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Azerbaijan raises stake in engine stock upgrade project

Business Materials 27 April 2006 16:55

Azerbaijan is considering the opportunity of raising the stake in the engine stock upgrade, Trend reports quoting Musa Panakhov, first deputy Transport Minister of Azerbaijan. Panakhov said Azerbaijan today is willing allot AZM 10mln from internal funds for this project. However, this amount still may be revised.

These funds may be issued from the state budget upon the revision of the project. Azerbaijan is anticipated to provide up to one-half of the project amount.

On April 25 EBRD postponed examination and approval of the second railroad credit till June 2006. By this time Azerbaijan will supposedly revise its budgetary

indices.

EBRD is planned to issue a credit in amount of $30mln for modernization, reconstruction and upgrade of engine stock of the railroad for a period of 15 years with first four years on preferential terms. Interest rate on credit is Libor +1%. During the second phase of the project ASR expects to receive more $20mln. These funds will be spent for establishment of two repair depots in Baku. European bank already issued the railroad a credit at $20.2mln in 1999. At the moment the government is repaying this credit.

Engine park shall be upgraded due to the annul increase in cargo transportation along TRASECA corridor and close opening of the projects like Kars-Ahalkalaki- Tbilisi-Baku route and North-South line.

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