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Feasibility of establishment of “Dry Ports” in the developing countries—the

case of Iran

Article in Journal of Transportation Security · March 2011

DOI: 10.1007/s12198-010-0056-x

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J Transp Secur
DOI 10.1007/s12198-010-0056-x

Feasibility of establishment of “Dry Ports”

in the developing countries—the case of Iran

Ehsan Dadvar & S. R. Seyedalizadeh Ganji &

Mohammad Tanzifi

Received: 26 July 2010 / Accepted: 13 September 2010

# Springer Science+Business Media, LLC 2010

Abstract The main purpose of this research is to evaluate potential benefits and
impacts of Dry ports for different kinds of stakeholders, which may lead to establish
“Dry ports”. Dry ports are intermodal inland terminals which have been established
in several countries. In this paper, we designed a methodological approach with
these steps: a) Comprehensive literature review, b) Definition of “Base Case” for Dry
ports with required features, c) Comparative study and analysis, d) Questionnaires, e)
Analysis of answered questionnaires, and f) SWOT matrix. By means of this
framework, dry ports, intermodal transportation and containerization are investigated
through experts’ point of views. Iran is chosen as a case study, as a developing country.
This study is based upon yearly information and statistics of the country.

Keywords Dry port . Inland terminal . Intermodal transportation . Transportation

chain . Logistics centre . SWOT analysis . Questionnaire analysis

Introduction

In the middle of 1950s, container was introduced into freight transportation and it
has had revolutionary effect on international economy and trade since then and
within the last 20 years the rate of container utilization has been increased. It became
doubled from 1990 to 1998 and reached 175.000.000 TEU (Ioannou and Chassiakos

E. Dadvar (*) : M. Tanzifi

Department of Transportation Engineering, South Tehran Branch, Islamic Azad University, Tehran,
Iran
e-mail: ehsan.dadvar@gmail.com

S. R. S. Ganji (*)
Department of Transportation Engineering, Science and Research Branch, Islamic Azad University,
Tehran, Iran
e-mail: r.alizadehganji@gmail.com
 E. Dadvar et al.

2002). This rate is still increasing. According to the increment of capacity and size of
container ships which nowadays can carry on more than 12.000–15.000 TEU, and
the continuous growth of container transportation in the entire world, there are
critical needs to manage and handle properly with so much freight which are carried
to the seaports, loaded or unloaded and at last forwarded or received to/from main
destinations or origins. As maritime containerized transport continues to increase,
functional seaport inland access is important for the efficiency of the transportation
chain as a whole. Inland intermodal terminals are important nodes in the transport
network and have attracted considerable attention (Roso 2007). Lack of space at
seaport terminals and growing congestion on the access routes serving their
terminals are the main problems seaports face today, as container transport volume
continues to grow. The potential growth of container flows is modelled and
simulated by Parola and Sciomachen (Parola and Sciomachen 2005) and their
findings show that the modal imbalance results in increased road traffic congestion,
since a growth in the sea flow implies an almost proportional increase in the road
flow. According to the authors, the strategic decision would be the implementation
of rail or improved inland intermodal terminals serving seaports (Roso and Lumsden
2009). One of the feasible and successful solutions is “Dry Ports” or “Inland Ports”.

Literature review

The lack of studies and investigations in Persian literature, we performed such

comprehensive studies on international documents including papers, reports and a
handbook. Although the handbook is published in 1991 it can still be looked as a
comprehensive reference in term of definitions, general characteristics, potential
benefits, modelling and location analysis, impacts of dry ports, design and layout,
and at last operation and management of them. A report titled “Organisation of
Swedish dry port terminals” is also a valuable document published in 2006 and
includes dry port classification based upon the distance from seaports. In one of its
sections an analysis is performed by means of questionnaires. Also in a report of IBI
Group (2006) titled “Inland Container Terminal Analysis”, 3 different kinds of
classifications have been defined based on: modal orientation (marine, air, and rail),
distance from seaport (distant, midrange, and short), and principal traffic (expansion
of existing system, exports, and imports). Some different terms and definitions are
considered by Iannone et al. (2007) and in the report titled “Logistics Sector
Development, Planning models for Enterprises & Logistics Clusters” by UNESCAP
(2008) which are “Inland Port” (preferred in North America) and “Dry Port”
(preferred in many other parts of the world), based on the number of mentions of
each term in the search engines of Google and of Lloyd’s List, the specialist shipping
newspaper, inland port appears to be the more common term (UNESCAP 2008).
There are too many case studies in the report of Tioga Group (2006) in various
countries which describe various types of inland ports and also in the report of
“South Florida Inland Port Feasibility Study” (Cambridge and Inc 2007), too. In the
feasibility study performed by FDT (2007) and in the paper of “Research on Dry
Port concept as intermodal node” (Jarzemskis and Vasiliauskas 2007) an analysis
performed upon experts’ opinions related to dry ports and evaluation of infra-
Feasibility of establishment of “Dry Ports”

structures and problems according to specific situation of each country or region by

means of questionnaires. In the paper of the “Falkoping terminal” (Roso and
Lumsden 2009) and a Persian report titled “Solutions for increment rail transport
from seaports” (2008), SWOT1 analysis is performed to analyze dry ports. SWOT
analysis is a tool for understanding strengths and weaknesses for a project or
company and for finding opportunities and threats the one might face. However, one
has to be realistic and face any objectionable truths (Chang and Huang 2006). To
perform SWOT analysis, certain questions regarding strengths, weaknesses,
opportunities and threats should be answered. Questions regarding strength and
weakness should be considered from an internal perspective, and from the point of
view of the customers, i.e. those using the terminal’s services as well as in relation to
the competitors (Roso and Lumsden 2009).

Problem description

The container throughput of Shahid Rajaie port, as the biggest container port of Iran,
reached 2.200.000 TEU in 2009 and it ranked as the 60th container port in the world
[www.cargosystems.net]. According to this growth rate in recent years and various
estimations, along with physical expansions of container terminals in pre-defined
phases (3.000.000 TEUs for the first finished phase and expected 5 to 6.5 millions
TEU for the second ongoing phase (Domestic Various Related Statistics and
Information 2006–2008)) will result in the growth of inland container transportation.
Figure 1 illustrates some parts of T2 container terminal in this port
Due to long time period of storing containers in this port in comparison to the
standard time periods (27 days instead of 3–5 days (Domestic Various Related
Statistics and Information 2006–2008)) and regarding the conventional inland
container transportation in Iran, handled with road vehicles almost more than 90%,
(which is usually performed in a single-way), as well as more fuel consumption, air
pollution, noises, accidents and road congestion which are almost the main problems
in the developing countries for inland container transportation, one of the successful
solutions with so many experiments all around the world is implementation of dry
port or “Inland Logistics Port”. In this paper, we have introduced this concept, and
investigated its feasibility, main characteristics, requirements and obstacles.

Methodology

We designed a methodological approach, which begins with a comprehensive

literature review. We studied different documents, reports and also some interviews
to touch the dry port concept, its features and requirements, and then we distributed
questionnaires among several experts to analyze dry port implementation. Then
according to many case studies, we determined a “Base Case” for dry ports and we
performed our comparative study upon its basis. We summarized the results in a
SWOT matrix format. The different steps of our methodology are shown in Figure 2.

1
Strengths, Weaknesses, Opportunities, and Threats (SWOT)
 E. Dadvar et al.

Figure 1 T2 container terminal in Shahid Rajaie Port

Dry port concept

The main problems seaports face today, due to growing containerised transport, are lack
of space or inappropriate inland access set in a conventional way. Conventional hinterland
transport is based upon numerous links by road and a few by rail (Roso et al. 2006).
There are some denotations for dry ports:
“A Dry Port is an inland intermodal terminal directly connected to a seaport,
with high capacity of traffic modes, where customers can leave/collect their
goods in intermodal loading units, as if directly to the seaport (Roso et al.
2006).”
Or
“Dry ports are located inland from seaports but are linked directly to the
seaport(s) or, in the case of international land movements, are in contact with
the sources of imports and destination of exports. Dry ports may be used
whether a country has seaports or is land-locked, but only surface modes of
transport are involved in giving access to them (UNCTAD 1991).”

Comprehensive literature review

Questionnaires Determination of "Base Case"

Analysis of answered questionnaires Comparative study and analysis

SWOT matrix analysis

Figure 2 Proposed methodology

Feasibility of establishment of “Dry Ports”

Dry port classification

One of the main classifications of dry ports can be done based upon the function and
location of them as mentioned before in literature review. They can be categorized as
distant, midrange, and close dry port. In Figure 3 all categories of dry ports has been
shown in comparison with conventional hinterland transport.

Dry port benefits

The main potential benefits of dry ports maybe summarised as follows (FDT 2007;
UNCTAD 1991):
◦ Increased trade flows,
◦ Expanding existing seaport capacity,
◦ Lower door-to-door freight rates,
◦ Reducing total transport expenses,
◦ Optimal use of road and rail transport,
◦ Better utilization of capacity,
◦ Greater use of containers,
◦ Benefits of shuttle trains, and
◦ Reducing environmental problems and air pollution.

Figure 3 Comparison between conventional hinterland transport and an implemented 3 types of dry port
concept (Roso et al. 2006)
 E. Dadvar et al.

Questionnaires analysis

As mentioned before, we used questionnaires to analyze recent dry ports

implementation in Iran. This method has been used in several other studies, too.
Two comprehensive questionnaires were designed and distributed among 84 related
experts. 51 persons answered them back indicating 61% contribution, in comparison
to 31% contribution in the paper by Jarzemskis & Vasiliauskas (2007), it is a good
contribution and maybe it means that Iranian related experts were more interested to
know about such new phenomena.
The people whom we selected to answer the questionnaires were chosen from
different parts of transportation which included related departments in port &
maritime organization of Iran, national railway company, road transportation
organization, some shipping lines and so on. 75% of them were as public sector
occupants and rest in private sectors. Background of respondents is illustrated in
Figure 4 and the educational degrees were B.A. 52%, M.Sc. 38% and Ph.D. 10%.
According to this information they were relatively well-educated experts with
enough background.
Due to broad field of dry port feasibility study, in this paper we just considered 4
different topics.

Necessity of dry ports and development of container transportation in Iran

Respecting Figure 5, the necessity of dry ports in Iran is “High”. On the other hand,
growth rate of containerized freights and container transportation throughput of
Shahid Rajaie port, both estimated “High”, too. Thus paying attention to the
development of required infrastructures is necessary.

Dry port implementation impacts

The most important impacts and benefits which may occur are:
◦ Reduction in road traffic congestion and development of rail transportation (as
illustrated in Figure 6),
◦ Increment of employment, and
◦ Removing irrelevant operations from seaports.

Figure 4 Respondents’ More than 30

background (years) 9%
Under 10
20 to 30 29%
14%

10 to 20
48%
Feasibility of establishment of “Dry Ports”

Figure 5 Necessity of dry Too Low

ports in Iran 0%
Too High Low
10% 12%
Mid
18%

High
60%

Dry port implementation challenges and impediments

Regarding the respondents’ ideas, the main impediments of dry port implementation
in Iran are:
◦ Inconsistency among several different but exactly related sectors and organizations
(as illustrated in Figure 7),
◦ Changes in governmental policies and decisions,
◦ Bureaucracy, and
◦ Interfering of benefits of different parts of transportation chain.

Dry port features

In respondents’ opinions, the most important functions that must be presented as

essentials are:
◦ Freight distributing,
◦ Container storing, and
◦ Custom clearance.
From the location aspect, the results are illustrated in Figure 8. Although so
many of respondents believed that the accurate location of dry ports must be

Figure 6 Amount of road Too Low

traffic and congestion reduction 0% Low
and development of rail Too High
transportation by means 20% 10%
of dry ports
Mid
24%

High
46%
 E. Dadvar et al.

Figure 7 Inconsistency among Too Low

several different sectors Low
0%
and organizations 2% Mid
Too High 17%
36%

High
45%

determined by means of economical analysis and models, locating methods, and

feasibility studies.
From the ownership aspect, respondents’ opinions were private sector ownership
52%, public sector ownership 13% and a combined one 35%. From the management
aspect, they considered private sector 69% and a combined management 31%. It is
considerable that nobody accepted mere public sector management.

Comparative analysis

In this section, we first determined the “Base Case” for a dry port by means of
comprehensive case studies which we had, secondly, we took a brief look on
domestic experiments and finally, we studied some aspects of related fields to dry
ports implementation and required infrastructures in Iran as a developing country.

Determination of “Base Case”

Nowadays there are so many dry ports in several countries which have an important
role in improvement and development of container transportation and strengthening
of logistics. There are different types of dry ports in Australia, Belgium, Cambodia,
Canada, Czech Republic, Denmark, Finland, France, Germany, Ghana, Italy, Kenya,

Figure 8 Proper location Close

for dry port implementation Distant 21%
in Iran
31%

Midrange
48%
Feasibility of establishment of “Dry Ports”

Pakistan, Spain, Swaziland, Sweden, Tanzania, UAE, UK, and USA. One of the
main benefits of dry ports is the possibility of having access to marine transportation
for the land-locked countries, for example there are some plans for developing a dry
port in Lesotho.
Based on different case studies, the most important structural and functional
features of a sample dry port as “Base case” are:
◦ Inland intermodal terminal (at least 2 different modes of transportation) and
different distances from seaport(s),
◦ Shuttle rail connection with seaport(s) (at least once per day),
◦ Appropriate access to origins and destinations of main nodes of freights,
◦ Handling equipment for different types of containers,
◦ Customs clearance and control,
◦ Intermodal container transportation services with required bills of lading,
◦ Causing to lower transportation time and cost (even in such as very short distances
(Roso 2008)),
◦ Ownership and management are usually assigned to seaports, public and private
rail companies, municipalities of adjacent cities,
◦ Some other value-added services, and
◦ Adequate marketing in its region.

Domestic experiments

There is not any active “Dry Port” in Iran. Albeit Iranian National Railway Company
owns 3 intermodal stations which could be used as intermodal nodes between rail
and road modes (Domestic Various Related Statistics and Information 2006–2008).
These stations are shown in Figure 9.

Aprin terminal

This railway station is located 21 km south-west of Tehran (the capital of Iran) and it
is at an appropriate position of north-south and east-west corridors of railway
network. This site is also accessible by several national highways. The site area is
about 700 ha and the former planned projects aimed to construct 110 storage blocks
on it. If this site is activated as a dry port, it might serve Tehran, industrial zones
surroundings as well as the north of country. But the main problems and
impediments of this around 30 years continuous-unsuccessful project are customs
clearance, poor railway services, networks, fees and so on (Domestic Various
Related Statistics and Information 2006–2008).

Shahid Motahhari terminal

This terminal is located at 36 km south of the city of Mashhad in the north-east

of Iran. The site also has an access to the national highway. Its area is about
190 ha and there are required facilities to handle container transport needs. This
terminal is managed by private sector (Domestic Various Related Statistics and
Information 2006–2008).
 E. Dadvar et al.

Figure 9 Three intermodal terminals in Iran

Sarakhs terminal

This terminal is located at 170 km north-east of city of Mashhad in the north-

east of Iran at Iran-Turkmenistan border. Its strategic position can be looked as
an important gate to the markets of some land-locked countries. The site is
also outfitted by required facilities (Domestic Various Related Statistics and
Information 2006–2008).

Statistics and information

One of the main characteristics in developed countries related to container

transportation is aggregate statistics and information data banks for several
periods but there is not such a suitable situation in Iran as a developing
country. Several different involved sectors have their own still poor data which
are the main and the most important impediment for further studies relied on
precise calculations. There is not a common unit between several different
sectors. Statistics and Information Centre of Iran customs just record containers
in those terminals with bonded warehouses. Transportation ministry just
considers ports throughput without any attention to the road and rail container
throughput. Ports and Maritime Organisation also just concentrates on ports and
there is no accurate information for origin/destination of containers in the
country. National railway company records numbers of wagons which handle
Feasibility of establishment of “Dry Ports”

containers or in a different manner overall tonnages of containers and there is

not separated statistics of TEU/FEU. Road transportation organisation just
records tonnages of containers and the number of trips of trucks which handle
containers. Iran Statistics Centre has just information related to the container
ships of Iran.
Respecting this various information, there is not any unified data to study and
monitor the container transportation exactly and also the origin/destination of their
commodities (Different interviews performed with several related experts 2009;
Domestic Various Related Statistics and Information 2006–2008).

Rail and road networks and infrastructures

With reference to comparative statistics, the situation of rail and road networks
are considered in Table 1. By paying attention to Table 1, it is clearly obvious
that there is not suitable rail network which is one of the most important factors
of implementation of dry ports in Iran. Improvement and expansion of both
rail and road networks must be considered in short/mid/long period national
projects.

Rail and road transportation time, cost and monitoring

There are also poorly recorded data about these topics. In the rail transportation,
there are to pre and end—road haulage which usually results in more time
consumption and also extra cost in comparison with still easier road direct
transportation. There is another critical problem in the majority of rail trips which
rail wagons still cannot handle 2 FEU together (i.e. the possibilities are 1 TEU+1
FEU or 3 TEU).
The average container trip time from Shahid Rajaie port to some different
destinations by means of rail and road transportation has been shown in Table 2. In
all routes, the situation of road transport is better than rail transportation.
In the monitoring process, rail transport references to www.rai.ir claims that it
is supposed to be updated every 20 minutes, however it does not seem to be
correct. Therefore there is not a reliable trip for customers. Furthermore, road
transport references to: www.itair.com seems to have a better situation. It is also
possible for customers to monitor their commodities by direct contact with truck
drivers.

Table 1 Comparative statistics of rail and road networks of Iran (Domestic Various Related Statistics and
Information 2006–2008).

Factor Value for Iran Position of Iran Average value

Rail total length/population (km/million) 127 78 of 102 303

Rail total length/area (km/1,000 km^2) 5.2 83 of 121 20
Road total length/population (km/million) 1034 75 of 102 3662
Road total length/area (km/1,000 km^2) 42 84 of 102 256
 E. Dadvar et al.

Table 2 Comparative trip time between rail and road transportation in Iran (Domestic Various Related
Statistics and Information 2006–2008).

Origin Destination Rail distance Rail trip time Road distance Road trip time
(km) (day) (km) (day)

Shahid Rajaie port Tehran 1,386 5 1,321 <3

Sarakhs 2,427 7 1,780 <5
Bafgh 633 2 975 <2
Isfahan 1,018 5 1,007 <2

Customs clearance problems

As we mentioned, the Aprin terminal has been faced so many regulation problems to
form as a dry port for 3 decades. One of the most important of them is customs
clearance problem. As we detailed in the “Base Case”, it is one of the most
important factors to transform a simple inland terminal into a dry port. But, because
of unconscious policies, this problem still remains as a major impediment for such a
suitable site like Aprin terminal (Different Interviews Performed with Several
Related Experts 2009).
On the other hand, some other customs clearance problems also exist for inland
customs stations. For example, although there is a bonded warehouse in Sirjan free
trade zone (where can be considered as a shadow port for Shahid Rajaie port in the
midrange distance in its hinterland) in Kerman province, there are not some special
commodities allowable to sent or receive, however, they are allowable in the border
stations. It seems there are critical needs to re-organize or re-regulate customs basic
rules (Different Interviews Performed With Several Related Experts 2009).

Potential markets

Besides the political issues and problems, Iran has a strategic position in the middle-
east. In comparison with such countries as Oman, Pakistan, Saudi Arabia and UAE,
some of which have better container throughput (e.g. Dubai and Sallaleh container
ports), Iran has better potential hinterland and markets. 12 out of the world’s 30 land-
locked countries are in the ESCAP region, 8 of which including Afghanistan,
Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and
Uzbekistan are accessible through Iran (UNESCAP 2008). Furthermore, Russia
and countries of north Europe can be considered as potential markets, too. So with
more concentration on transportation efficiencies such as dry ports, more
involvement and development will be achieved for Iran.

SWOT analysis

We performed a SWOT analysis to summarize potential positive and negative

impacts of dry port implementation generally in a developing country and
specifically in Iran.
Feasibility of establishment of “Dry Ports”

Table 3 SWOT analysis.

Strengths Weaknesses Opportunities Threats

Reduction of overall Inconsistency between Integrating port Overall economic

transportation cost decision makers in areas with cities crisis
national, regional and
local levels
Economies of scale in Inconsistency between Strengthening Possibly inconsistency
freight transportation several related multimodal between several
transportation sectors solutions different sectors
Elimination or Reductions of private Possible growth of Critical problems
reduction of empty sector to invest for commodities related to contra
containers movements facilities for long band
period projects
Improvement of Dependency to the freight New customers in Unable and
seaports communication traffic flows of a specific existing market inappropriate
in the logistics and seaport (Shahid Rajaie infrastructures to
transportation chains port as the most important achieve intermodal
container port of Iran) transportation needs
Avoidance of over Poor rail network New markets Lack of intermodal
storage, congestion and infrastructures transportation
and freight traffic companies
in seaports
Reduction of overall Strengthening governmental New services up to International
fuel consumption by role in rail transportation new markets prohibitions
means of better
transportation modes
Strengthening the ports Leakage of proper facilities New services for Increase in rail
in transport chains for container handling, seaport(s) up to maintenance cost
loading and unloading increment of markets
in railway terminals
Avoidance traffic Assignment of structural Potential markets Increase in cost for
bottlenecks budget to other sectors in land-locked rail infrastructure
countries, Russia development
and north of Europe
Reduction of air Policies for the Light reduction activity
pollution development of rail for road carrier from/
transportation to seaport(s)
Reduction local Removing irrelevant Monopolization of
environmental operations from private sector in
problems in the cities seaport(s) management
Improvement in rail Reduction of road
transportation network maintenance cost
Employment effects in Reduction of road
rail transportation accidents
Speeding up the Integrated
customs clearance management and
process development of
seaport(s)
Improvement of Reducing the use of
Security levels expensive areas in
the seaport(s)
 E. Dadvar et al.

We considered:
– Strengths: attributes of the dry port those are helpful to achieving the objective.
– Weaknesses: attributes of the dry port those are harmful to achieving the
objective.
– Opportunities: external conditions those are helpful to achieving the objective.
– Threats: external conditions which could do damage to the performance of dry
port.
The results are shown in Table 3.

Conclusion

Nowadays, majority of freight transportation handles with marine transportation. On

the other hand, containerized transport has a high growth ratio. According to seaport
expansions and bigger container ships, there are great flows of freights which enter
seaports and then inland routes. Dry port concept is a feasible solution to congestion
challenges of seaports and several problems of inland collection and distribution of
goods. It will also improve the rail transportation. One of the other main benefits is
better environmental situation.
Although dry port implementation could bring numerous benefits for the actors
who are involved, it should not be taken for granted since it depends very much on
existing and future infrastructure, institutional systems, regulations and customers’
attitude.
According to our findings by using the proposed methodology for Iran as a case
study and because of natural differences between transportation infrastructures in
Iran and almost all other dry ports or inland ports in Europe and America, such dry
ports using shuttle rail services between dry ports and sea ports cannot be chosen,
yet. But dry ports can be regarded as collection and/or distribution nodes of local
goods and may prevent increase of total vehicle-Km in all cases and also maybe the
establishment of these kinds of facilities will result in better global trade.
The contribution of this article is investigation of intermodal transportation and
containerization through experts’ point of views via questionnaires regarding the
most important characteristics of feasibility of establishment of dry ports. Moreover
a comparative study and analysis of dry ports has been performed by means of
yearly information and statistics of Iran and a SWOT analysis performed to
summarize conclusions. Practical implication of this paper is to identify the main
strengths, weaknesses, opportunities and threats of transportation, trade, and
economy infrastructures related to establishment an intermodal transportation
terminal with the main characteristics of dry port.

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