipped with about 500 locomotives of which 140 are operational, with 15,000 cargo and about 850 passenger wagons. About 23 million tons of cargo and 10,000 passengers are being transported by railroads annually.

Iran is connected through railroad to the Republic of Azarbaijan via Jolfa, to Turkmenistan through Sarakhs, to Turkey via Razi and to Pakistan through Mirjaveh. Extension of Iran’s railroad network to Bandar Imam, Bandar Abbas and Khorramshahr port city connects the state railways network to the international shipping lines.


There are over 28 domestic airports in the country that are operating round the clock with 7 international airports and 6 exclusive bases of the National Iranian Oil Company. These is also another airport in Tehran’s suburbs (Payam Airport), which is affiliated to the Ministry of Post, Telephone and Telegraph. Airports in Tehran, Isfahan, Shiraz, Mashhad, Tabriz, Bandar Abbas and Ahvaz are open to international traffic. A number of 8 million passengers inside and 1.7 million outside the country use the air transportation facilities annually.

Iran’s most expanded and the sole flag carrier is Iran Air (Homa) whose share in transportation of passengers in the Iranian calendar year 1377 (1998-99) was 5.8 million within and 1.4 million outside the country. Iran Air makes 65 international flights to 23 destinations in the world weekly. Major international fights are being made from Tehran airport as well as Isfahan, Shiraz, Mashhad, Tabriz, Bandar Abbas and Ahvaz airports.


The Lake Urmia is the main sea route for transportation of cargo and passenger in the East and West Azarbaijan provinces. However, the tourist attractions of the lake are much more important than its role in the sea transportation.

There are two major shipping lines in the Caspian Sea; the Baltic Sea-Volga-Caspian and the Black Sea-Volga-Caspian.

The Volga-Baltic Canal is open for five months in the hot season while Volgaden Canal is open to navigation for 7 months. The Caspian Sea plays a share of about 2 percent in the total international transportation of goods in the country.


The main routes are Bandar Abbas and Bandar Imam to Europe, Asia, America; Bandar Abbas to Dubai; Khorramshahr to Kuwait and Bushehr to Qatar.

Iran is also connected to Western Europe, the Mediterranean and Central Asia through combined land and sea transportation facilities.


The Ports and Shipping Organization operates under the supervision of Road and Transportation Ministry and is in charge of the administration of trade ports in the country. The head of the organization is a deputy road and transportation minister. The organization has a personnel of 6,000 who are operating in the organization’s branch offices in Bandar Imam, Bushehr, Bandar Abbas, Chabahar, Khorramshahr, Abadan, Anzali, Nowshahr, Urmia and its headquarters.

Administration of ports and marine installations, building and management of ports facilities, formulation of ports and marine regulations, administration of loading and unloading operations, installation of navigation devices and inspection of ships are among various responsibilities of the organization.


  1. Transportation services play a significant role in meeting demands of people and their travel both inside and outside the country. Those transportation services that embody the entire population are of government nature.
  2. Transportation services highly influence the country’s economy, as they should meet public demands and help in distribution of industrial products.
  3. Establishments such as airports, ports, railroads and international terminals for foreign trade are vitally important for the preservation of relations with foreign countries and are being assessed as important means in the foreign policy of every country.
  4. Some transportation services demand heavy costs and are in need of constant updating on the basis of modern technology.
  5. Transportation services are being rendered through various mediums such as ports, shipping, airlines, airports, railroads, forwarding companies, warehouses companies, buses and taxis.



Transportation services are mainly handled by the private sector in many economically developed countries. Although interference of the public sector is necessary for offering better constant services, however, government’s supervision should be conducted in the following areas:

Compilation of the general transportation policies of the state
Guaranteeing reliable constant services
Keeping prices at suitable level
Guaranteeing security and quality of transportation services
Coordination of transportation services
Technological progress in transportation area
Compilation of transportation regulations
Supervision and promotion of transportation jobs
Pooling transportation data and information
Caring for international transportation relations
Formulation of technical standards in transportation field


Cited from: Malek-Reza Malekpour, Privatization and Structure of Iran’s Transportation System, in: (last access: 22.06.2016)