In the first half of 2023, Nigeria’s expenditure on servicing debt for loans obtained for the Nigeria Railway Modernisation Project (Idu Kaduna Section) and Nigeria Railway Modernisation Project (Lagos – Ibadan Section) exceeded revenue by 1,208.5%, totaling $38.59 million (N29.98 billion at N777/$). This analysis was based on debt service documents, indicating a significant financial challenge in sustaining the railway projects.
During the same period, total railway revenue amounted to N2.29 billion, as reported by the National Bureau of Statistics (NBS). Passenger traffic saw a 53.65% increase, with 441,725 passengers in the first quarter of 2023 compared to 953,099 in the corresponding quarter of 2022. However, revenues from passengers and cargo declined in Q1 2023 compared to the previous year.
In Q2 2023, passenger numbers rose to 474,117, and cargo volume increased to 56,029 tons. Despite these increases, the revenue generated from railway services remained modest. Factors such as insecurity and ticketing issues, including paper tickets, were attributed to the low revenue.
The House of Representatives expressed concern over low revenue generation from the Nigerian Railway Corporation, citing ticket racketeering as a significant challenge. The Managing Director of the NRC, Fidet Okhiria, acknowledged the issue during a recent session with the House of Representatives Committee on Finance. The Minister of Transportation, Saidu Alkali, emphasized that the introduction of e-ticketing would enhance revenue, improve security, and curb ticket racketeering.
Despite the challenges, the Federal Government aims to generate N7.01 billion from train passengers by 2025, as reported in a recent publication by The PUNCH. The implementation of e-ticketing is expected to contribute to achieving this revenue target and address existing issues in the railway sector.
