Following the rehabilitation and revival of railway lines, commodities will be transported directly from major ports in Kenya and Tanzania to Jinja Inland Container Depot (ICD).
The railway was last used in 2009.
Mr Daudi Migereko, the chairperson of Suppliers World Uganda Limited, a company in-charge of Jinja ICD, said an agreement was reached with Uganda Railways Corporation (URC) to rehabilitate the railway line as a way of boosting the economy in Jinja.
"As a business community, we have been holding discussions with URC so that we can revive delivery of commodities directly by railway from Kenya and Tanzania to Jinja ICD and also from Jinja to those countries other than using lorries and trailers," he said at a press conference at Jinja Inland container depot on Monday.
Mr Migereko, who is also the chairperson of Uganda Tourism Board (UTB), said shifting from road to railway transport is not only cheaper, but also reduces the wear-and-tear effect on highway roads.
"The rehabilitation of the railway line will reduce the cost of transport because it is not as expensive as road transport. Traffic congestion will also reduce because the number of trucks on the road will be few.
"Since traffic has also been diverted to the railway instead of relying on road only, the repair cost because of the wear-and-tear will also go down," he said, describing the development as 'a major breakthrough'.
He added that all bulky commodities such as coffee, sugar, sanitisers and lime can easily be transported to Nairobi, Mombasa, Dar es Salaam, Dodoma, Mwanza, Kisumu and Port Bell, among other destinations, through railway transport.
Mr Mustapha Kizza, a businessman in Jinja dealing in animal feeds, said they have been paying exorbitant fees to transport commodities to Kenya.
Mr Duncan Kakonge, an enforcement supervisor in-charge of eastern region, said they are ready to work with all the stakeholders for the good of the economy.
"We are delighted to have this service in Jinja and we thank all those who have enabled the railway to be reopened because locomotives carry more goods compared to trucks," he said.
During the State of the Nation address in June, President Museveni emphasised the need to rehabilitate the old railway network following rising cases of Covid-19, among truck drivers, prompting the government to approve Shs1.4 trillion to rehabilitate the 215km Malaba-Kampala meter-gauge railway line.
Mr Charles Kateeba, the managing director of Uganda Railways Corporation, said government also approved Shs48 billion to purchase eight locomotives.