Kenya Railways will in the next two weeks start the upgrade of the old track from Nakuru to Kisumu after dropping the use of external contractors.
Philip Mainga, the Kenya Railways managing director, said that the refurbishment of the rail network, which is more than a century old, would start on August 1 and take eight months.
The project marks a policy U-turn given that the State earlier ruled out reviving the line that had fallen into disrepair.
Mr Mainga told the Business Daily that Kenya Railway engineers and National Youth Service will refurbish the line in a bid to cut the upgrade cost.
Initially, Kenya had plans of tapping the Chinese for the upgrade. The 216km line will connect to the recently refurbished Sh3 billion Kisumu port, which will enable ferrying of cargo and passengers to Uganda, Rwanda, Burundi and Democratic Republic of Congo on ships via Lake
Kenya dropped its plan to extend the standard gauge railway (SGR) to Kisumu and later on to the Ugandan border after failing to secure a multi-billion shilling loan from China, which funded the first and second phases of the project.
The old line, which had a thriving passenger service in the 1990s, will form the major supply route to deliver cargo to the neighbouring countries through the Kisumu port.
Plans to upgrade it came after Uganda also announced that would start refurbishing the old rail network to boost bulk cargo transportation, after failing to secure $2.2 billion in Chinese funding for a new SGR line.
Mr Mainga said Kenya will fund the upgrade of the Kisumu line from internal resources, cutting reliance on Chinese loans for railway projects.
The old line from Naivasha to Malaba has been operational but is in bad condition, limiting the cargo volumes and train speeds.
The track from Nakuru, which goes through Njoro, Londiani, Muhoroni and terminates at Butere, has not been in use.
A cargo rail business is critical in making the Kisumu port a viable public investment.
The port is ready for use, but its official launch has been delayed. It is expected to raise the fortunes of the western Kenya city as a regional economic hub.
The port will make Lake Victoria a crucial transport corridor in the shipment of general cargo into and out of the East African region.
Some of the goods that Kenya plans to export via the port are fertiliser, cement, rice, edible oil and general dry cargo such as spare parts. Kenya opened the Mombasa-Nairobi SGR line in 2017 and another new line to Naivasha last August.
It plans to link the old railway track to the SGR line in Naivasha for seamless cargo movements to the neighbouring countries.