This is a Category A project according to IFC’s Environmental and Social Sustainability Policy due to the potentially significant and diverse environmental and social risks related to the project construction and operations that may lead to irreversible damage or impacts. E&S risks and potential impacts which are considered to be significant include (i) operational noise impacts at sensitive receptors along the route ; (ii) overlap of the project with the Sorbulak Lake System KBA and impacts on associated priority biodiversity values; (iii) cultural heritage, as the project passes through the protection zone of a burial ground of the early Iron Age era; and (iv) government-led land acquisition affecting 284 land plots, the acquisition of nine commercial buildings and 13 residential structures.

Other E&S issues reviewed as part of IFC’s appraisal include: (i) the company’s capacity and systems to manage E&S aspects during construction and operation; (ii) contractor management, working conditions, and occupational health and safety (OHS) of construction workers; (iii) gender-related risks, including gender-based violence (GBV); (iv) pollution prevention, management and control during construction and operations; (v) management of construction wastes and waste water discharged from the construction sites, and from stations, depots, offices and accommodation facilities during operations; (vi) community health and safety protection and management including emergency response and railway safety; (vii) management of quarry sites commencement, operation and closure; and (viii) KTZ’s stakeholder engagement activities related to E&S aspects including noise, cultural heritage, land acquisition, and railway traffic safety.

PS 1 - Assessment and Management of Environmental and Social Risks and Impacts

Environmental and Social Assessment and Management System

KTZ has an Environmental Policy, Occupational Health and Safety (OHS) Policy, Social Policy, Sustainable Development Policy and a standalone policy for the Prevention of Harassment and Discrimination which are disclosed on its website (https://railways.kz/en/ur/).

The company has a corporate Environmental and Social Management System (ESMS) which covers the primary operations and services, i.e. management of processes of providing mainline railways network services, freight transportation services and passenger transportation services provided by KTZ and its subsidiaries that is certified to ISO 9001 (quality), ISO14001 (environmental), ISO45001 (OHS) and ISO50001 (energy management), with certifications valid until 2027. The ESMS of the company includes processes for identification of risks and impacts; occupational and environmental safety, legal compliance, conservation of natural resources and biodiversity, pollution prevention including air emissions, waste management and management of wastewater and discharges, E&S monitoring and review, and emergency response and stakeholder engagement. KTZ will revise its corporate ESMS to align it with IFC PSs, particularly in contractor management, construction supervision and oversight requirements outlined in IFC Good Practice Note on Management of Contractors’ Environmental and Social Performance, as well as O&M phase EHS Good International Industry Practice (GIIP) as specified in the World Bank Group EHS Guidelines for Railways including but not limited to in relation to operational rail safety management systems and will include monitoring requirements with relevant parameters and indicators, consistent with operations phase E&S management plans (ESAP #1i).

The EPC contractor has ISO 9001, 14001 and 45001 certificates, and a corporate statement on OHS management. As per ESAP #2ii, KTZ will ensure that the EPC contractor has its own project specific construction phase Environmental and Social Management Plan (CESMP) compliant with IFC’s Performance Standards. The CESMP will align with the Construction ESMS, and include, but not be limited to, safety and environment monitoring, including dust, noise and vibration measurements, inspection and reporting; safety hazards prevention and control; accident prevention; use of personal protective equipment; life and fire safety (L&FS), emergency preparedness and response procedure; hazardous materials safety including asbestos management; electrical safety; excavation works; work at height, waste management; storm water, erosion control and wastewater management; first aid; EHS and OHS training programs; workers’ grievance mechanism; traffic management; and quarry sites management and rehabilitation. KTZ will oversee engineering, and construction works as well as implementation of environmental, social, health and safety (ESHS) measures during the construction phase including implementation of contractors’ ESMPs. KTZ will develop, as per ESAP #2i, a Construction Supervision Management Plan (CSMP) including regulatory ESHS requirements and check and control mechanisms for the implementation of the IFC PS aligned ESMP by the EPC contractor with clearly identified roles and responsibilities. CSMP will also include monitoring requirements for the workers’ accommodation camps per the Construction Camp & Workers Accommodation Guidelines included in CESMS including the inspection checklist to ensure that accommodation of construction workers (contractors and sub-contractors) is in line with IFC and EBRD Good Practice Note on Workers’ Accommodation.

Identification and Management of Risks and Impacts

KTZ has policy and procedures identified in the publicly disclosed OHS and EHS Hazards and Risks Identification and Management document dated 2023 (https://railways.kz/en/ur/environmental-responsibility/), which covers operations of KTZ and its subsidiaries. These procedures are implemented by means of the electronic Integrated System for Industrial Safety (ISIS). The ISIS app is installed on the mobile phones of KTZ employees. The E&S risk screening data from each KTZ location in Kazakhstan flows into the central data processing facility in the KTZ headquarters in Astana. ISIS allows KTZ employees to report and investigate near misses, incidents, and accidents. The system automatically develops mitigation actions, assigns responsibilities, and tracks the implementation. KTZ Operational OHS and EHS Hazards and Risks Identification and Management document will be revised as part of corporate ESMS revision under ESAP #1.

The project EIA was prepared in 2023 by a licensed contractor, in line with the Environmental Code of RoK (No 400-VI ???) and the national permitting processes. The EIA was approved by the Committee for Environmental Regulation and Control, Ministry of Ecology and Natural Resources of the RoK on 20 February 2024 (Ref. KZ35VVX00286500).  A supplemental Environmental and Social Impact Assessment (ESIA) was completed in April 2025 to identify additional E&S issues and to consider requirements of the IFC PSs including a social baseline as well as assessing social risks and impacts; mitigation measures and fulfill IFC’s requirements on public information, consultation and disclosure.

The supplemental ESIA, reflects the latest changes in the railway design, establishes baseline conditions based on secondary data and field surveys, and includes consideration of project alternatives, potential cumulative impacts, and the outcomes of public consultation activities performed by the RoK since the announcement of the project in March 2022. Mitigation measures for project construction are presented in the management plans and monitoring programs, associated with the ESIA. As per ESAP #1ii, KTZ, in line with its updated corporate ESMS, will develop and implement operational E&S management plans and procedures for the project before commencement of the railway bypass line including assigned roles and responsibilities. This will include, but not be limited to, an Emergency Preparedness and Response Plan (EPRP), a Spill Management Plan, a Waste Management Plan and a Security Management Plan as detailed under related sections in the ESRS.

The project EIA and supplemental ESIA including ESMPs are disclosed together with this ESRS.

Organizational Capacity and Competency

The Directorate of Large-Scale Project Realization of KTZ has overall responsibility for the design and construction of the railway line system including management of contractors and EHS issues of the construction projects. Construction supervision is outsourced to external specialists which form KTZ’s technical inspection team consisting of technical experts in civil, mechanical and electrical engineering. KTZ will include in its technical inspection team responsible for supervision of construction works at a minimum, one dedicated and qualified E&S expert and one OHS expert to provide oversight of the ESHS and OHS performance of the EPC and sub-contractors at the project site (ESAP #3i). As per ESAP 16, KTZ will employ a competent social specialist who will also act as a Community Liaison Officer (CLO) to ensure proper implementation of the project SEP and PS5 related mitigation measures as identified below.

Integra Construction KZ LLP (“Integra”) is the appointed Engineering Procurement and Construction (EPC) Contractor responsible for the construction and project management. As per the EPC contract, the contractor’s responsibility covers managing day-to-day ESHS issues, implementing the required mitigations, providing EHS training to its workforce, including its subcontractors. KTZ will ensure that the EPC contractor will have a dedicated EHS manager and team with adequate technical knowledge of good international industry practice to implement the Construction Environmental and Social Management Plan (CESMP) and comply with project’s requirements, consistent with IFC Performance Standards (ESAP #3ii).  

In addition to being the developer, KTZ will be responsible for managing the railway operations. Environmental, OHS, transportation safety and energy departments are under the Directorate of the Technical Policy. Another function which is also a part of the Directorate of the Technical Policy is a transportation safety department whose main function is to ensure safety and security of the tracks, locomotives and passenger and freight rolling stock to avoid accidents and incidents such as collisions and derailment.

Emergency Preparedness and Response

A construction Emergency Preparedness and Response and Plan (EPRP) has been prepared as part of the CESEMP. KTZ has a corporate Emergency Preparedness and Response Standard (2022) which describes a tiered response to incidents, emergencies and crises and is broadly consistent with international best practice and IFC PS1. The standard outlines the requirements for training, emergency equipment supply, procedure for forming an emergency management team, steps for emergency investigation with a purpose of identifying a root cause, as well as regular drills and monitoring and auditing of the emergency response system. In addition, KTZ develops and regularly updates life and fire safety (L&FS) plans for the offices, train stations and the rolling stock. During operations KTZ corporate emergency response plan and management approach will be implemented for the project.

In response to identified challenges posed by climate change, such as extreme heat and cold, flooding, water stress, and wildfires, KTZ will update its operational EPRP to incorporate climate change considerations for flooding events and wildfire-specific measures, including air filtration systems and wildfire emergency trainings (ESAP #1ii). 

Monitoring and Review

KTZ will monitor the key E&S parameters and performance indicators during construction as identified in the construction ESMS framework and associated management plans. The construction ESMP of the EPC contractor under ESAP #2ii will include, among others, monitoring of air emissions and ambient air quality, noise levels, waste generation and disposal, wastewater discharges and water quality, construction traffic, safety performance, and community relations and complaints. An E&S monitoring plan for the operations phase will be developed within the scope of corporate ESMS update, under ESAP #1i, that will cover relevant parameters and indicators, consistent with operations phase E&S management plans.

PS 2 – Labor and Working Conditions

KTZ is the largest employer in the country with a total number of 116,560 direct employees under permanent, temporary, full-time or part-time employment contract (as of end of 2023), of which 22.4 percent are women. The numbers of employees engaged under service contracts or out staffing contracts are 227 and 385, respectively. The construction phase (24 months) is expected to result in the employment of an average of about 1,000 workers, with a total peak workforce of 1,500, including EPC contractor and subcontractors’ workforce. The operational and maintenance phase of the project is expected to generate 500 additional employees.

Human Resources (HR) Policies and Procedures

Policies and procedures governing KTZ’s Human Resources (HR) practices have been developed in line with national legislation and are generally consistent with IFC PS2, although they can better address GBVH risks and grievances management as per ESAP #4 and ESAP #5 detailed below. The HR Policy covers all employees of KTZ including its subsidiaries and branch organizations. KTZ also has a Human Rights Policy. These policies include provisions for working conditions, respect for employees’ right to freedom of association, non-discrimination, payments, prohibitions against child labor and forced labor, occupational health and safety, internal grievance mechanisms, third-party suppliers, etc.

Working Conditions and Terms of Employment

The vast majority of the KTZ employees (90.7?%) work under long-term contracts, whereas 9.3?% of them are employed under term contracts and all employees (99.9%) are full-time staff. The employee rights and duties (including wages, working hours, overtime arrangements and compensation, benefits etc.) are communicated at employment and documented in contracts signed with each employee and which are clearly spelled out in the Collective Bargaining Agreement (CBA). Minimum monthly salary of operational staff in KTZ and its subsidiaries is higher than the minimum wage established by Law #163-VII ZRK “On the Central Government Budget for 2023–2025” dated December 1, 2022.

Workers Organization and Collective Bargaining

KTZ is a party to the CBA concluded on January 1, 2024 for the period 2024-2026 (https://railways.kz/en/ur/social-responsibility/social-responsibility/), which is aligned with PS2 requirements. The 82.6% of KTZ employees are members of the Kazakhstan Industrial Trade Union of the Workers of Railroad, Automobile, Air and Water Transport Public Association but the CBA signed with the trade union covers 100% of the employees.

Non-Discrimination, Gender Based Violence and Sexual Harassment (GBVH):

Non-discrimination and equal opportunity, and sexual harassment are addressed in the Anti-Harassment and Discrimination Policy, Human Rights Policy, both disclosed in 2024, and in the Code of Ethics and Conduct of the KTZ, which can be accessed at: https://railways.kz/en/ur/social-responsibility/personnel-policy/. As per ESAP #4, KTZ will revise its HR policies and procedures to better address and define gender-based violence and sexual harassment (GBVH) and include disciplinary measures and definitions of prohibited behaviors in the Code of Conduct. Additional provisions regarding GBVH grievances are detailed in ESAP #5 below.

Grievance Mechanism

KTZ’s provisions for the internal grievance mechanism are described in the existing CBA and in the Code of Ethics and Behavior. Grievances are registered through a toll-free number, intranet, and grievance boxes distributed in the offices and facilities. KTZ has appointed a corporate ombudsman whose functions include assisting employees in resolving grievances and labor disputes. KTZ also operates a hotline through an independent entity for confidential reporting and raising concerns about ethics and compliance issues in work related areas including discrimination, working conditions, threats to health, safety and the environment and harassment. The current grievance mechanism does not allow for anonymous and in-person submission grievances, lacks clear procedural steps and does not have a survivor-centered approach. As per ESAP #5, KTZ will restructure its grievance mechanism to allow employees and contractors to submit anonymous complaints and raise GBVH related grievances. This mechanism will be disclosed and communicated to employees, contractors and community members through trainings and awareness raising activities.

Occupational Health and Safety

In January 2019, KTZ joined the International Social Security Association (ISSA), which stipulates the principles of the “Vision Zero” concept. As a result, the Managing Board of KTZ approved the Right to Stop the Works commitment, which authorizes each employee of the company to stop any unsafe works being an immediate threat to life and health and initiated automated Integrated Industrial Safety System (ISIS) including the following modules: internal controls, behavioral safety dialogues, incident, emergency, safety alerts and newsletter management, environment protection, industrial facility work conditions certification process, questionnaire survey, and safety shares. ISIS allows KTZ employees to report and investigate near misses, incidents, and accidents. The system automatically develops mitigation actions, assigns responsibilities, and tracks the implementation. 

KTZ updated its Health and Safety Management System Manual in 2023 based on Hazard and Environmental Risk Identification, Assessment and Industrial Safety Risk Management Standard approved by the Resolution of the Management Board of KTZ dated September 1, 2023 (No. 614-CZ). The Lost Time Incidence Frequency Rate (LTIFR) of KTZ operations was reported as 0.25, 0.21 and 0.17 for the last three years, which are well below the industry benchmark for rail transportation (6.5-US data). Annual medical examination is compulsory for the employees in charge of heavy physical works or who are being exposed to noise vibration and/or electromagnetic radiation.

KTZ has a training center based in Astana providing professional technical as well as health and safety trainings to employees of KTZ supported by simulations, 3D laboratories and distance learning infrastructure. In 2023, a total of 67,356 employees received 61,650 hours of training mainly in work safety including working at height, hot work, earth work, electromagnetic radiation, machinery and equipment operation safety, isolation of energy sources, confined space entry and hand safety; occupational hygiene and industrial sanitary measures, first aid measures and using the defibrillator, occupational hazard and risk management and incidence investigation.

Project CESMP addresses construction related risks for workers including, lifting and rigging, vehicle safety, manual handling, electrical works working at height, hot work activities in addition to extreme heat and cold temperatures related risks for the construction workers. KTZ will include work schedule adjustments for extreme heat and cold in its corporate operational OHS procedures and ensure that all workers are provided with and trained in the correct usage of PPE to address risks associated with extreme heat and cold (ESAP #6).

Contractor Management

KTZ adopted a contractor and supplier management policy for safety management standards for the contractor entities of KTZ and its subsidiaries. The standard sets forth the obligations for the contractors to comply with the legal acts and policy requirements of KTZ, to hold kick off meetings for providing the introductory health and safety briefings with the contractors’ personnel, as well as to monitor the compliance therewith. KTZ will integrate contractor management requirements in its corporate ESMS (ESAP #1i) outlining how KTZ will monitor compliance with the E&S policies and standards by its contractors and their sub-contractors.

The EPC contractor has a Statement on H&S Management aligned with ISO 45001 requirements. The statement highlights the company’s position on complying with the national legal requirements for workers’ health and safety. It also outlines roles and responsibilities; safety at work and PPE requirements; work permit system; medical surveillance; training and inductions; and monitoring principles.

The EPC contractor has deployed its own OHS specialists on site as contractually required. Induction training is provided to new employees and refresher OHS training is provided to all employees at the construction site. KTZ will ensure the EPC contractor will develop an HSE and labor management plan and relevant procedures for monitoring and supervising the implementations of its sub-contractors, with assigned roles and responsibilities as described under ESAP #2ii. 

KTZ will also monitor the workers’ accommodation per the Construction Camp & Workers Accommodation Guideline included in CESMS including the inspection checklist as identified under ESAP #2i.

PS 3 – Resource Efficiency and Pollution Prevention

Resource Efficiency

Electricity is supplied by the regional grid. Total electricity consumption during construction is projected to be 1,200,000 kWh. Total liquified propane gas (LPG) consumption is expected to be 12,000 liters and total diesel oil to be 1,793 tons. During operations, annual electricity usage is expected to be 85,600,000 kWh, diesel oil, 1,839 tons/year and LPG, 1,500 liters/year.

During construction, the total volume of potable water consumed is expected to be 18,323 m3, which will be provided by private water suppliers under valid permits from the authorities. Total volume of technical and chemical water (i.e. non potable water) for concrete production and for dust suppression is 75,731 m3 and will be sourced from the eight groundwater wells along the alignment. The groundwater resources are shared with other users, however the results of the supplementary ESIA indicate that abstraction will not affect groundwater recharge rates or long-term availability given the moderate withdrawal volumes. Water meters are installed on the bore wells and groundwater extraction records shall be maintained daily.

Khazybek Bek and Zhetygen stations and depots will be connected to municipal water supply networks for provision of potable water. During operations, total water consumption is calculated to be 60 m3/day and 21,918 m3/year. Water storage tanks designed for each station vary between 15 m3 to 100 m3. At the smaller intermediary stations, water for these purposes will be transferred by rail or road tanker. Irrigation of green areas within station boundaries will be primarily from wastewater treated. Firefighting waters will be sourced from groundwater. Each station will have fire-fighting tanks with 200 m3 and 300 m3 capacity.

GHG Emissions

During construction, the consumption of diesel oil for on-road transportation and off-road construction and mobile combustion will be the main source of GHG emissions. The supplementary ESIA estimated GHG emissions at 18,560 tons of CO2 equivalent (tCO2eq) per year. Stationary combustion – scope 1 accounts for the largest share of emissions in the first year (71%) and mobile combustion – scope 1 accounts for 27%.

The projected GHG emissions during operations will be associated with electricity and fuel consumption for operations and maintenance activities. The electricity consumed (scope 2), mainly by trains and stations is anticipated to result in 41,704 tons of CO2eq per year, accounting for almost 72% of the annual emissions during the operation phase. Annual emissions of LPG and diesel oil will account for 16,263 tons of CO2eq per year which is 28% of total annual emissions during operations. The total GHG emissions was calculated as 57,968 tons of CO2eq per year. 

The 2023-2027 low-carbon development action plan of KTZ and its branch organizations identifies measures to be taken to reduce carbon emissions to achieve sustainable development in accordance with the country’s climate goals. The measures include energy saving and energy efficiency measures such as replacing light bulbs, installing low-emission film on windows, installing heat-reflecting screens, upgrading heating systems and fuel and energy resources consumption. As a result of these activities, the reduction of total CO 2 -eq emissions amounted to 19,786.42 tons in 2023. KTZ targets to reduce direct emissions by 25?% in relation to 2020 emissions levels.

KTZ will continue monitoring direct GHG emissions in line with PS3 and in accordance with internationally recognized methodologies and good practice, also where required, expanding the monitoring scope to include indirect emissions. Verified reports and the annual carbon footprint of the project will be shared with IFC as part of an annual monitoring report (AMR).

Noise

The Kazakhstan legal noise level requirements (55 LAeq(1hour), dBA 45 LAeq(1hour), dBA) are generally in line with World Health Organization and WBG guidelines.  However, unlike the WBG General EHS Guidelines, national standards also include daytime Lmax (Maximum Sound Level) limits (70 Lmax, dBA-daytime and 60 Lmax, dBA-nighttime) which represent the highest instantaneous noise level recorded within a given measurement period. Noise during construction will be caused by mobile and stationary plants and vehicle movements. Results of noise modelling for construction performed as part of the ESIA indicate that impacts, post mitigation will be negligible to minor outside of the RoW.

Changes in noise at sensitive receptors resulting from the operations have been modelled, assessed using noise thresholds following the Transit Noise and Vibration Impact Assessment Manual (2018) from the United States Federal Transit Administration (USFTA). The USFTA Assessment Manual is considered as Good International Industry Practice (GIIP) by the supplementary ESIA. Based on the baseline noise studies conducted to date significant operational noise impacts with predicted levels well above the national noise regulations were predicted to occur at approximately 12 properties near Kazybek Bek station and 10 properties close to Zhetygen station. KTZ is committed to addressing noise impacts and feasible options for reducing rail noise at impacted receptors have been identified. These include noise barriers of 2.25 km at Zhetygen Station and 1 km at Kazybek Bek Station and sound proofing of properties as described in the supplementary ESIA.

As per ESAP #7i, KTZ will undertake additional baseline noise measurements undertaken with longer period sound sampling and modelling according to planned train schedule to i) confirm the residential areas where significant operational noise impacts are predicted to occur along the railway; ii) inform and refine the design of the noise barriers; and iii) identify additional measures to be taken including, but not limited to, noise enclosures for stationary noise generating equipment, speed restrictions and other operational measures in noise sensitive locations, replacement and regular maintenance of rolling stock and noise generating equipment. KTZ, as per ESAP #7ii, will develop an operational noise management plan including mitigation measures to ensure that noise levels at properties near the project boundaries do not exceed noise thresholds specified in the WBG EHS General Guidelines and national noise standards. KTZ, after implementation of mitigation measures identified in the plan, will commission a third-party noise expert to confirm the completion and implementation of mitigation measures identified in the plan before the commencement of operations and the third-party noise expert will also identify residual noise impact and propose further mitigation for adoption by KTZ if required (ESAP #8).

As per ESAP #9, KTZ will integrate an operational noise monitoring plan in its operational ESMS, to monitor noise at sensitive receptors identified in the ESIA, and an operational noise mitigation plan to track changes in noise levels over time which will include an adaptive management protocol. The monitoring plan will include a community grievance mechanism to identify, track and respond to any local concerns regarding noise nuisance.

Air Emissions and Ambient Air Quality

Potential impacts to the air sensitive receptors during the construction phase mainly include emissions from heavy vehicular exhaust and dust emitted from earthworks and construction activities including borrow pit operations. The key air quality control and mitigation measures are identified in the CESMS and its sub-plans, including an air pollution management plan including dust suppression measures, traffic management plan, and regular preventive engine maintenance and engine exhaust tests for construction machinery and motor vehicles. The ESIA predicts negligible air quality impacts during construction.

During operations, emissions associated with the new and refurbished stations will be generated by boilers, fuel storage tanks, gas storage, blow down and diesel locomotive maneuvering in addition to emissions from light vehicle exhaust due to increased traffic accessing the stations which was identified as the predominant air emission source. The station buildings will be heated with free-standing volumetric block boilers which have an output capacity of 348 or 610 kW. A diesel back up boiler is generally provided, fed from either a 5 m3 or 10 m3 tank. For the operational phase, the dispersion modelling results show that maximum permissible concentrations will not be exceeded for any of the air pollutants based on the limits set in the WBG General EHS Guidelines.

Wastewater

Potential deterioration of surface and ground water quality during construction may occur from wastewater discharges from worker sanitation, cement batching and run-off from aggregate storage for example. Runoff from construction sites, particularly for bridge and culvert implementation, can also contain high levels of sediment and there is a risk of pollution from accidental spills from transport, storage, use and disposal of hazardous materials including oil and fuel. The EPC contractor’s CESMP as identified in ESAP #2ii, will include a construction storm water, erosion control and water monitoring plan that is consistent with GIIP and is designed mitigate that impact of elevated turbidity due to construction activities on surface waters receiving run off from the construction areas.

Sources of operational wastewater include sewerage and storm water from stations, accommodation and office facilities, and water from maintenance facilities that may be contaminated with oils, grease and chemicals. All operational facilities are designed to either discharge to the municipal wastewater system or include appropriately sized wastewater treatment plants with oil / water separators and grease traps, installed prior to treatment at sites where contamination is possible. Biological water treatment plants servicing each station will have a capacity of between 10 m3/day and 40 m3/day (depending on the services and passenger capacity of the station) and to receive emergency discharge of untreated wastewater, storage tanks between 10 m3 and 50 m3 capacity are also designed. The wastewater will be subject to UV disinfection prior to storage in retention ponds and subsequent   use for irrigation of green spaces. The use of the treated sewage effluent for irrigation is regulated under the Water Code and Environmental Code of Kazakhstan will be subject to a special water use permit from the authorized state body.

The ESIA indicated that the effects of the river crossings during operation on hydrology and water quality would be minor.

Solid and Hazardous Waste Management

Total solid waste generated during construction is expected to be 79,446 tons including 77,500 tons of construction waste. Hazardous wastes including paint and varnish containers, oily rags and welding electrode cinders is estimated at 2.75 tons during the construction. The existing municipal waste landfill at Kazybek Bek will be used for disposing construction and domestic wastes. Hazardous wastes will be disposed of according to the CESMP at designated and authorized waste disposal facilities. During operations, total waste generated is estimated at 61 tons/year with no hazardous waste routinely generated. Solid and hazardous wastes during operation will be segregated, stored and disposed according to an operations phase Waste Management Plan (WMP) which will be included in the operational ESMPs of the KTZ under ESAP #1ii.

Hazardous Materials

KTZ is committed to storing oils and chemicals in storage areas that are designed in accordance with GIIP. KTZ, to mitigate the effects of accidental releases of hydrocarbons from locomotive and fuel depots, as per ESAP #1ii, will undertake a risk assessment to identify areas where release of hydrocarbons may occur, and will develop a Spill Management Plan to control non routine releases of hydrocarbons to the ground and surface waters consistent with GIIP.

No asbestos containing material (ACM) was observed at the existing stations. KTZ, as per ESAP #10i, will undertake a detailed ACM survey by a specialized vendor as part of the refurbishment of the existing stations. In case that ACM is found, a dedicated ACM handling and disposal management plan will be prepared in line with GIIP (ESAP #10ii)

Earth Works and Construction Materials Extraction

The project will require large-scale (6.2 million m3) earthwork activities, due to the complex relief and challenging technogenic conditions i.e., quick sands, mudslide areas, unstable ground, etc.) requiring replacement of geotechnically unsuitable ground. All construction quarries will be backfilled with planted vegetation and areas with disturbed soil and vegetation will be restored to limit exposed soil surfaces and surface runoff after the completion of construction. Perennial grass will be sowed on the surface of fertile soil with mineral fertilizer added. The CESMP of the EPC contractor under ESAP #2ii will include a quarry site closure and rehabilitation plan compliant with WBG EHS guidelines for Construction Materials Extraction and GIIP, to meet the objectives of physical, chemical, and ecological habitat integrity and including estimated timelines and cost.

PS 4 – Community Health, Safety and Security

Community Health and Safety

Aside from transport and traffic safety, there will be potential impacts due to the proximity of the railway to settlements and villages, particularly at Kazybek Bek and Zhetygen stations. Impacts on community health and safety during the construction and operational phases of the project are expected to stem from dust and noise due to the movement of vehicles, equipment, materials and project personnel, interactions with security personnel associated with the railway and stations, and from risks of electrical infrastructure.

Other measures to protect the community from physical, chemical, or other hazards associated with the construction and operations phases will include removal of hazardous conditions on site, community awareness-raising measures, noise and dust control.

Transport and Traffic Safety

During construction, there is the potential for community safety impacts due to increased traffic on the road network close to the project construction right of way. KTZ, as described in project CESMS, will implement construction safety measures to protect the public, including use of barricading and other access control measures near construction areas, traffic safety, control of construction vehicles, clear demarcation and proper illumination of these areas and provision of safety information to visitors, where appropriate. Water supply systems of existing and projected stations and sidings are designed to provide external and internal fire extinguishing. All measures will be described in the Community Health and Safety plans, developed as part of CESMP and OESMP, as identified under ESAP #2 and #4.

Safe passage for vehicles, pedestrians and animals across the railway will be provided via several overpasses, which are already included in the project design. KTZ will undertake a needs assessment for additional overpasses and access roads for mitigating impacts of local community severance, regarding access to public services, agricultural lands, animal grazing fields and other nearby communities. This assessment will be done in consultation with the people affected in the project area, identify necessary design changes and implementation requirements for the construction contractor ESAP #11.

KTZ reports railroad incidents in its Integrated Annual Reports. The railroad traffic safety rate of the KTZ operations was reported as 0.81, 0.7 and 0.62 for 2021, 2022 and 2023, respectively demonstrating an improvement in road safety. KTZ will develop and implement a transport and railroad traffic safety management plan which will identify necessary signalizations and warning signs and raise awareness among the residents of nearby settlements to minimize the risk of pedestrians near the railroad (ESAP #12).

Security Personnel

The project in both construction and operational phases does not anticipate deployment of armed security forces. Each sub-contractor has its own security staff stationed only at labour camps, storage areas and vehicle parking areas for nighttime surveillance. A subsidiary of KTZ provides security services for high value cargo such as precious metals and the security of passenger trains is provided by the state police. At the time of the appraisal, KTZ was developing a corporate security policy and related procedures. KTZ will ensure that the developed security management plan, that includes security policy and code of conduct, will be included in the company’s operational ESMS, as per ESAP #4, is consistent with IFC PS4 requirements.

PS5: Land Acquisition and Involuntary Resettlement

Government-managed Land Acquisition and Resettlement

The RoK, through the local district governments (Akimats), initiated a land acquisition process in 2023, to acquire approximately 1,056 ha of land in Iliy, Karasay, Talgar and Zhambyl districts and Alatau city for the project in line with national laws and regulations. This land acquisition affected 284 land parcels in total, out of which 117 parcels were public land including 52 land parcels under lease agreements and 167 parcels were privately owned. The land required for the project constitutes only five percent of the total area of the affected land parcels. Of the privately owned and leased land parcels that were acquired, it is estimated that only 16% are fully impacted as most of parcels (84%) are only partially impacted.

As of February 2025, land acquisition and compensation for 70 plots were complete as per national legislation, acquisition was under process for 92 plots, 19 land plots were under court cases, and 38 land plots were identified as not requiring acquisition and compensation as they are either state-owned land under lease or considered insignificant in size hence voluntarily donated upon negotiation with the landowner. There are 22 structures identified for acquisition on the land plots in Alatou city, of which 13 are residential and nine are barns or small shops. In addition, land acquisition requirement for the sections of 18 OHTLs which will be permanently diverted is not known as the design for these OHTLs has not been finalised yet.

The following two studies were completed: (i) Report on Gap Analysis Between Land Acquisition and Resettlement Policy and Procedures of the Government of Kazakhstan and IFC PS5 Requirements, in September 2024, to assess the gaps between the procedures and processes used for acquisition of land and IFC Performance Standard 5 (PS5); and ii) Livelihood Restoration Plan (LRP) in February 2025 within the scope of supplementary ESIA.

According to these studies, majority of the affected land is used for agriculture in the form of peasant farming (86.5%), commercial farmlands (4.9%), and others (8.6%) including housing or grazing. There are 13 residential houses and nine barns and small shops which were not in use at the time they were visited in January 2024 and still yet to be acquired. The LRP approximately estimated that around 254 to 427 households would be affected, including owners or users of 13 residential structures to be physically relocated (13 to 15 households), commercial entities (18 to 27 households) and landowners losing all (29 to 45 households) or part (130 to 155 households) of their land and/or assets to the project, land leasers with residential structures (1 to 5 households) and other land leasers losing all (7 to 20 households) or part (36 to 60 households) of access to the land, 18 to 27 commercial agricultural entities, nine small barns and shops, 20 to 100 workers. The LRP noted that the land acquisition could also possibly affect people from surrounding settlements informally using the land for livestock grazing. According to population census of 2021 conducted by Bureau of National Statistics of Kazakhstan, the average rural household size is 3.9 in the country and thus the total number of affected people is approximately estimated at between 1,000 and 1,700 including land acquisition affected households and employees and seasonal workforce of affected agricultural businesses.

These studies also identified gaps between Kazakhstan's land-related legal provisions and IFC Performance Standard 5 (PS5) requirements. These gaps primarily pertain to the preparation of a resettlement plan, compensation at replacement cost, providing transitional allowance for the delays in compensation, restoration of livelihoods for affected people, provisions for vulnerable and severely affected groups, consultation with affected persons, information disclosure, and grievance redress mechanisms. The LRP disclosed with the supplementary ESIA, identifies the estimated compensation gaps, required implementation procedures, valuation methods, entitlement principles, consultation mechanisms with the affected people, organizational responsibilities, grievance mechanism and monitoring requirements. A Resettlement Action Plan Framework was developed for addressing the gaps in compensation of structures/houses and in relocation of 13 residential houses and the other structures in Alatou city.

KTZ, as per ESAP #13, will commission a competent resettlement consultant and a team of experts to develop a Resettlement Action Plan (RAP) including a final Livelihood Restoration Plan (LRP) which will i) address the land survey and household level data gap related with the impacted 167 privately owned and 52 leased land plots including donated lands; ii) clarify the plots used for grazing and the users of these lands; iii) identify household level entitlements to compensation, allowances, assistance, and livelihood restoration measures; and iv) design implementation arrangements for the livelihood supports to be provided to affected households with an implementation organization and timeline. The RAP will be consistent with the Resettlement Action Plan Framework prepared within the scope of supplementary ESIA to ensure that the affected people were provided with additional payments to compensate the depreciated amount deducted from the compensation value, moving and transaction costs and the procedures to be followed for the physical relocation of these affected people including consultation and grievance mechanisms and assistance to be provided for the physically relocated people in Alatou city is compliant with IFC PS5 requirements. The consultant, within the scope of RAP, will also assess the land acquisition requirement for the 18 OHTLs to be diverted and develop necessary measures in line with IFC PS5 requirements and will be integrated into the RAP including LRP. 

The additional mitigation measures which will be provided to people affected by land acquisition and physical resettlement will include providing employment opportunities in construction and operation phases of the project. KTZ will ensure the workforce hiring plans for construction and operation phases of the project includes mechanisms for maximizing the employment of affected people where feasible based on workforce needs and skills required as per ESAP #14.

KTZ will employ a competent social specialist who will be responsible for managing and coordinating the actions to be taken by the company and other entities within the scope of the RAP including LRP in line with requirements of IFC. The specialist will also act as a Community Liaison Officer to liaise with GoK and local government offices, manage community grievances and undertake the necessary public consultation activities when needed during the implementation of RAP and LRP as indicated in ESAP #15.

The company will hire an external consultant to monitor the implementation of RAP including LRP and provide reports on a quarterly basis. At completion of the land acquisition and resettlement related plans and programs, the consultant will carry out a completion audit to verify the expected outcomes achieved as per the requirements of IFC PS5 (ESAP #16 and 17).

PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources 

The project is situated in the deserts and xeric shrublands biome of the Central Asian northern desert ecoregion (Resolve, 2017). The railway alignment passes through a mosaic of Natural and Modified Habitat. Areas of Natural Habitat (NH) include semi-desert, steppe grassland and riparian habitats. The semi-desert habitat patches are characterized by drought-resistant grass species. The project crosses streams in various locations but only one location around the last few kilometres of the alignment (43°37'20.50"N, 77° 4'47.64"E) has extensive reed beds. The project has a partial overlap with Sorbulak Lake System Key Biodiversity Area (KBA)/Important Bird and Biodiversity Area (IBA), where an approximately 5km section of the alignment passes through the lower reaches of the KBA, which is about 10 km to the south of the KBA’s wetlands.

Biodiversity surveys and assessments have been carried out within the scope of the Supplementary ESIA studies in September-October 2024, which also included consultations with local biodiversity CSOs. Priority biodiversity values associated with the project have been identified as the Common Hamster (IUCN Red List – Critically Endangered), Severtsov's Loach, Plain Thicklip Loach, Seven River's Minnow, Central Asian Tortoise, Asian Houbara (all IUCN Red List – Vulnerable), the endemic tulip species, Tulipa buhseana (IUCN Red List-Not Evaluated), and migratory waterbirds and raptors. IFC Natural Habitat No Net Loss (NNL) requirements will apply to these priority biodiversity values and the semi-desert and riparian habitats. The approximately 4-km section of the project that overlaps with the Sorbulak Lake System KBA, crosses through semi-desert and steppe grassland habitats, where the nearest KBA wetland is around 5 km to the north. Therefore, impacts related to construction and operations of the railway are not anticipated on threatened and migratory waterbirds associated with the KBA.

In preparation of the Supplementary ESIA, an initial set of mitigation measures were defined for areas of Natural Habitat to be implemented in railway sections where construction had not started. These include avoidance and minimization of imminent risks and impacts from ongoing project activities on the semi-desert and riparian habitat features and priority biodiversity values (i.e. tulip, fish, Central Asian Tortoise, Common Hamster, and nesting birds). A project specific construction-phase Biodiversity Management Plan (BMP) has been developed to set forth measures to be implemented throughout the rest of the construction phase of the Project.  These measures will address potential impacts on priority biodiversity values during vegetation clearance, including pre-felling inspections in the riparian zones, and avoidance of activities during fauna breeding seasons. Fencing around terrestrial construction areas will be specifically designed and implemented for the Central Asian Tortoise. Around the river crossings, silt fences and sediment traps/barriers will be used to prevent sediment runoff into nearby watercourses, where shoreline belts and water protection zones will also be established in line with the National legislation. The BMP will be aligned with the Pollution Prevention Plan, which will make provisions for surface water quality monitoring. KTZ has appointed a biodiversity specialist, who will be responsible for overall management, implementation and reporting of activities undertaken within the scope of the BMP.

The proposed 1.9-km OHTL will be connecting an existing substation, located at about 10 km to the east of the KBA boundary, to a greenfield substation that will be built further to the east within the last 8-km section of the railway. The OHTL will not be overlapping with the KBA and only a 500-m section of the OHTL will be within the project ROW. To minimize risks of impacts on bird species using the airspace that are also subject to NNL requirements, measures to mitigate collision (e.g. bird diverters) and electrocution risk (e.g. insulation caps, conductor covers) will be implemented using the best available technology. During the operations phase of the project, the key measure for the OHTL will be development and implementation of a robust fatality monitoring program that follows GIIP and is accurately able to generate unbiased fatality rate estimate. For this reason, as indicated in ESAP #18, KTZ will implement a Post-Construction Fatality Monitoring (PCFM) program to monitor bird flight activity, assess effectiveness of mitigation, and identify any further measures to be taken in line with an adaptive management approach. Along the existing low-voltage transmission lines, where there will be re-routing, KTZ will use best efforts to implement measures (e.g. insulator caps, conductor covers) to mitigate impacts of electrocution risks to large birds.

In addition to the PCFM program, KTZ will develop an operations-phase BMP (ESAP #19), which will include a Habitat Restoration Program for semi-desert, steppe grassland and riparian habitats, and associated priority biodiversity values. A qualified expert will be procured by KTZ to develop the Habitat Restoration Program, which will, at the minimum, include: (i) recommendations for restoration measures and opportunities to maintain biodiversity on-site; and (ii) a clear demonstration of how NNL will be achieved. The Company will coordinate with relevant stakeholders in developing and implementing the operations-phase BMP and Habitat Restoration Program, including local CSOs and other local experts, notably for measures to be implemented in the Sorbulak Lake System KBA/IBA, as well as to explore opportunities to support conservation programs within the KBA.

PS 8 – Cultural Heritage

Based on the request from KTZ, Margulan University Institute of Archaeology, conducted two site surveys for a length of 68 km, from the sections between Zhetygen district and Uzynagash village in 2014 and 2024. These surveys conclude that there are no UNESCO designated world heritage sites or nationally designated archaeological sites within the project area. The studies identified three archaeological sites of local significance associated with the remains of the late period of the early Iron Age near the footprint of the Almaty Bypass which are protected historical and cultural heritage sites as per the relevant local legislation. Considering the likelihood of uncovering further cultural heritage resources during ground disturbing activities within the project area of influence, Cultural Heritage Management Framework prepared within the supplementary ESIA, included a Chance Finds Procedure and a Kurgan Archaeological Landscape Mitigation and Management Guideline to be implemented by EPC contractor and its subcontractors as per the requirements of respective national regulations. KTZ will make sure that contractor workforce including sub-contractors were provided with necessary training on the identified archaeological sites around the project area and implementation requirements of the chance finds procedure and Kurgan Archaeological Landscape Mitigation and Management Guideline (ESAP #20).

The construction of the Almaty Bypass was formally announced by the Ministry of Industry and Infrastructure Development in March 2022 while the commencement of construction of the railway announced by the RoK in November 2023. A regional public hearing meeting for the EIA was held on December 27, 2023, where representatives of the EIA consultant, and design consultant, presented the project details, key environmental considerations and possible impacts and addressed the questions posed by the audiences. In addition to representatives of respective local officials, 12 local residents from settlements of the project region attended the meeting.

Several public consultation meetings led by KTZ, District Akimats, and consultants were conducted in Talgar, Iliy, Karasay and Zhambyl districts and Kazibek Bek station between January and April 2024. The outcome of the meetings indicated strong support for the proposed project and the key concerns of the participants included reassurance regarding environmental safeguards and mitigation strategies, social impacts, railway alignment and land acquisition issues, clarity on compensation for tree removal and the specifics of the planned replanting efforts. Details of the public consultation meetings were communicated with the wider public in both Kazakh and Russian via the Unified Environmental Portal (https://ecoportal.kz/).

More recent stakeholder engagement activities as part of the supplementary ESIA studies, included interviews with government officials; focus group discussions with farmers, representatives of small businesses and vulnerable groups; and semi-structured interviews conducted with 46 respondents among the project affected people (PAPs) between October 28, 2024 and January 26, 2025. The four District Akimats of Talgar, Iliy, Karasay and Zhambyl were engaged extensively throughout these consultations.

A Stakeholder Engagement Plan (SEP) was developed within the scope of the supplementary ESIA which is disclosed together with this ESRS. The SEP identifies the general public, individual and community and project level information disclosure, communication and consultation strategies for construction and operation phases of the project. The project grievance mechanism identified in the SEP includes several channels for the affected people to raise their concerns and grievances such as grievance forms to be submitted via the local government (Akimats) offices, by email and through personal delivery to the project office; project hotline; and sending written grievances to the project office. KTZ will appoint a CLO, as per ESAP #15, who will be coordinating the stakeholder engagement in line with the SEP, and support the management of any grievances received from the community.

The company has been a participant member of UN Global Compact since 2012 and has been annually reporting KTZ’s financial, operational, corporate governance and E&S management performance against identified KPIs in Integrated Annual Reports since 2016 (https://railways.kz/en/investors/annual-reports/). The KTZ website presents several ways for communicating grievances including a hotline phone number, mobile application, and a third-party provider’s website (https://nysana.cscc.kz/website) that contain a complaint form. The KTZ website also refers to a hotline website of Samruk Kazyna, KTZ’s parent company (https://sk-hotline.kz/). KTZ’s website also includes a shortcut to “E-Otinish” (https://eotinish.kz/ru), which is the official Kazakh government single-window portal for handling all types of inquiries from individuals to legal entities and government departments. Ombudsman of NC KTZ JSC is also reachable for any complaint or resolution of community conflicts through ombudsman@railways.kz.

Contact Person: Aldiyar Akhmet

Company Name: Kazakhstan Temir Zholy Joint Stock Company (KTZ JSC)

Address: Kazakhstan, Astana, Kunaev street 6. (KTZ office)

Email: akhmet_a@railways.kz

Phone: +7-7172-60-37-37

IFC conducted an Informed Consultation and Participation (ICP), and Broad Community Support (BCS) determination based on both primary and secondary data collection and review, including: (i) the EIA and supplementary ESIA; (ii) available Environmental and Social Management Plans; (iii) review of past engagement records such as minutes of information and consultation meetings; and (iv) a validation visit between May 26 and 28, 2025, to engage with project stakeholders including affected people, representatives of local government entities and civil society organizations (CSOs). IFC has determined that despite the limitations in the ICP process undertaken, there is evidence of support for the project amongst local residents (men and women), and representatives of district governments, based primarily on the project’s expected contribution towards local and national economic development. None of the people interviewed in the context of the supplementary ESIA or directly engaged by IFC indicated opposition to the project, although several affected people conveyed concerns mainly related with land acquisition process including delays in compensation payments, land/community severance, disrupted agricultural production, loss of grazing area, dust and environmental impacts, including the management of wastewater.

To further strengthen ICP as well as maintain and enhance BCS, KTZ committed to the following: (i) appoint a CLO by October 2025, in order to coordinate the stakeholder engagement in line with the SEP, and support grievance management for any grievances raised by the community, (ii) implement the SEP, in order to enhance ongoing engagement and consultation with communities (including vulnerable groups) and improve the Project affected communities understanding of project activities, timelines, potential E&S risks and impacts and mitigants; (iii) build on ongoing engagement and consultation to inform the development and update of management plans and associated mitigation measures, (iv) finalize and implement RAP including LRP based on a budget that will allow the payment of additional compensation in line with PS5, with implementation to be fully completed and audited by December 2026. In addition, as per the ESAP, the needs assessment for additional overpasses and access roads for mitigating impacts of local community severance will also be done in consultation with the people affected in the project area. The full BCS is conditional to the client implementing the ESAP and the above actions.