By Anna Saghabalian
Armenia’s underused rail network will be officially placed under the management of Russia’s state-run railway next week, Transport and Communication Minister Andranik Manukian indicated on Thursday.
The Russian Railways company is the only foreign bidder participating in an international tender for the exclusive right to manage the network for at least 30 years. An Indian company, which also submitted a bid to the Armenian Transport Ministry last, pulled out of the tender in November, all but predetermining its outcome.
According to Manukian, a ministry commission handling the tender opened sealed envelopes containing the Russians’ proposals late last month and this week and will announce its final decision on January 16. He said they are offering to invest $230 million in Armenia’s railway during the first five years of operations and another $240 million in the following years. Russian Railways will also pay the Armenian government $1.7 billion drams ($5.5 million) if it wins the management contract, he said.
“I think they made a very good proposal,” Manukian told reporters. “I am convinced that Russian Railways will restore our infrastructure, provide new trains and repair stations and depots.”
Manukian emphasized that the Russians’ investment commitments are based on the assumption that Armenia will have no rail communication with Turkey and Azerbaijan and that the Abkhaz section of Georgia’s railway linking the region to Russia will remain closed in the foreseeable future. He said they pledged to invest as much as $2.1 billion in Armenia if those rail links again become operational.
The minister also said that the Russian company expects Armenia to have renewed rail communication with Turkey and Azerbaijan in 2009 and 2010 respectively. He refused to comment on this optimistic scenario, referring all questions to the Russian side.
The impending rail deal will leave yet another sector of the Armenian economy under Russian control. Russian firms already dominate Armenia’s energy and telecommunication sectors and are keen to acquire other industries. One of them purchased Armenia’s largest gold mining company late last year. Few details of the deal have been made public so far.