Azerbaijan, Baku, 6 January / Trend , E.Ismaylov /
The contractor for the construction of the first stretch (21 kilometer) of Masalli-Astara highway will be determined not earlier than the first quarter of 2010, a source at the Ministry of Transport of Azerbaijan.
This road will be constructed due to the $200 million loan provided the by the Asian Development Bank (ADB) and the participant share of the government of Azerbaijan will total $49 million.
The mission of the ADB is expected to visit Baku in late January to discuss preparations for the start of this road project. In addition to identifying the contractor, the question of land purchase from the population living along the road still remains unresolved.
"The main reason for delaying this process is the disagreement of the population with the amount proposed by the Ministry of Finance to buy the lands. But after the contractor is determined, the problem with lands will also find its solution," a source at the ministry said.
ADB intends to clarify with the government of Azerbaijan the plans to purchase land within the project.
The Masalli-Astara Highway is divided into three sections. However, land must be purchased from the public using budget funds before construction may commence. Thirty million manat was previously allocated for the project. However, the costs will reduce under the new procedures as land prices have decreased in Azerbaijan.
The ADB Board of Directors approved the project Sept. 28, 2007. Under the agreement, the Asian bank issued loans worth $190 million partially from its common resources for 24 years with a four-year grace period and libor +0.6 interest rate. Loans were also issued at $10 million under preferable conditions for 32 years with an eight-year grace period and one-percent interest rate.
Credit for the Masalli-Astara Highway was allocated within the Multitranche Financing Facility mechanism with a sum total of $500 million to finance three road projects. Two projects worth $255.4 million have been coordinated. The bank has provided up to 2014 to use the remaining funds.