Javid Gurbanov, the head of the Road and Transportation Service Department, informed Trend that the Azerbaijan Transport Ministry has confirmed a $51 mln contract with the Turkish company Mak Yol for the construction of the Baku Circular Route 1, Trend reports.
The total cost of the project is $59 mln.
Firstly, the project was proposed to be implemented at the expense of a $15.27 mln granted by the Kuwaiti Development Fund and the Arab Development Fund Abu-Dhabi which approved $10 mln. The credit of Arab financial institutions was fixed for 20 years with a 4-year grace period at a rate of 2.5% per year. Azerbaijan may approve funds under the project as its prices have increased by $26.42 mln.
He noted that at present mobilization of the machinery for the project is being carried out. Construction will commence in mid-November 2006.
The cost of the project was clarified after repeated technical investigations of the road were carried out by a designer from a Jordanian company, Arab Consult. The increase in the price of the project is related to the necessity to replace the cables, as well as construction of a 5km section and relevant infrastructure development, which was not included in the feasibility study of the project. It is also planned to construct a new over bridge, which connects the road to a new bus station complex. Some mistakes were made during the development of the feasibility study in 1990s, whereas the price of construction materials and services has risen by 44%-45%.