Azerbaijan, Baku, 11 March / corr Trend I.Khalilova / During the talks with the Azerbaijani Government on additional finance for the project on construction of the second highway the World Bank reaffirmed its readiness to allot $300mln, the Baku Office of WB said on 11 March.
The loan will be allocated though the International Bank for Reconstruction and Development (IBRD) over a term of 17 years with a 4-year grace period and an annual rate of libor+0.05%.
The final budget of the project was coordinated in the amount of $505mln as compared to $515mln defined earlier. Some $205mln of this sum will be covered by the state.
The project envisages completing construction works of the highways Alat-Masalli and Baku-Shemaha-Mugan, and the construction of a second circular road from Sahil settlement to Z.Tagiyev settlement.
An increase of the state share in the project up to 40.6% [earlier the state share was limited to 10%-15%] is related to VAT (18%) with respect to jobs and services implemented by the international loan. The expenses will be covered by state participation in the project.
The first WB credit, within this road project, totaled $200mln - which was allocated on the terms of the International Bank for Reconstruction and Development (for a period of 20 years with a grace period of four years and libor+0.5% interest rate). The Government of Azerbaijan allocated $65mln for the first phase of the project.
The gross cost of the project totals $780mln. The project envisages expanding and changing the highway Alat-Masalli, repair of the Baku-Shemaha-Mugan highway and construction of a circular road from Sahil settlement to Z.Tagiyev settlement.
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