A memorandum of understanding was recently signed by Germany's national rail operator Deutsche Bahn (DB) with the local Al-Masaood Group in order to work on the planning, construction and operation of rail projects in the UAE.

With the signing of this deal, DB has moved a step closer to win multi-billion dollar deals aimed at working on important rail projects in the UAE, including the federal railway network.

As per Peter Ramsauer, Germany's federal minister of transport, "Germany will do everything in its power to support the UAE in setting up an ultra-modern, high-capacity rail infrastructure."

As of now, the rail projects planned in the UAE has metro and tram projects in Abu Dhabi, a metro in Dubai, and the federation-wide Union Railway.

It was on 24th March, when Union Railway announced its plan for the $11bn federal railway network. It will be by 2013 when the first phase of the project will be completed.

In the fist phase of railway, there would be construction of a 264-kilometre line connecting the Shah Gas field in the south of the emirate. It will also involve setting up of oil and gas processing and distribution facilities at the port of Ruwais in the north. It should be noted that in the beginning, the route will be for freight transport; however Union Railway is mulling to start passenger services.