Finance Minister Matia Kasaija has said if funds are available, government will extend the rail line to South Sudan.
Speaking during the handover of office to the new Uganda Railways Corporation managing director Mr Kasaija said being the cheapest means of transport, railway investments needed to be prioritised.
"If we can now rehabilitate the metre gauge railway all the way to Tororo, and if money allows, we may have to build it up to South Sudan, because it is the cheapest mode of transportation," he said.
South Sudan is an integral part of Uganda's export market being the second highest destination after Kenya. The country, in 2019, earned Uganda $351.5m.
Therefore, extending the railway line would reduce the cost of exporters to the country.
Currently, there are ongoing works aimed at refurbishing the already existing rail network in the country.
Mr Stanley Sendegeya, the new managing director, said there is a $1b requirement to revive the entire network with works centred on refurbishing lines and upgrading slippers from steel to concrete.
"We already have works approved such as Tororo-Gulu for €47m, Kampala-Malaba for $360m, the estimate for Kampala-Kasese is $500m and Gulu-Pakwach is $100m," he said, adding Uganda Railways Corporation is currently looking for financiers for the works.
In its short and medium term plan, Uganda Railways Corporation also intends to expand its passenger service beyond Kampala-Namanve.
Mr Sendengeya said there are plans to expand the passenger service to Kyengera and Port Bell, with longer term goals of moving to Jinja and Mityana in five years.
However, Uganda Railways Corporation still suffers numerous challenges, key among them, vandalism and encroachment on its land, which limit its ability to realise development.
Mr Sendegeya, who replaced Mr Charles Kateeba, has set an agenda for Uganda Railways Corporation to move forward, targeting the private sector.
In a model dubbed transit oriented, URC is targeting the private sector to invest in non-core areas of the business such as warehousing and hospitality.
During a press briefing in Kampala recently, Mr Kateeba, highlighted the role of privates sector in the transformation journey of the country's rail business.
"That model is to ensure that we bring private sector on board, if we can build a line then the private sector builds the warehouses and silos, that is the model we are going to adopt and it is the journey ahead of us," he said.