Azerbaijan, Baku, Feb. 25 / Trend , U.Ismayilova/
The signing of a loan agreement worth $673.8 million with the World Bank on a project to assist transit via railway in Azerbaijan was delayed due to its large scale, WB Baku Office head Gregory Jedrzejczak said on Feb. 25.
"The project is complicated requires much time. The agreement will be signed in June," he said.
The WB issued a $450-million loan to realize the project in March 2008. The reason for the delay is the project can only be implemented after adopting a 2008-2013 state program to improve the country's railway infrastructure. The program is worth 1.2 billion manat.
The loan will be issued through the International Bank for Reconstruction and Development for 17 years with a four-year grace period and libor+0.05% interest rate. The Azerbaijani government will pay the remaining funds.
The project covers three components.
The first comprises rehabilitating Azerbaijan's railway infrastructure and a railway section from Baku to the Georgian border, shifting from a 3.3-kilovolt constant stream to a 25-kilovolt variable stream and replacing the signal system to an energy supply system.
Under the second component, plans include purchasing 50 electric locomotives.
The third component comprises upgrading the activity of the Railway Department.
The locan will be gradually paid off through the state budget and $215 million - by the Azerbaijan State Railway (ASR).
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