Etihad Rail lays tracks for economic growth, new investment opportunities
MAYS IBRAHIM (ABU DHABI)With its freight network now fully operational across all seven emirates and high-speed passenger service on track for launch by 2026, experts say Etihad Rail network is set to accelerate the UAE's post-oil growth and unlock fresh investment opportunities. Etihad Rail's freight network, launched in 2023, spans 900km from the Saudi border at Ghuweifat to the eastern port city of Fujairah.It connects key industrial and maritime nodes including Khalifa Port in Abu Dhabi, Jebel Ali in Dubai, and the Port of Fujairah, enabling a faster and more sustainable movement of goods across the country.The Etihad Rail passenger service will launch in 2026, linking 11 cities and regions across the UAE, including major hubs like Abu Dhabi, Dubai, Sharjah, and Fujairah. Trains will travel up to 200kmph, with a dedicated high-speed line between Abu Dhabi and Dubai expected to cut journey times to just 30 minutes.The UAE's transport and storage sector has played a key role in driving overall GDP growth in recent years, expanding by 9.6% in the past year, according to Daniel Richards, MENA Economist at Emirates NBD.
'On the back of this growth, it accounted for 5.2% of total output last year, up from 4.2% in 2021. Much of this is on the back of aviation but all transport modes have contributed, and the launch of the completed rail service will provide another major boost to the sector. It will also help facilitate growth in the broader economy,' he told Aletihad . The enhanced freight transport capabilities offered by the railway will also bolster the UAE's long-term industrial development goals, including Operation 300bn, which aims to increase the industrial sector's economic contribution to Dh300 billion by 2031, Richards added. 'Phase one of the railway has already contributed to the expansion of ADNOC's operations at the Shah sour gas field. An effective rail network, well connected to the country's bulk cargo shipping facilities and coastal processing plants, will support the ongoing growth in the heavy industry. The intermodal connectivity can also support the planned development of domestic manufacturing,' he said. Continued investment in the UAE's infrastructure sector will reinforce its appeal as a prime destination for investment and business, added Richards.'The fully launched rail network should encourage greater private and foreign investment in the country. It also adds to the attractiveness of the existing warehousing facilities and transshipment ports like Jebel Ali,' he said. The UAE currently outperforms its GCC neighbours on nearly all transport metrics measured by the World Economic Forum, according to Richards. 'As the sector develops at a faster rate, the nascent rail network will also help bolster the UAE's position relative to its regional peers as regional competition in some areas intensifies,' he said.
Real Estate Ripple Effect Investors are already eyeing the real estate potential emerging around the railway. Martin Kocher, a partner at Abu Dhabi-based Gravity Power Management Consultancies, noted that the improved connectivity will significantly influence property appreciation and stimulate investor interest, especially in areas that have historically been underserved or considered remote.
'Multiple studies confirm a clear correlation between high-speed rail (HSR) access and rising asset values,' he told Aletihad . 'In Fujairah specifically, I anticipate a 15% increase in property values within the city. All eyes will be on Al Hilal City, the flagship master-planned community anchored by the Etihad Rail station in Fujairah.'This rising attractiveness will also draw in local capital for property upgrades, generating jobs and stimulating grassroots economic activity, Kocher added. 'In parallel, smaller cities will benefit from increased domestic tourism, giving them a platform to showcase their unique identity. This not only drives foot traffic and spending but also strengthens appreciation for Emirati culture and national unity.'Kocher also predicted a healthy rebalancing of property prices across the country.'With improved inter-emirate mobility, citizens and residents now have the freedom to live in one emirate and work in another. This shift will allow more families to align their home location with lifestyle preferences and family priorities,' he explained. To maximise the benefits, Kocher advised developers to focus on high-density, mixed-use developments near stations that combine housing, retail, and public services.
'Incorporating retail outlets or a small mall will create healthy commercial diversity and support local businesses,' he said. 'A strong residential offering and a thriving small business ecosystem will continue to reinforce each of the emirates' appeal to both residents and long-term investors.'
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