SOUTH CAUCASUS RAILWAYS – MANAGER OF THE ARMENIA-IRAN RAILWAY
by Gayane Sahakyan

Aravot
Dec 6 2008
Armenia

Statements of state leaders about the construction of the Iran-Armenia
railway are attempts to mislead the people. Some economists argue
that up to now, the government has not pointed out specific financial
sources for the construction of this project.

No budget earmarked for project

Besides, analysts believe that the construction of the railway
requires quite a big amount of money, and the next year’s budget has
no corresponding provisions. They believe that although statements
alleging Russia’s readiness to support the construction of the railway,
the Russian state budget does not envisage this either. Besides,
Russian Minister of Transport Igor Levitin has said quite recently
that they will not carry out such a policy.

We tried to clarify from Minister of Transport and Communications
Gurgen Sargsyan how realistic this project is and at what stage the
design work of the Iran-Armenia railway is. Sargsyan said: "All big
and good projects have been stalled at the initial stage. It is true
that it is quite expensive for our republic, but the global experience
shows that such projects are not implemented alone, not a single
state deals with such an issue on its own. The construction of the
railway has fundamental regional importance and aims at connecting
Asian countries with Europe. One of its importance is that Armenia
will become a transit country for cargo and passenger transit and
will ensure transport from Asia to Europe via Armenia. There is no
other route that would ensure such a transit at present."

Financial institutions ready to fund project

In a reply to a question on funding the railway construction, Sargsyan
said: "Naturally, our state cannot implement such a project on its own;
however, taking into consideration its significance, fortunately, there
are states and finance organizations, which are ready to co-finance the
construction. At present, the Asian Development Bank shows interest in
financing a feasibility study of the project and also participation in
the construction in the future. Discussions have been held with the
World Bank and the European Bank for Reconstruction and Development
as well."

As for that Russia does not have a real desire to take part in the
project, Sargsyan said: "There is no point to speculate on this issue,
there is a fact recorded. This issue was discussed during the meeting
between the Armenian and Russian presidents, and [Russian President]
Dmitriy Medvedev clearly said in this regard that let’s clarify what
amount of money is needed so that we are able to elaborate the degree
of our participation in the project. According to Sargsyan, Iran is
also interested in implementation of this project.

[Passage omitted: Sargsyan said Armenia and Iran will have discussions
on the design of the railway]

Construction of railway would stimulate economy

Sargsyan is sure that our economy will essentially develop due to the
construction of the railway: "The railway is of strategic significance
for the development of economy. If we are a transit country, everyone
will use this route, as there is no other alternative route. At
present a railway line, which goes from China via Middle East and
connects to Iran’s railway network, is being constructed and we have
an opportunity to become a corridor – from the Black Sea, Europe to
China – via the railway line. This is a very serious transport route."

[Passage omitted: Sargsyan puts the construction of the China-Iran
railway at about 1.5-2bn dollars]

The minister said that by the end of 2009, we will have some solution
regarding the construction of the railway. As for the issue who will
operate the new railway, Sargsyan said: "The South Caucasus Railways
[a Russian railway company]. It will be logical if this is done by
this concessionaire, which operates our railways. I do not think that
there will be two operators for a few kilometres of the line. However,
the final decision will be made at a political level." Sargsyan did
not wish to speak about disagreements regarding the operation of the
South Caucasus Railways and the activities of the company.

While answering our question how realistic he himself considers the
implementation of the project, Sargsyan said: "As a citizen, minister
of transport and communications, I am personally quite enthusiastic
about this project and will do my best so that it comes true by
all means."

[Passage omitted: Armenia is optimistic about the project]