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Azerbaijani Transport Minister: Cost of Baku-Tbilisi-Kars railway project to be revised

Business Materials 25 January 2011 15:55
The cost of the project of construction of the Baku-Tbilisi-Kars railway, which will connect the railway systems of Azerbaijan, Georgia and Turkey, will be revised, Azerbaijani Transport Minister Ziya Mammadov said today in Tbilisi, as a result of consultations within the project. The meeting was attended by the Azerbaijani delegation headed by the Transport Minister and the Georgian delegation led by Minister of Infrastructure and Regional Development Ramaz Nikolaishvili.
Azerbaijani Transport Minister: Cost of Baku-Tbilisi-Kars railway project to be revised

Georgia, Tbilisi, Jan.25 / Trend N. Kirtskhalia /

The cost of the project of construction of the Baku-Tbilisi-Kars railway, which will connect the railway systems of Azerbaijan, Georgia and Turkey, will be revised, Azerbaijani Transport Minister Ziya Mammadov said today in Tbilisi, as a result of consultations within the project. The meeting was attended by the Azerbaijani delegation headed by the Transport Minister and the Georgian delegation led by Minister of Infrastructure and Regional Development Ramaz Nikolaishvili.

The Azerbaijani government is willing to provide an extra $500 million to finance the construction of the Georgian section, an Azerbaijan Railways source told Trend earlier. Earlier, Azerbaijan allocated a $200-million loan from the State Oil Fund of the Azerbaijan Republic to construct the section. The loan covers 25 years with an annual rate of one percent.

"Of course, the situation changes and in this regard the cost of the project will grow, as today prices are already different," Mammadov said. The minister did not specify the size of the new loan, noting that this issue will be agreed by financiers.

Mammadov said that in connection with it consultations are already underway, and the two countries' presidents instructed the finance ministers to discuss the issue.

"This issue is still under consideration," Mammadov stressed.

In turn Nikolaishvili said the sides discussed the work, which is underway at this stage.

"Now work is underway on construction of 4-km tunnel on the border with Turkey, also the simplification of customs rules and border crossing rules are being discussed," he said.

Nikolaishvili said that $100 million of $ 200 million allocated to Azerbaijan has been already spent and now the process of planning work on the remaining sum is underway.

Ministers of both countries stated that the Turkish Transport and Communications Minister Binali Yildirim will join discussions on Wednesday.

"This is a very significant project for the region and we will thoroughly discuss the remaining work on the implementation of the project of construction of the railway, which will directly connect Asia and Europe," Nikolaishvili said.

A new 105-kilometer railroad branch will be constructed as a part of the Baku-Tbilisi-Kars Railway. About 76 kilometers will stretch via Turkey, 29 kilometers through Georgia. Moreover, an Akhalkalaki-Tbilisi-Marabda railway section will be reconstructed in Georgia to increase transport capacity up to 15 million tons of cargo a year. A point of train transition from the existing train tracks in Georgia to the European one is planned to be built in Akhalkalaki.

The construction of the Baku-Tbilisi-Kars Railway, which will connect the railway systems of Azerbaijan, Georgia and Turkey, will be completed in the first half of 2012, Transport Minister Ziya Mammadov told Trend earlier. But,

despite the agreed terms of the implementation of the project, the sides are working to accelerate the process and complete most of the operations by late 2011.

The corridor's peak capacity will hit 17 million tons. Initially, its capacity will reach 1 million passengers and 6.5 million tons of cargo.

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