Nearly three quarters of all rail freight transportation is being carried out below the cost price in Kazakhstan. As a result, the country awaits more but much-expected tariff hikes over the next three years.

The country’s vice prime minister Roman Sklyar announced that the tariff hikes will take place as part of an “improvement of the tariff policy in the rail freight sector”. The stated goal is to make rail freight financially viable, as it is a largely loss-making business now. Sklyar said that 73 per cent of all rail freight is being carried out below the cost price.

By exactly how much the tariff will grow remains up in the air, but Sklyar indicated that the hikes would be implemented gradually. In April, Kazakh Railways requested a tariff raise of over 20 per cent.

Business protest

In March, businesses and politicians protested the frequent tariff hikes in Kazakhstan. There are concerns for the competitiveness of Kazakh business, which profits from the currently low tariffs. “We need to point out that our tariffs are approximately twice as low as in neighbouring countries”, transport minister Roman Sklyar stressed in June in defence of raising the tariffs.