Nigeria’s rail transport sector is facing renewed scrutiny following a sharp contraction in its contribution to the country’s Gross Domestic Product, raising concerns about safety, infrastructure reliability, and long-term sustainability.
Fresh economic data has revealed that the downturn in rail performance comes at a time when other transport segments are expanding rapidly, further exposing structural weaknesses within the system.
NRC’s GDP contribution falls to -2.8% amid train incidents
Latest figures show that NRC’s GDP contribution falls to -2.8% amid train incidents, marking a dramatic reversal from the strong growth recorded in the previous year.
Data from the fourth quarter 2025 GDP report indicates that the rail transport and pipelines segment contracted by -2.835 per cent, compared to a remarkable 42.576 per cent growth in the corresponding period of 2024.
This steep decline underscores the growing challenges facing the Nigeria Railway Corporation, particularly as operational disruptions and safety concerns continue to affect passenger confidence and service delivery.
Transport sector growth masks rail decline
Despite the downturn in rail performance, Nigeria’s broader transportation and storage sector recorded a robust growth of 21.254 per cent in Q4 2025, up from 13.209 per cent in the same period of 2024.
The growth was largely driven by improvements in road, air, and water transport systems.
Road transport, which remains the dominant mode for moving goods and passengers, expanded significantly to 23.86 per cent, while air transport rebounded to 15.17 per cent growth after recording a contraction in 2024.
Similarly, water transport posted a 16.09 per cent increase, reflecting a gradual shift by businesses and commuters toward alternative logistics channels to avoid congestion and inefficiencies on roads.
However, the stark contrast reinforces the reality that NRC’s GDP contribution falls to -2.8% amid train incidents, positioning rail as the weakest link within Nigeria’s transport ecosystem.
Derailments and operational disruptions
The decline in performance has been closely linked to a series of train derailments and service interruptions recorded across key rail corridors in 2025.
One of the most notable incidents occurred on the Abuja–Kaduna rail line, one of Nigeria’s busiest passenger routes. Operations were temporarily suspended after a train derailed shortly after departure, prompting safety investigations and emergency response measures.
The incident, which occurred near Asham Station, resulted in injuries to several passengers and raised fresh concerns about infrastructure integrity and maintenance standards.
Barely months later, another derailment was recorded on the Warri–Itakpe corridor, where two coaches of a passenger train left the tracks near Agbor in Delta State.
Although no fatalities were reported, the disruption forced another suspension of services and further eroded public confidence in rail transport.
Industry data suggests that Nigeria’s rail network has experienced over 100 derailments in the past six years, highlighting deep-rooted challenges in track maintenance, security, and operational oversight.
These recurring incidents have played a significant role in the reality that NRC’s GDP contribution falls to -2.8% amid train incidents, as disruptions directly impact passenger volume and revenue generation.
Calls for privatisation and reform
In response to the ongoing challenges, stakeholders have intensified calls for structural reforms within the rail sector.
Experts argue that opening up the industry to private sector participation could significantly improve efficiency, introduce modern technology, and enhance service quality.
Aviation and transport analyst, Olumide Ohunayo, has advocated for the privatisation of rail operations, noting that private investment could drive innovation in ticketing systems, infrastructure maintenance, and operational management.
Similarly, retired aviation expert John Ojikutu has proposed a hybrid model where the government retains ownership of rail infrastructure while allowing private operators to run train services.
According to him, such a model would ease the financial burden on government while fostering competition and efficiency within the sector.
Infrastructure and security concerns
Beyond operational inefficiencies, infrastructure and security challenges remain critical issues affecting rail performance.
Preliminary investigations into recent derailments have pointed to possible track vandalism and technical faults, both of which highlight vulnerabilities in the system.
Analysts note that without significant investment in modern rail infrastructure, surveillance systems, and routine maintenance, the sector may continue to struggle to achieve sustainable growth.
The situation further reinforces why NRC’s GDP contribution falls to -2.8% amid train incidents, as persistent infrastructure failures limit the sector’s ability to operate at optimal capacity.
Economic implications
The contraction in rail GDP contribution has broader implications for Nigeria’s economy, particularly in the areas of logistics, trade, and regional connectivity.
Rail transport is widely regarded as a cost-effective and efficient means of moving bulk goods over long distances. A weak rail system increases reliance on road transport, which is more expensive and contributes to traffic congestion and road deterioration.
Experts warn that unless urgent reforms are implemented, Nigeria risks missing out on the economic benefits of a functional rail network, including reduced logistics costs, improved trade efficiency, and enhanced regional integration.
Outlook for the rail sector
As NRC’s GDP contribution falls to -2.8% amid train incidents, the focus is now on policy responses and investment strategies that can reverse the trend.
The Federal Government is expected to prioritise safety upgrades, infrastructure rehabilitation, and regulatory reforms to restore confidence in the system.
Stakeholders emphasise that a combination of public investment and private sector participation will be critical to unlocking the full potential of Nigeria’s rail transport sector.
If effectively addressed, the current challenges could serve as a turning point, paving the way for a more resilient, efficient, and competitive rail system that contributes meaningfully to national economic growth.
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