Bahrain’s transport sector is pivotal in the island kingdom’s economic landscape, driving trade and commerce, logistical connectivity and tourism growth. The strategic location of Bahrain in the heart of the GCC has historically positioned the country as a critical hub for regional trade. In 2023 the sector witnessed significant development, bolstered by robust government support, rising private sector participation and a raft of project announcements. This progress is underpinned by a government-led $30bn plan to revitalise and expand the kingdom’s air, maritime, rail, road and urban connectivity, both internally, and at a regional and international scale.
Transport has played a key part in Bahrain’s post-pandemic economic recovery efforts. In 2023 the transport and communication sector accounted for 7.4% of real GDP, which represents 3.1% growth in gross value added over 2022, according to Bahrain Economic Report 2023, issued by the Ministry of Finance and National Economy. Major forthcoming projects look to drive continued growth in the sector. These include the Bahrain Metro, the ongoing modernisation of Khalifa Bin Salman Port (KBSP), land reclamation projects set to expand the country’s landmass by 60%, as well as extensive new road and rail links to Saudi Arabia and other regional destinations.
Structure & Oversight
The Ministry of Transportation and Telecommunications (MTT) oversees the sector, implements policy and regulations, and manages the development of transport and some aspects of logistics infrastructure across the kingdom. The MTT’s mandate extends across all modes of transport – including air, land and sea. The ministry is organised into specialised divisions which oversee different components of the industry.
Roads Affairs within the Ministry of Works (MoW) is responsible for developing strategic road projects that improve connectivity and reduce congestion, while the Land Transport Affairs ensures compliance with safety standards, manages licensing, and provides and promotes efficient public transport services.
Maritime transport is becoming an increasingly significant component of Bahrain’s trade and logistics framework. The segment falls under the jurisdiction of the Ports and Maritime Affairs (PMA), which is tasked with regulating port activities, enhancing port infrastructure and ensuring maritime safety and security. KBSP, Bahrain’s primary commercial port, serves as a key node in the kingdom’s economic infrastructure and the larger GCC supply chain.
Situated in the Salman Industrial City, 13 km from the capital Manama and 13 km south-east of Bahrain International Airport (BIA), KBSP is managed by Danish logistics giant APM Terminals. Another key component of the kingdom’s ongoing push into the logistics segment is the development of the Bahrain’s Sea-To-Air Logistics Hub – linking the port to BIA.
In the aviation sector, Civil Aviation Affairs (CAA) is responsible for regulating and supervising all aspects of air travel and air cargo transport in the kingdom. The completion of the $1.1bn passenger terminal at BIA in 2021 increased capacity for 14m passengers annually and marks a notable milestone for Bahrain. Further, it underscores Bahrain’s commitment to improving its aviation infrastructure to support increased passenger and cargo traffic. Other government entities that are involved in various aspects of transport sector regulation and oversight include the Customs Affairs and General Directorate of Traffic.
Development Strategy
Bahrain’s transport sector development strategy is intricately aligned with the kingdom’s broader economic ambitions under both Bahrain Economic Vision 2030 and the 2050 updated version of the economic vision (though at the time of writing the latter document is still under development). Broadly, the strategy aims to transform the country’s transport infrastructure into a modern, efficient and sustainable system that bolsters economic growth, enhances connectivity, and elevates the quality of life for residents and tourists alike – the latter of whom are a key focus (see Tourism chapter).
The MTT has placed a priority on growing logistics connectivity in recent years, as described in the Logistics Services Sector Strategy 2022-26. This plan provides a detailed roadmap for developing cargo links both internally – as in the case of the Sea-To-Air Logistics Hub – and across the region. The strategy’s objectives include increasing the sector’s GDP contribution to 10%, boosting port cargo handling to 1m twenty-foot equivalent units (TEUs) and ramping up air freight volume to 1m tonnes.
Bahrain ranked second in the Arab World and 34th globally on the World Bank’s Logistics Performance Index 2023. Indeed, the World Bank named the kingdom the most improving country in the GCC – which suggests that the Logistics Services Sector Strategy 2022-26 has already begun to bear fruit.
The kingdom is advancing environmental and economic sustainability within the sector, aligning with Bahrain Economic Vision 2030 goals. Key activities include promoting electric vehicles (EVs) and establishing a broad EV charging network to reduce carbon emissions and reliance on fossil fuels. The government has introduced incentives for EV adoption, reflecting its commitment to green transport.
Recent infrastructure construction projects have incorporated sustainable practices such as energy-efficient designs and the use of renewable energy sources. For example, the recent and ongoing expansions of BIA and KBSP include eco-friendly technologies to minimise environmental impact. These initiatives are key components of Bahrain’s National Energy Strategy – unveiled at the COP26 UN Conference on Climate Change in Glasgow, Scotland, and launched in November 2023 – which outline a roadmap to achieve climate commitments, in line with global sustainability goals.
Major Projects
In addition to the national blueprint, the sector has been buoyed by Bahrain’s post-pandemic Economic Recovery Plan (ERP), which was launched in 2021. Consisting of 22 large-scale infrastructure investment projects worth more than $30bn, the ERP – and its subsidiary development programme, the Strategic Projects Plan (SPP) – emphasises transport infrastructure as a key driver of economic revitalisation. Headline transport developments under the ERP include the creation of five new cities situated on newly constructed islands, which would increase the country’s land area by more than 60%; the 25-km, four-lane King Hamad Causeway linking Bahrain by road and rail to Saudi Arabia; a 109-km metro system, which will connect all major population centres in the country; a series of corollary projects to expand fibre-optic networks’ infrastructure and cloud-computing facilities; and the construction of major new sports, exhibition and tourism venues.
Since the ERP announcement, the government has made progress on several of these projects. Feasibility studies and preliminary designs have been completed for the $3.5bn King Hamad Causeway, which will be funded under a public-private partnership (PPP) model. International construction firms had begun bidding on the project by late 2023, and groundbreaking could begin as soon as late 2024. Meanwhile, by December 2024 the first phase of the proposed Bahrain Metro project was under review and has yet to commence.
Roads & Bridges
By the end of 2023 Bahrain’s road network consisted of 4622 km of paved roads – 25% of which had been built since 2019. Government expenditure on road projects totalled BD33.7m ($89.4m) in 2023, up from BD14.9m ($39.5m) in 2022, according to the MoW. In addition to other initiatives, the ministry has converted several major roundabouts in Manama into intersections controlled by traffic signals. This action aims to ease traffic congestion. According to ministry data, this change alone has reduced the average waiting time at intersections in the capital by 30% and increased main road capacity by 40%. Other major ongoing or recently completed road projects include expanding the Al Fateh Highway, widening the Al Janabiya Highway to accommodate three lanes in either direction, and converting a large portion of the Raya Highway into a dual carriageway.
Forthcoming road works include the Northern Link Road and the intersecting Busaiteen Link Road project, announced in 2021 as part of the SPP. The Northern Link project consists of a 22-km stretch of four-lane highway along the northern coast of Bahrain Island, with the aim of stimulating housing development in the area. The project will be developed under a PPP model. The first stage of bidding for the Northern Link Road – for a consultant to produce technical feasibility studies – was completed in late 2022.
In April 2024 Ebrahim bin Hassan Al Hawaj, the minister of works, announced that the ministry had recently launched a four-phase project to address heavy traffic in Manama and elsewhere across the kingdom. The MoW plan reportedly consists of 48 individual projects, including widening intersections, adding lanes to particularly busy roads and building new overpasses, plus more complex projects such as the integration of intelligent transport systems to optimise traffic flow and improve safety. The deployment of advanced traffic management technologies – including adaptive signal control and real-time traffic monitoring – is expected to enhance the efficiency of the road network by 15%, supporting Bahrain’s vision of becoming a regional logistics hub.
In terms of bridge developments beyond the King Hamad Causeway project (see analysis), the government has been urged by advisors to begin feasibility, environmental and technical studies on a possible 23-km causeway linking the Bahraini mainland to the Hawar Islands, in the Gulf of Bahrain. The multimillion-dinar project was announced in March 2021. Similarly, plans have moved forwards in recent years in an effort to revive the so-called Friendship Bridge between Bahrain and Qatar, which was announced in 2008. In November 2023 the $3bn project was resurrected as part of a series of talks between the two countries. By early 2024 representatives from both countries had met a number of times to discuss the project, and work on the bridge was moving forwards. Upon completion, it will reduce travel time between Bahrain and Qatar from five hours to 30 minutes.
Rail
The long-awaited GCC rail network has recently been relaunched after years of planning. Initially approved by member states in 2009, the 2177-km rail network is set to connect Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, with an estimated total cost of around $240bn. At the December 2021 GCC Summit, the project was revived by regional leaders, who approved the establishment of the GCC Railways Authority to oversee the project. Since then, Bahrain and other member states have undertaken feasibility studies related to the project. In a November 2023 meeting in Muscat, project leaders announced that the project would be operational – though likely not entirely completed – as early as December 2030.
Bahrain’s other major rail development is the estimated $2bn Bahrain Metro project, a key initiative in the kingdom’s infrastructure modernisation plan, The project consists of a 109-km urban rail network aimed at reducing traffic congestion and related environmental impacts. The first phase of the project will include 20 stations operating through two lines. The 13-km Red Line, comprising nine stops, will connect BIA to Seef District via Bahrain Financial Harbour. The 11-station Blue Line will connect Juffair to the educational area in Isa Town via the Manama central business district. The Red and Blue Lines will intersect at Bab Al Bahrain and Al Farooq stations.
Initially, the elevated line is expected to serve 5000 passengers per hour in each direction, though as the metro is built out further in the coming years its capacity is projected to increase to 43,000 passengers per hour. The system will be fully automated. By September 2024 the project timeline was under review and construction had yet to commence.
Aviation
Bahrain’s aviation industry has witnessed significant developments in recent years, marked by strategic investment and modernisation projects aimed at enhancing the kingdom’s position as a regional aviation node. Central to these efforts is the launch of the new terminal at BIA, which underwent an upgrade in 2021. The terminal is 210,000 sq metres, featuring 104 counters, 24 self-check-in kiosks and 24 departure gates, alongside enhanced cargo handling facilities and modern amenities designed to improve passenger experience and operational efficiency.
BIA has reported considerable growth in both air passenger and cargo traffic, reflecting a strong recovery from the pandemic years and enhanced regional connectivity. In the first half of 2024 BIA welcomed 4.6m passengers, marking a substantial increase from 6.9m passengers for the full year of 2022. This surge can be attributed to the introduction of new routes, increased inbound tourism and a post-pandemic rebound in business travel. Air cargo dipped slightly in 2023, with the airport processing some 197m kg of cargo over the course of the year, down from 210m kg in 2022. The decrease in air cargo volume reflects ongoing investment in maritime logistics, which has led to recovering sea freight volume in recent years.
Maritime Logistics
Waterborne trade volume across the GCC continued to be affected as a result of turbulent logistics markets during the Covid-19 period. Bahrain experienced a 7% drop in imports in 2023 through KBSP – the kingdom’s primary commercial seaport. Nevertheless, port traffic has shown strong signs of recovery. In 2023 KBSP saw total container throughput of 404,236 TEUs, up from 383,435 TEUs in 2022, and in line with the 2021 figure of 404,904 TEUs, according to PMA data. Roll-on/roll-off traffic had also increased, with 36,875 vehicles moving through KBSP in 2023, compared to 27,262 vehicles in 2022.
Total vessel traffic at KBSP has yet to reach pre-pandemic levels. In 2023, 773 cargo and passenger vessels called at KBSP, compared to 707 in 2022 and 782 in 2021 – with all these figures lower than the 871 in 2020 and 820 in 2019. Bahrain’s cruise industry also saw recovery in 2023, with 16 vessels visiting compared to seven in 2022 and none in 2021. For comparison, in 2019, 60 cruise ships stopped in the kingdom.
In December 2023 APM reaffirmed its 2030 growth strategy for KBSP in a presentation to the MTT and other relevant government entities. The plan, which aims to boost cargo throughput to 1m TEUs by 2030, involves positioning Bahrain as a cargo gateway to Saudi Arabia, developing the kingdom’s ship and steel recycling industry, establishing a regional food security centre and further developing local building materials supply chains, in addition to fostering organic growth. In 2024 the company introduced a new truck appointment system at the port to automate gate activity and upgrade the port’s back-end operating systems, all with the aim of boosting port productivity.
Outlook
Bahrain’s transport sector shows promise driven by significant government investment and strategic infrastructure projects. Initiatives such as the metro, additional roadworks, and a series of major land reclamation efforts are set to improve urban mobility and reduce congestion. These developments have the potential to draw considerable foreign direct investment, particularly in areas such as strategic planning, logistics, construction, and technology integration.
The kingdom’s economic environment, characterised by favourable regulatory frameworks and incentives, enhances the sector’s appeal to international investors. Additionally, sector modernisation is expected to create high-value jobs and stimulate ancillary industries, driving broader economic growth. As Bahrain continues to expand its infrastructure, the transport sector is poised to play a key role in further diversifying the economy away from oil and fostering sustainable development.
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