Once dismissed as another white-elephant project, the Lagos-Ibadan railway is fast proving to be a lifeline of efficiency. In just the first eight months of 2025, it carried nearly 700,000 passengers and hauled 380,000 tons of cargo-saving millions of travel hours and slashing haulage costs in a country long hobbled by gridlocked roads and high logistics expenses. Beyond speed, the corridor is driving productivity, preserving harvests and sparking new economic clusters, report ADEYINKA ADERIBIGBE, YINKA ADENIRAN and NTAKOBONG OTONGARAN
On a humid morning in Ibadan, the Oyo State capital, the Lagos-Ibadan train glides into its terminal with clockwork precision. From its doors pour a cross-section of Nigeria-civil servants gripping files, traders balancing bags of goods, students with backpacks slung over shoulders. Only hours earlier, they had departed Lagos, Africa’s largest city, where clogged roads once stretched the 120-kilometre trip into a punishing half-day ordeal. Today, the same journey takes just a little over two hours.
Completed in 2021, the Lagos-Ibadan rail line was initially celebrated as another milestone in infrastructure delivery. But fresh data suggests it is quietly maturing into something more transformative: a driver of economic efficiency. Between January and August 2025, the train carried 690,169 passengers. Monthly ridership climbed from 79,672 in January to 109,413 in August-a 37 per cent increase in just eight months. Behind those numbers lies a human story: workers reaching offices earlier, traders opening shop on time, students saving on bus fares and stress.
One civil servant captured the sentiment on X (formerly Twitter): ‘I left Lagos at 6:00 a.m. and was in a 9:00 a.m. meeting in Ibadan. By road, that was impossible.’ Economists say such time savings translate directly into productivity and disposable income. The World Bank notes that in economies burdened by high logistics costs, each minute shaved off travel yields measurable economic output. By saving passengers an estimated two hours each trip, the Lagos-Ibadan line restored nearly 1.4 million productive hours to Nigeria’s economy in just eight months-the equivalent of 160 years of labour time regained.
Freight revolution: The steel backbone of trade
If passenger trains showcase the rail’s social value, freight is the steel backbone that powers economies. Between January and August 2025, the Lagos-Ibadan line hauled 382,340 tons of cargo-cement, steel coils, gypsum, soda ash, and containerised goods, the very lifeblood of Nigeria’s industries. In April alone, over 73,000 tons moved on the line. That is freight that might otherwise have clogged highways, driven up haulage costs, or perished before reaching destination. By contrast, road transporters contend with soaring fuel bills, congestion delays, and accident risks.
For traders, the difference is tangible. A tomato merchant told Channels TV: ‘By road, half of our goods rot before reaching Ibadan. By train, more arrive fresh and we make more money.’ This is logistics efficiency at work. In Nigeria, transport typically consumes 30-40 per cent of business expenses-compared to under 10 per cent in developed economies. Every ton shifted from truck to train reduces costs, raises margins, and improves competitiveness.
Economic multipliers
Economists classify railways as general-purpose infrastructure-assets that lower transaction costs, stimulate trade, and integrate markets. Studies by the World Bank and African Development Bank (AfDB) suggest every dollar invested in rail can yield $1.50-$2.20 in wider economic output once spillovers into agriculture, manufacturing, and services are included. On the Lagos-Ibadan corridor, passenger fares and freight receipts totalled about ?12 billion (roughly $8 million) in the first eight months of 2025. Using AfDB’s multiplier, this translates into an additional $13-$19 million in economic value in less than a year.
The impact extends well beyond revenues. Towns along the line-Papalanto, Abeokuta, Moniya-are stirring back to life as stations double as logistics hubs. Land values around Ibadan station are rising, while shops, eateries, and small service firms sprout around the steady stream of commuters and traders. More broadly, the line is altering Nigeria’s inflation and growth dynamics. By shifting passengers and freight from the chronically congested Lagos-Ibadan expressway to rail, it chips away at one of the country’s deepest structural problems: high logistics costs.
For farmers and food traders, the change is striking. Perishable produce that once spoiled after a day in traffic now reaches markets intact, reducing waste and stabilising supply. Consumers, in turn, feel the benefit in more moderate food prices-vital in a country where food carries the heaviest weight in the inflation basket. The Lagos-Ibadan rail line is thus more than a transport project. It is a quiet lever of productivity, competitiveness, and price stability.
The headline inflation rate, which eased to about 20.1 per cent in August 2025 after months of food-driven surges, reflects a mix of influences. But improved efficiency along critical supply corridors such as Lagos-Ibadan stands out as one of the quiet structural supports cushioning upward pressure. The growth story becomes even clearer when viewed through output. Every commuter who reaches Ibadan in two hours instead of five embodies regained productivity: fewer wasted hours in gridlock, more time contributing to the economy. Every ton of cement, steel, or grain that moves inland by train rather than truck lowers factory input costs and distributor expenses, freeing up margins for reinvestment and expansion.
This productivity dividend loops back into the inflation story. Lower transport costs help cool food prices, and with food carrying the heaviest weight in Nigeria’s inflation basket, this feeds directly into headline inflation. The Lagos-Ibadan line is thus more than a commuter service. It is the flagship of a broader rail reform agenda under the Renewed Hope government. Central to this is the Track Access Programme, which opens Nigerian Railway Corporation (NRC) lines to licensed operators. Lagos State is already linking its Red Line commuter rail into the corridor, while Chinese partners are piloting freight runs. By attracting private capital and easing the government’s fiscal burden, the programme is breaking open a sector long closed to outside players.
The reform also doubles as industrial policy. At the Abuja International Railway Conference in September, the NRC signed a five-year agreement with Ajaokuta Steel Company to produce rolling stock components locally-especially steel wheels. The Lagos-Ibadan line will be among the first to benefit, reducing import dependence while channelling demand into Nigeria’s long-struggling steel sector.
Energy transition is another pillar. In partnership with the Presidential Initiative on Compressed Natural Gas (Pi-CNG), the NRC plans to convert diesel locomotives into hybrids using liquefied natural gas, while replacing diesel generators with gas-fired alternatives. For the corridor, that means lower operating costs, reduced emissions, and new demand for Nigeria’s gas reserves. Complementing this are shuttle vehicles linking stations to nearby towns, tightening intermodal connections and feeding local economies.
Equally critical is human capital. Through agreements with universities and technical institutes, the NRC is training a new cadre of engineers and technicians in modern rail operations. The Lagos-Ibadan corridor doubles as both showcase and classroom-embedding skills alongside steel, and building the human foundation for Nigeria’s rail future.
At Obafemi Awolowo Station in Moniya, Ibadan, the promise of rail-driven growth is visible – but uneven. Business activity peaks only when the trains arrive, then quickly fades into silence until the next service. Taxi operators, tricycles, and motorcycle riders spring to life as passengers with luggage disembark, haggling over fares in scenes that reflect both the vibrancy and fragility of the station’s economy. Operators told The Nation that while their incomes have improved compared to before the station opened, the pace of growth remains far below expectations. Comrade Abraham Temitope, a cab driver who has worked at the station for three years, put it bluntly: ‘Except for trains coming down, there’s nothing here again. Immediately the train leaves, nothing else happens until the evening. The government needs to work on more trips and create facilities around the station to attract people.’
He and others argued that hotels, malls, and family-friendly spaces could help keep visitors longer and stimulate commerce. They also lamented the abandoned road linking Moniya to the Oyo-Iseyin axis, warning that the unfinished stretch damages vehicles and discourages patronage. ‘The road has been left unfixed for almost three years. It is to our detriment every day,’ Temitope added.
The General Secretary of the Micra Cab Operators, Mr. Adebayo Abiodun, echoed these concerns. He noted that only two daily trips – three on weekends – limit the economic spin-offs. ‘By now, the train should be running at least three trips every day. More trips mean more passengers, and more passengers mean more business for us all,’ he said.
Awareness is another hurdle. Abiodun observed that many residents in Ibadan and even Lagos remain unaware the service is operational. ‘Many people I carry still tell me they didn’t know the train station was working. Publicity will help bring passengers, and when they come, our businesses will grow,’ he added. Around the station, petty traders such as food vendors and snack sellers depend largely on staff and transport operators for patronage, with only occasional sales to passengers. Property values, which had spiked after the terminal opened, have since plateaued as development momentum slowed.
Challenges of maintenance and sustainability
Even as the Lagos-Ibadan line demonstrates promise, sustainability looms large. Earlier this year, a derailment on the Abuja-Kaduna line reignited fears about safety and maintenance. Although the NRC restored service far more swiftly than in the past – a sign of greater responsiveness – questions linger: can Nigeria sustain adequate maintenance funding, resist political interference, and guarantee governance discipline over the long term? ‘Infrastructure is not only about building. It is about maintaining and managing,’ noted Prof. Sam Amadi, former regulator and energy policy scholar. ‘Rail can catalyse growth, but without governance, it can also collapse.’
The Lagos-Ibadan line also forms the southern stretch of the Lagos-Kano-Maradi corridor, envisioned as a continental trade spine under the African Continental Free Trade Area (AfCFTA). Properly linked to ports and extended inland, it could anchor Nigeria’s ambition to serve as West Africa’s logistics hub. Vice-President Kashim Shettima underscored this at the Abuja railway summit: ‘Railways connect raw materials to factories, workers to opportunities, and farmers to markets. They shape economies and societies. Every poor-looking country from China to Vietnam has used rail as a driver of development. Nigeria cannot afford to lag.’
Back at Ibadan station, as the last commuters head home and freight wagons roll north, the Lagos-Ibadan line feels like more than just steel and concrete. Each passenger carried and every ton of freight hauled chips away at Nigeria’s old reputation for inefficiency. Sustained momentum could turn this corridor into more than a transport link – into a lever for growth, integration, and renewal in a country searching for prosperity beyond oil.