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RUB 400bn Chinese loan for Russia’s Moscow–Kazan high-speed rail project

China will provide a RUB 400 billion (EUR 5.2 billion) loan for Russia’s Moscow–Kazan high-speed rail line construction project. The decision was taken during the Russian-Chinese working group on high-speed railway cooperation met in Beijing this week. The Russian delegation was headed by Russian Railways First Vice-President, Alexander Misharin and Transport Deputy Minister, Alexei Tsydenov. The Chinese delegation was headed by Deputy Chairman of the State Committee for Development and Reform Commission, Hu Tszutsay and China Railway Vice General Manager Huang Min.

“The Chinese side will provide a financial loan equivalent to 250 billion rubles for the Moscow-Nizhny Novgorod section and an amount equivalent to 150 billion rubles for the Nizhny Novgorod-Kazan section. The sides discussed possibilities of financing the project in US dollars and in yuan,” Russian Railways informed. As part of the agreement, China will also provide RUB 53 billion rubles in equity financing.

The working group also reviewed the key issues of Moscow – Nizhny Novgorod – Kazan  high-speed rail design based on the main objective of the project,  selecting the optimal technical solution while minimizing the required construction costs.

rzd high speed train moscow kazanRussian and Chinese experts have also discussed railway automation and remote control solutions, signaling and communication systems, train control solutions for high-speed railway.

The project will be implemented as a public-private partnership (PPP model) through a concession. A special project company will be set up, the concessionaire, with the objective to conclude and carry out the agreement on the construction of high-speed rail Moscow – Nizhny Novgorod – Kazan. The the project will be implemented by attracting investments in the form of equity and debt financing.

Key points of the concession agreement will be included in the agreement to be signed by the Russian Federation and the People’s Republic of China in 2016.

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