The South Caucasus Area includes vulnerable states, torn apart by conflicts, extremism, political and economic instability. Located on the famous Silk Road, these countries, including Armenia, are still simple transit routes for the energy resources, without becoming important economic players, able to impose their own will.
The strong political conflicts in the past with Turkey and especially the military ones in the Nagorno – Karabah region with Azerbaijan have generated the isolation of Armenia’s transport links. The only active transport connections are those to Georgia and Iran. It was only in 2006 that Armenia was included in the Eastern Partnership and can thus obtain assistance from the European Union and financial support from the European Investment Bank for the execution of infrastructure projects. Investments in transport projects with private participation cover infrastructure projects that directly or indirectly serve the public. Armenia has an essential role in the development of new infrastructures and transport corridors, of projects linking the Caspian Sea and the Black Sea regions through or from South Caucasus. Armenia’s internal transport consists of: car, railway, air and urban transport. The most accessible one is railway transport.
Armenia’s membership to COTIF, since 2011, is an important step for the connection of the Caucasus region to Europe.
This year, South Caucasus Railway, a subsidiary of Russian Railways who has been granted the concession of railway transport services in Armenia for 30 years, wants to boost by 18% the passenger transport to Georgia.
Due to the last years’ investments in the modernisation of the rolling stock and railway infrastructure, the travel time between the two countries has decreased and the number of transported passengers has increased, SCR Manager Marat Khakov said. In 2009, the company carried 16,263 passengers, in 2010 – 40,304 and 42,300 in 2011. The travel time between Yerevan and Batumi reduced to 16 hours compared to 20 hours in 2008.
This year, the company bets on a new advantage to attract more passengers, namely the online sale of tickets.
Iran and Armenia will build a railway line which could be 540-km long, out of which 60 km on Iran’s territory and 480 km on Armenia’s territory. The total cost of the project could reach USD 1.7-2 Billion.
The main railway transit line of the region – Adler- Sukhumi-Tbilisi- Kutaisi- Yerevan-Tehran – has been out of operation since 1992. In May 2012, President of Abkhazia Aleksandr Ankvab announced the opening of the borders in the region and, therefore, the above mentioned railway line will be reopened following rehabilitation. Will Armenia benefit from Georgia’s good will? (although it has declared its independence in 1992, Abkhazia is still considered an integral part of Georgia, its independence being recognised by now only by Nicaragua – editor’s note).
“If Yerevan-Moscow train launches ope-ration within the South Caucasus Railways, the annual profit may total about AMD 5 Billion (about USD 13 Million, at AMD 396 / USD 1 rate)”, estimates the head of SCR passenger transportation department Gagik Movsisyan.
Yerevan underground is another project important for the public transport. Yerevan Municipality, Armenia’s Finance Ministry and Karen Demirchyan Yerevan Metro Company signed a loan agreement with the European Bank for Reconstruction and Development on allocation of EUR 5 Million for reconstruction and upgrading of Yerevan underground. The project will be co-financed by the European Investment Bank, European Union investment grants, each providing EUR 5 Million. EBRD, EIB and the EU also financed the first stage of the project, providing EUR 15 Million.
The South Caucasian Railways will invest AMD 13.5 Billion (EUR 26.9 Million) this year to upgrade the railway system, announced the company’s CEO, Victor Rebets. More than 90% of the investment will go to the infrastructure rehabilitation: the repair of tracks, power system, automatic locks – everything that provides security and speed.
According to Rebets, since concession, the company has invested over AMD 72.1 Billion (EUR 143.7 Million) to modernise its railway system.
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