YEREVAN (RFE/RL)–Armenia is pressing ahead with an extremely ambitious project to build a railway linking it to neighboring Iran, Transport and Communications Minister Gurgen Sargsian said on Tuesday.
The governmen’s of the two countries have been discussing ways of implementing it but have yet to reach final agreemen’s. The lack of a rail link between them is seen as a major hindrance to the development of Armenian-Iranian commercial ties as well as the use of Iranian territory in Armenia’s transport communication with the outside world.
President Serzh Sarkisian announced earlier this month that work on the railway will get underway “in the coming months,” saying that this and other large-scale infrastructure projects are vital for Armenia’s economic development. But he said nothing about the likely cost of the construction and its sources of funding.
Sargsian likewise avoided commenting on these specifics, saying only that the project has reached “the phase of active studies” and that its implementation is a matter of time. He said the Armenian government is currently considering three potential routes of the Armenian section of the would-be railway.
“After choosing one of those variants we could switch to engineering design and cost calculation, which will make construction possible,” Sargsian told RFE/RL in an interview. In any case, he said, the railway will be approximately 400 kilometers long and will pass through Armenia’s mountainous Syunik region bordering Iran.
Citing Syunik’s difficult landscape, economic analysts say building the railway would cost Armenia at least $1 billion, a figure equivalent to about 40 percent of its state budget for this year. Some have wondered if the project is feasible at all.
“We can not come up with concrete estimates today because they would be meaningless without feasibility study documen’s,” said Sargsian. “But obviously it will be an expensive project. In terms of funding, we have a number of options.”
In his words, one such option is to set up a consortium with Iran and Russia, whose state-run rail company took over long-term management of Armenia’s entire rail network earlier this year. The minister added that international finance institutions such as the World Bank and the European Bank for Reconstruction and Development have also expressed interest in partly financing the Iran-Armenia railway.
Armenia’s rail communication with the rest of the world was disrupted in the early 1990s with the outbreak of the conflicts in Nagorno-Karabakh and Abkhazia and the resulting closure of its border with Turkey. The landlocked country has since been able to ship and receive rail cars laden with cargos only through the relatively expensive rail-ferry services operating between Georgian and other Black Sea ports.
In related news, Armenia has not begun imports of natural gas from Iran yet despite claims to the contrary made by Iranian officials, an official in Yerevan said on Monday.
Rasoul Salmani, a top executive at the National Iranian Gas Company (NIGC), was reported to say last week that it will start pumping gas through a newly built pipeline to Armenia on October 13. He said the Armenian side is already supplying electricity to Iran in payment for the gas deliveries.
Lusine Harutiunian, a spokeswoman for the Armenian Energy Ministry, denied this and said natural gas supplied by Russia via Georgia fully meets Armenia’s needs. “So there is no need to import additional gas,” Harutiunian told RFE/RL. She could not say when Iranian gas supplies could start.
Russian gas imports to Armenia totaled just over 2 billion cubic meters last year and are expected to stay at the same level this year. Officials have said the pipeline from Iran will have the capacity to pump at least 2.3 billion cubic meters per annum. With the Russian supplies meeting Armenia’s needs, the Yerevan authorities have always intended to convert Iranian gas into electricity that will be exported to the Islamic Republic.
President Serzh Sarkisian announced the completion of the pipeline’s second and final Armenian section in a wide-ranging foreign policy speech in early September. He touted it as a ground-breaking development that will significantly boost his country’s energy security.
“Thank God, the gas pipeline has already been built, and we can receive gas from the Islamic Republic of Iran as early as tomorrow,” Sarkisian said. “Work on enhancing the capacity of that pipeline will likely end in late October or early November.”