Moscow Times
Nov. 4, 2004

Railway Venture Aims to Link Up Caucasus

By Lyuba Pronina
Staff Writer

The transportation ministries of Russia, Georgia, Armenia and
Azerbaijan are entertaining ambitious plans to revive through traffic
on the Trans-Caucasus Railway, which was severed by the outbreak of
wars in Abkhazia and Nagorny Karabakh.

“The countries’ presidents, transportation authorities and business
representatives have expressed support for this project, which will
revitalize transport links between our countries,” Transportation
Minister Igor Levitin told reporters in Moscow on Wednesday after
visiting Georgia earlier this week.

Levitin said that a company would be set up to restore and operate the
Trans-Caucasus Railway, which crosses the territory of Georgia and
Armenia and has access to Turkey’s railway network.

Russian Railways, or RZD, will participate in the company from the
Russian side, Levitin said.

The railway, which stretched more than 2,300 kilometers in Soviet
times, connected Black Sea ports with central Russia, operated
passenger services to vacation resorts and handled more than 15 million
tons of transit cargo per year.

“Since 1992, there has been no through traffic from Sochi to Tbilisi
and to Yerevan and Baku. There are no bridges, many parts of the track
are mined. … All of this will have to be restored, about 200
kilometers,” Levitin said. He said that Georgia has promised to provide
information on the condition of the railway later this month.

“At present, transport systems handling Asia-Europe transit bypass the
transport infrastructure of Russia and the Trans-Caucasus. If we don’t
start dealing with this problem, we could lose huge transport flows,”
Levitin said.

Russia and Georgia on Monday signed a memorandum to restore rail
connections from Russia through Abkhazia to Georgia, severed in 1992.

The sides have agreed to set up a working group between Russia, Armenia
and Georgia on resuming rail traffic between Sochi and Tbilisi, the
Transportation Ministry said.

Separately, RZD president Gennady Fadeyev signed an agreement with his
Armenian counterpart, Ararat Khimryan, in Yerevan on Wednesday to set
up a cargo joint venture. The two sides agreed to set up a working
group by Nov. 20 that will produce a business plan for the new company.

The company will be open to outside investors and will help rebuild
infrastructure on the railway line between Veseloye on the
Russia-Abkhaz border, to Sukhumi and on to Yerevan.

Fadeyev and Armenian Prime Minister Andranik Margaryan also discussed a
ferry service between Russia’s port of Kavkaz on the Kerch Strait and
the Georgian port of Poti.

Fadeyev said that the Kavkaz-Poti route would reduce shipping times by
seven days and would offer more competitive prices. The cargo turnover
between the two ports could reach 500,000 tons per year, the
Transportation Ministry said.

RZD on Wednesday posted a net profit of 16.6 billion rubles ($577
million) over the first nine months of this year.