North-South Highway/Iran-Armenia Railway

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Russia not decided on funding of Armenian railroad section – South Caucasus Railway

January 04, 2014 | 13:18

YEREVAN. – The Russian railways have not yet decided on the funding of the construction of the Vanadzor-Fioletovo railroad section in Armenia.

“South Caucasus Railway” Closed Joint-Stock Company General Director Victor Rebets told the aforesaid to Armenian News-NEWS.am.

In Rebets’s words, although the technical and economic bases for the project are ready, no decision was made along the lines of Russian President Vladimir Putin’s recent visit to Armenia.

According to the latest estimates, the construction of this railway section may cost $200-250 million. The amount of funding will depend on the construction of tunnels and the options for the route, since it will pass through mountainous terrain.

The 37.8-kilometer-long Vanadzor-Fioletovo railroad section will close Armenia’s northern railway link and reduce, by 70-100 kilometers, the freight route between capital city Yerevan and the Georgian border.

http://news.am/eng/news/185854.html

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Victor Rebets: We have right to operate Iran-Armenia railway

January 04, 2014 | 17:02

South Caucasus Railway (SCR) Closed Joint-Stock Company has the right to operate the Iran-Armenia railway, SCR General Director Victor Rebets told Armenian News-NEWS.am.

The aforementioned right is reinforced by a trilateral agreement, which was signed in early 2013 among the Transport and Communication Ministry of Armenia, the Rossiya investment company, and the SCR.

The SCR parent company, however, has not yet decided on whether to participate in this project.

So far, it has been decided that the CCCC Chinese company will take part in the construction of the railway.

SCR has negotiated with the industrial palace of Iran concerning the organizational matters.

As per Rebets, according to preliminary estimates, the project will cost more than $3 billion.

http://news.am/eng/news/185892.html

[londontsi]

Re: North-South Highway/Iran-Armenia Railway

Victor Rebets: We have right to operate Iran-Armenia railway

January 04, 2014 | 17:02

South Caucasus Railway (SCR) Closed Joint-Stock Company has the right to operate the Iran-Armenia railway, SCR General Director Victor Rebets told Armenian News-NEWS.am.

The aforementioned right is reinforced by a trilateral agreement, which was signed in early 2013 among the Transport and Communication Ministry of Armenia, the Rossiya investment company, and the SCR.

The SCR parent company, however, has not yet decided on whether to participate in this project.

So far, it has been decided that the CCCC Chinese company will take part in the construction of the railway.

SCR has negotiated with the industrial palace of Iran concerning the organizational matters.

As per Rebets, according to preliminary estimates, the project will cost more than $3 billion.

http://news.am/eng/news/185892.html

Does this mean the Armenian Government sold ( again)
all its rights of another asset to outside interests and
therefore will not earn a penny from its operation?

.

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Does this mean the Armenian Government sold ( again)
all its rights of another asset to outside interests and
therefore will not earn a penny from its operation?

.

I'll like to hear from others like Vrej who might know more about that aspect of it. Though my knowledge of that aspect is limited, it seems to me there aren't too many other ways that this project gets built. Without outside support on financing, the construction of a billion dollar project doesn't seem feasible by our government, especially when they have just gotten finished financing the North-South highway from outside sources.

To me, seeing how the project doesn't exist as it is, and the only way that it is going to exist is by outside help, I don't find it that egregious that Armenia might not directly profit of it, seeing how it doesn't currently exist anyway. More important that the direct profit is the ease of doing business in Armenia, of transporting and export/importing good for your business. Meaning its crucial to see this project built, and more of a secondary matter as to were the direct profits are going.

[londontsi]

Re: North-South Highway/Iran-Armenia Railway

I'll like to hear from others like Vrej who might know more about that aspect of it. Though my knowledge of that aspect is limited, it seems to me there aren't too many other ways that this project gets built. Without outside support on financing, the construction of a billion dollar project doesn't seem feasible by our government, especially when they have just gotten finished financing the North-South highway from outside sources.

To me, seeing how the project doesn't exist as it is, and the only way that it is going to exist is by outside help, I don't find it that egregious that Armenia might not directly profit of it, seeing how it doesn't currently exist anyway. More important that the direct profit is the ease of doing business in Armenia, of transporting and export/importing good for your business. Meaning its crucial to see this project built, and more of a secondary matter as to were the direct profits are going.

People who finance infrastructure projects have one of two reasons for doing so.
Either financial return or strategic reasons.
That is fine.

The issue is, you would not let anybody build a hut in you garden and let it out without your agreement and some benefit to you.

I am not suggesting 100% ownership by the government,
but more like a (small?) percentage stake allowing it some financial return and
participate and understand decisions made which may or not not serve the nations interests.


.

[Mher]

Re: North-South Highway/Iran-Armenia Railway

People who finance infrastructure projects have one of two reasons for doing so.
Either financial return or strategic reasons.
That is fine.

The issue is, you would not let anybody build a hut in you garden and let it out without your agreement and some benefit to you.

I am not suggesting 100% ownership by the government,
but more like a (small?) percentage stake allowing it some financial return and
participate and understand decisions made which may or not not serve the nations interests.


.

Ya I definitely understand what you are saying. You always want to have a say in such a industry in your own country. I'll try to find out more about the ownership of the rail network and what role the government of Armenia has in the process and I'll post whatever I find.

[Mher]

Re: North-South Highway/Iran-Armenia Railway

16:59 24/01/2014 » Society
Management Council of North-South Road Corridor Investment Program holds meeting

Chaired by Prime Minister Tigran Sargsyan, the Management Council of the North-South Road Corridor Investment Program held today a regular meeting in the Office of Government.

To begin with, the Council took note of the report on the status of previous session’s assignments.

Then the meeting discussed and made technical amendments to the contract signed with Aegis International. The latter is to provide a feasibility study for a 50km-long road section in the southern sector of Kajaran-Meghri highway under the North-South Road Corridor investment program.

In conclusion, the Council took note of the report on implementation of the EBRD component of a bridge construction project at the Armenia-Georgia border checkpoint of Bagratashen, the government’s press service said.

http://www.panorama.am/en/society/2014/01/24/north-south-road-corridor/

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Russia not decided on funding of Armenian railroad section – South Caucasus Railway
Thursday, January 9

The Russian railways have not yet decided on the funding of the construction of the Vanadzor-Fioletovo railroad section in Armenia.

“South Caucasus Railway” Closed Joint-Stock Company General Director Victor Rebets told the aforesaid to Armenian News-NEWS.am.

In Rebets’s words, although the technical and economic bases for the project are ready, no decision was made along the lines of Russian President Vladimir Putin’s recent visit to Armenia.

According to the latest estimates, the construction of this railway section may cost $200-250 million. The amount of funding will depend on the construction of tunnels and the options for the route, since it will pass through mountainous terrain.

The 37.8-kilometer-long Vanadzor-Fioletovo railroad section will close Armenia’s northern railway link and reduce, by 70-100 kilometers, the freight route between capital city Yerevan and the Georgian border. (News.Az)

http://www.messenger.com.ge/issues/3027_january_9_2014/3027_econ_four.html

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Railway Destinies

Published on Thursday, 16 January 2014 12:37
Category: Articles and Commentary
Written by Magdalena Dąbek

16.01.2014 Traininsukhumi

For over 20 years, there has not been a railway connection between Russia and Georgia. The route connecting the South Caucasus with the southern regions of the Russian Federation was closed in August 1992 along with the start of the Abkhaz-Georgian War. During the past year, the topic of renewing movement on this line returned to the table of political discussion. Its opening would be, on the one hand, a chance to improve Russo-Georgian and Georgian-Abkhaz relations and to terminate the isolation of Armenia, and, on the other, an economic failure. Yet above all in light of Armenia’s accession to the Customs Union of Russia, Belarus and Kazakhstan, it would be another strong link in the Russo-Armenian relationship.

On September 6th 2013, the Secretary of the Council of National Defence of Armenia Arthur Baghdasaryan announced that Russia, Abkhazia and Georgia had agreed to once more open the rail lines connecting the aforementioned countries with Armenia and, eventually, Iran. The Georgian and Abkhaz governments, however, denied such a claim. Although both countries continue to profess interest in inaugurating a rail route, in their opinion the negotiations have not yet been finished.

The Abkhaz internal world

Abkhazia is most opposed to inaugurating the railway connection, yet a key fragment of the tracks runs through its territory. Renewing the course of trains would facilitate Georgia and Armenia’s export of grocery items, mostly fruits and vegetables, to the territory of the Russian Federation, and this would create competition for the Abkhaz export of citrus fruits. Abkhaz tourism – the second branch of the economy giving the country lucrative profits – does not need this rail line. Currently, trains travel to Suchumi and finish their route there, while Russia regularly invests in the development of connections with Abkhazia.

The second reason why Abkhazia consequently waters down the topic of the rail route is its fear of a loss of independence. It is very strongly linked economically with Russia, and so it is not eager to come closer to Georgia, which according to the understanding of most Abkhaz people would end with attempts to once again absorb Abkhazia into its territory. Unsettling are, for example, common economic projects seen as a threat to sovereignty. At the same time, fear may awaken an excessive engagement of Russia in the region: one-quarter of the republic’s budget is direct transfers from Russia, and the large neighbour spends hefty amounts of money on the development of the infrastructure, agriculture and also pensions, and evidently has great influence over the situation in Abkhazia.

The third reason is the awareness that all the financial benefits of transporting commodities across the territory of Abkhazia would probably fall with the participation of Russia. The tracks belong to Russian Railways, and Abkhazia’s Foreign Minister Irakli Khintba has brought up this argument. In December 2012, when Georgian Prime Minister Bidzina Ivanishvili brought up the topic, Russia and Armenia became interested in the matter of the railway. He said that the Abkhazians could participate in the negotiations if the tracks were to fall in their hands. According to Khintba, the decision to initiate the connection could be undertaken by Abkhazia if this were one of the elements of a broader packet of negotiations including, for example, an agreement to not apply violence from the Georgian side.

The rail also has symbolic significance in the Abkhaz imagination: it is said that war came to the country through these tracks. And this has its justification both from the perspective of 1992 and that of 2008.

Georgian vacillations

The idea to “reanimate” the Caucasian railway route came from the Georgian side already during the Shevardnadze government, but it did not then find an answer, and the following events (the Rose Revolution, the Russo-Georgian War) made this perspective more distant. In October 2012, during the campaign to the parliamentary elections, Bidzina Ivanishvili expressed a readiness to open a Russo-Georgian railway connection running across the territory of Abkhazia. Later, he brought up this topic several times: during a visit to Armenia in January 2013 and during a session of the Council of Europe in April of that year.

However, he always stuck to generalities and did not initiate any official negotiations on the topic. Despite regular meetings and negotiations, the Plenipotentiary of the Prime Minister of Georgia Zubar Abashidze and the Deputy Minister of Foreign Affairs of Russia Grigory Karasin did not discuss the railway connection. It could have seemed that Georgia lost its interest in this matter: currently, more important to its development is the Baku-Tbilisi-Kars railway line, and the export of goods to Russia accounts for only five per cent of the trade balance.

The place of economics could be, however, taken by political benefits. In accordance with the words of Paata Zakareishvili, the minister for reintegration, the railway connection could serve to “renew trust” between the Georgians and Abkhazians and also to create a certain alternative for the development of the country. Also regarding the question of improving Russo-Georgian relations, which the former prime minister emphasized and whose policies will probably be continued by his successor, initiating a Sochi-Yerevan connection would be received well by Russia. Georgia must also solve the problem of recognizing boundaries: today, driving into Abkhazia from the side of Psou is illegal. The social response to this idea is interesting: according to studies of the National Democratic Institute, 68 per cent of Georgian respondents support the opening of such a connection.

Armenian hopes

From Armenia’s perspective, a functioning Russia-Abkhazia-Georgia-Armenia railway route is a dream come true. A country that for 20 years has been in isolation and in conflict with its neighbours, Turkey and Azerbaijan, can now breathe a sigh of relief. Such a railway line would solve the transportation problem on the Armenia-Russia line: trade exchange with the Russian Federation accounts for 20 per cent of Armenia’s export and currently is done through land routes through the pass in Larsi (South Ossetia) or by sea in ports in Poti (Georgia) and Bender Abbas (Iran). The good state of the tracks would not require investments from the authorities and even if they would appear, Russia has already announced brotherly help.

During a meeting of the Presidents Serzh Sargsyan and Vladimir Putin on September 3rd in Moscow, the latter promised Armenia 15 billion roubles for investments. In this regard, renewing railway connections would even more strongly link Russia to Armenia, which is already strongly dependent on the former. Freight trains also present a possibility to transport heavy arms and missiles to the territory of the republic where the troops of Russia are stationed – and, from a future perspective, Iran.

The strategic significance of the railway route for Russia’s interests is unquestionable. This does not only mean an easier connection between Georgia and Armenia, but also between Turkey and Azerbaijan. Russia has already once played the Azeri card in its relations with Armenia: in June, the Russia Federation gave Azerbaijan arms whose worth has been estimated to be 700,000 dollars. It is not impossible that with easier communication, Russia could play this card more.

Economic realities

In October 2013, a group of independent experts of the International Alert Organisation undertook research regarding the economic possibilities of renewing travel on the Sochi-Yerevan line. The results practically showed the absolute unprofitability of the investment, especially on the part of Abkhazia. The sum that the government of the republic not recognized by the international community would have to invest in repairs is a not insignificant 251 American dollars. According to the experts’ calculations, with the transport of 10 million tons annually the cost of the investment would be returned after 16 years. The assumption of such a large trade exchange with Russia is, however, unrealistic: if the whole transport of Armenia, Georgia and Abkhazia were transferred to the rail, the amount of commodities would be insufficient for the investment to be profitable. Also, Georgia would have to invest certain resources, yet dramatically smaller ones than Abkhazia. So far, none of the countries has expressed interest in investing in the project, and none except for Armenia has made specific decisions. The question of renewing the Sochi-Yerevan connection is as of yet unresolved, but this idea also has its economic benefits: the stimulation of production, the decreasing of transportation costs and the creation of new jobs. The only question is, is this not with too large a cost?

http://forum.hyeclub.com/showthread.php/9117-Armenia-s-Economic-Pulse/page48?p=348256#post348256

[Mher]

Re: North-South Highway/Iran-Armenia Railway

Iranian President Hassan Rouhani to visit Armenia soon

Historical claims may call into question Azerbaijan’s sovereignty, Iranian Ambassador to Armenia Mohammad Raiesi said in an interview with ArmNews Television Company.

When speaking about Azerbaijan’s claims to Iranian territories, Ambassador Raiesi said in particular: “Azerbaijani officials voicing such problems know that if the matter concerns historical claims, then many similar issues may be raised. In this case the sovereignty of many countries, including Azerbaijan, may be called into question”.

The Iranian ambassador indicated the railway’s issue as one of the major ones in Armenian-Iranian relations. In his words, the issue should included in the agenda of the 12th sitting of the Armenian-Iranian intergovernmental commission. Mohammad Raiesi also spoke about the possibility of abolishing the visa regime between Iran and Armenia.

According to the ambassador, Iranian President Hassan Rouhani will pay a visit to Armenia soon.

http://www.aysor.am/en/news/2014/02/11/hasan-rohani/