ECONOMIC OPPORTUNITIES AND CHALLENGES OF A RAILWAY CONNECTING RUSSIA AND THE REPUBLIC OF KOREA THROUGH THE DPRK

ABSTRACT

This article examines the economic potential of the railway construction project that will connect the Russian Federation and the Republic of Korea through the territory of the Democratic People’s Republic of Korea. The article analyzes how this project can facilitate trade, diversify transport routes, and attract investment. This would contribute to regional logistics development and the socio-economic growth of the Russian Far East and Korean markets. Issues related to sanctions, infrastructure gaps, and technical differences are also addressed, and the conditions necessary for the successful implementation of the project are highlighted.

Keywords: Russia-ROK railway, DPRK transit, socio-economic development, trade, logistics, investment.

Introduction

The concept of building a railway that would connect the Russian Federation and the Republic of Korea (ROK) through the Democratic People's Republic of Korea (DPRK) has been discussed for many years. This could be an important step towards strengthening economic and transport links in Northeast Asia. The implementation of this project would directly connect the Korean Peninsula with the Eurasian railway network, including the Trans-Siberian Railway. This would open up new opportunities for the development of international trade, logistics and political cooperation.

However, despite the obvious advantages, the project faces a number of challenges. The complexities associated with geopolitical tensions, sanctions, outdated infrastructure and differences in technical standards of railway systems make its implementation a difficult task.

The purpose of this article is to analyze the economic prospects for the construction of a railway link between the Russian Federation and the Republic of Korea through the territory of the DPRK, taking into account political and technical aspects as key factors limiting the implementation of this project.

1. Economic benefits for the Republic of Korea. For the Republic of Korea, the railway line passing through the territory of the DPRK is important for the development of international economic relations and transport routes [4, p. 69]. The ROK economy is primarily dependent on maritime transportation, which, while economically beneficial for the transportation of bulk cargo, is still subject to geopolitical risks and disruptions in global supply chains. Seoul is exploring the possibility of direct rail links to Eurasian and European markets via Russia as a strategic complement to existing sea routes.

In the period from 2017 to 2022, under President Moon Jae-in, the so-called "New Northern Policy" was implemented. This policy aimed to develop land transport corridors connecting the Korean Peninsula with Russia, Central Asia, and Europe. At that time, the development of these corridors was considered one of the most important tools for diversifying the ROK's foreign economic relations. Although by 2025-2026 this policy is no longer an official government strategy, the underlying logic of Eurasian transport connectivity established under it remains analytically significant.

2. Economic benefits for the Russian Federation. This project is also of great importance for the Russian Federation. It can contribute to the expansion of the country's transit potential in Eurasia, increase the efficiency of using the Trans-Siberian Railway [2, p. 86] and the socio-economic development of the Russian Far East. Attracting ROK cargo and investments in transport infrastructure is in line with Russia's long-term vision of turning its eastern regions into key logistics hubs connecting Asia and Europe. In this context, the Hasan-Rajin joint project between Russia and the DPRK is often seen as a prototype of such cooperation [3, p. 8]. It illustrates the technical feasibility of transit while highlighting the institutional and political barriers that need to be overcome.

3. Economic benefits for the Democratic People’s Republic of Korea. The railway construction project in the Democratic People's Republic of Korea presents a significant opportunity for economic development. As a key link between the Russian Federation and the Republic of Korea, the DPRK can benefit from transit fees and tariffs. Integration into the regional railway network will provide the DPRK with the opportunity to attract foreign investment to modernize its infrastructure, including tracks, stations, and logistics hubs. These investments will create new jobs in the construction, logistics, and transportation industries, which in turn will contribute to increased employment and professional development. In addition, the improved railway infrastructure will increase the efficiency of domestic freight transportation and stimulate economic activity in the regional centers of the DPRK.

4. Political and regulatory risks. In 2018, experts from the ROK visited the DPRK to assess the condition of the railway system and explore opportunities for its modernization. This visit was a clear demonstration of practical efforts to develop cooperation in the field of railway transport. However, even this modest undertaking led to significant diplomatic complications. The inspection required special permission from the United States, as any shipments of fuel, equipment, or personnel were subject to sanctions imposed on the DPRK. This example shows that even technical cooperation in the field of transport can be limited by global political factors.

However, on the Korean Peninsula, cooperation in the field of railway transport could serve as a practical tool for dialogue between the DPRK and the ROK. This would pave the way for a transition from purely political relations to economic cooperation

5. Technical challenges. One of the significant obstacles to the implementation of the railway project is the technological disparity between the railway systems of the participating countries. Russia uses a wide gauge of 1,520 millimeters, while the ROK uses a standard gauge of 1,435 millimeters. The DPRK has historically used the standard gauge, albeit with some exceptions and outdated sections. Due to the difference in track widths, it is necessary to build transshipment terminals, implement trolley replacement systems, or lay parallel tracks. This significantly increases the cost of the project and complicates its implementation. Although similar technical solutions are being successfully implemented on other international routes, they are becoming an additional risk factor in conditions of political instability and limited funding.

Another important issue is the state of the railway network in the DPRK. The railway tracks are in disrepair, the power supply is intermittent, and the alarm and traffic control systems do not meet international standards. Large-scale modernization of the network requires significant investments and long-term cooperation with foreign partners, which is a difficult task under the current sanctions. In addition, the lack of a transparent institutional framework in the DPRK increases risks for investors and reduces the attractiveness of projects for private capital.

6. Market and investment prospects. From an economic point of view, there is uncertainty about the volume of goods that can be transported. Maritime transportation still plays a crucial role in trade between East Asia and Europe, while the rail route can only be competitive for certain types of goods. Because of the speed and reliability of deliveries it provides, railway transportation is starting to compete with shipment by sea (advantage of speed) and air (advantage of cost) [1, p. 2]. However, without a unified tariff policy and guaranteed demand, the railway corridor may remain more of a symbolic project than a financially viable one.

A study of possible traffic flows shows that a railway connection between the ROK and the Russian Federation can be economically beneficial, especially for the transportation of goods with high added value. These products include advanced industrial products from the ROK, such as electronic devices, semiconductors, industrial equipment, and manufacturing components. In such cases, the promptness of delivery and the reliability of the logistics network are of paramount importance. Rail transportation may also be an acceptable option for transporting cars and automotive components, as the ROK is a major exporter of vehicles and has strict cargo safety standards.

Conclusion

Thus, the construction of a railway connecting the Russian Federation and the ROK through the territory of the DPRK is a multifaceted project that opens up both economic opportunities and political obstacles. For the ROK, this project provides a chance to expand its logistics network and strengthen its position in Eurasia. For Russia, this is an opportunity to increase transit traffic and contribute to the development of the Far East. In addition, this project can improve inter-Korean relations, as it serves as a platform for practical cooperation. The success of this initiative largely depends on factors such as the easing of sanctions, the strengthening of political stability on the Korean Peninsula, the development of transport infrastructure in the DPRK, and the resolution of technical problems related to the discrepancy in the width of the railway track.

In the present context, this project should be considered as a long-term strategic undertaking, the implementation of which depends on significant changes in the political landscape at both the regional and global levels.

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