Iraq has invited foreign companies to compete for a $450 million monorail project in the southern holy city of Kerbala, which hosts millions of Shi'ite pilgrims each year.

The rail line is among many road, railway, port and power projects needed to update decaying infrastructure in Iraq after years of war, economic sanctions and underinvestment.

Taif Abdul-Hussein, head of the Kerbala investment commission, said on Sunday the 18-km monorail would be built from a northern entrance to the city to the main Shi'ite shrines in the central area and then towards the northeastern city entrance.

Kerbala, 80 km (50 miles) southwest of Baghdad, hosts the shrines of two Shi'ite imams and is the site of several major religious rites.

"The project has an economic advantage and will solve the (problem of moving) throngs of people during religious events," Abdul-Hussein told Reuters.

The train would be capable of speeds up to 100 km per hour and the line would have a station every 900-1000 metres, Abdul-Hussein said.

Iraqi officials have ambitious plans for rail lines, including one for a multibillion-dollar Baghdad metro. None has yet been built as the government struggles to provide basics like electricity and water.

In June 2010, the southern city of Najaf awarded TransGlobim International, a privately-owned Canadian consortium, a $600 million contract to build the country's first monorail.

In January 2011, France's Alstom signed a memorandum of understanding to build  metro line above Baghdad's streets. – Reuters