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The Nigerian railway system came into existence In October, 1912 after Frederick

Lugard merged the preexisting Lagos government railroad and the Baro-Kano railroad
to develop into the 'Nigerian Railway'. The merger further improved the desirability of
consolidating the Southern and Northern Nigeria protectorates.

The railroad line ran on two main North and South routes, one from Lagos to Nguru and
Port Harcourt to Maiduguri, both tracts having branch extensions. Since the 1980s, the
Nigerian Railway Corporation was bounded by financial and technical shortcomings, but
since the 1960s, its functionality had not been encouraging. The civil war disconsolate
railway operations and in the subsequent years, the very low interest in export coal and
commodities led to decreased freight haulage. The rail corporation sparingly placed
commercial goals as a priority and government changes in policy and administration led
to managerial and structural issues. The use of tracks of narrow gauges spread with
curves and gradients combined with reduced maintenance over the decades led to slow
rates for trains. By 1978, the era coincided with substantial capital interventions from the
government to the railway sector though a great deal of the money was redirected to an
ill-fated shift to regular gauge tracks. The contract led to small positive development,
however, the contract with the Rail India Technical and Economic Services was not
renewed. From the end of the 1980s, decreased financing from the government, export
bans, and managerial issues diminished prevented the functioning of the railways.

Aside from the funding issue of the Nigerian railway system, there is also the challenge
of change in government. Every new administration includes its new programmes and
plans, without needing to guarantee continuity in execution of those strategies and
programmes. Therefore, clear distributive and regulatory policies that will aid in forcing
the railway mechanisms were absent. The institutional structure set up from the NRC
was inherently insufficient. Among the notable consequences of the problem is reflected
from the human capital in Nigeria's railway transport industry.

Regardless of the challenges mentioned above, a great deal of possibilities could be

harnessed in the exhausted system using a redefinition from the country's railway
development policy. To start with, the country, being among the biggest markets in Africa
and also the biggest in West Africa, provides enormous opportunities. Railway transport
appears to give much capability to boost economic growth and development in Nigeria.
Aside from its being capable of easing the strain on the country's road network, it is
definitely safer, more reliable and more economical, particularly concerning managing
mass cargo movements in the country's major cities. Thus, for any investment made,
the probability of huge returns is guaranteed.

Infrastructure -- Government involvement

The reason why government, particularly those of developing nations must supply
railways infrastructure is since there is not sufficient cash to be generated from the
business and the investment risks are too large for the private business. The
infrastructure funding is expensive