Azerbaijan Bank and Iran agree on $500mln-loan for railway construction

The International Bank of Azerbaijan signed a deal with Tehran on the allocatio of a $500-million loan for the construction of the Rasht-Astara railway section, Azerbaijan’s Deputy Minister of Roads and Urban Development Ali Noorzad said, Sputnik reports.

The Rasht-Astara railway is part of a larger North-South Transport Corridor project, which aims to connect India, Russia, Iran, Europe and Central Asia. At the first stage, the Corridor is expected to transport up to 5 million tons of cargo per year. It will later increase its yearly transportation capacity to 10 million tons of cargo.

"Azerbaijan's Economy Minister Shahin Mustafayev visited Iran in May, familiarized himself with the course of implementation of the Qazvin-Rasht-Astara railway project and now we are discussing the cooperation between Iran and Azerbaijan on construction of the Rasht-Astara section. The International Bank of Azerbaijan will issue a $500-million loan to this project," Noorzad said, as quoted by the Trend news agency.

According to the deputy minister, the generalities have been agreed, and the sides are currently discussing details and loan conditions.

The expected costs of the Rasht-Astara railway section construction amount to about $1.1 billion. According to Noorzad, another railway section of the North-South Transport Corridor — Qazvin-Rasht — is 93-percent-ready and will be completed by March next year.