Dačić: Joint projects prove "brotherly relations"

Dačić: Joint projects prove "brotherly relations"

Speaking at a ceremony marking the start of the work on the construction of the second railway track from the Pančevo Bridge to Pančevo, which is funded from the Russian loan, Dačić stated that it was just one of the joint projects between Serbia and Russia, stressing that he was proud the construction of the gas pipeline South Stream began during his government.

"We will continue all the projects that we have started with the Russian Federation and we want new ones as well. So I wish for this work to be finished within the deadline and be another indicator of our successful cooperation and development of our brotherly and friendly relations," he noted.

"The development of the railway is one of the keys of our development and an important factor in Serbia's future economic growth," he pointed out.

"May the friendship between Serbia and the Russian Federation and between the Serbian and Russian people live on," the prime minister concluded.

Construction begins

The upgrade of Serbian railways, financed with a USD 800 million Russian loan, began in Pančevo on Tuesday with the construction of the second track of the Belgrade-Pančevo railway, and works were declared open by Serbian President Tomislav Nikolić.

The ceremony brought together Serbian Prime Minister Ivica Dačić, Transport Minister Aleksandar Antic, Russian Transport Minister Maksim Sokolov, Directors of Serbian and Russian Railways Dragoljub Simonović and Vladimir Yakunin respectively, and Russian Ambassador to Serbia Alexander Chepurin.

President Nikolić noted that an agreement on the USD 800 million Russian export loan for modernization of the Serbian railways envisages the financing of projects worth USD 940 million, which means that it is Serbia's obligation to provide 15 percent of the funds for the works.

Nikolić said that Annex 1 of the agreement refers to the construction of another railroad from Belgrade to Pančevo, and that these works will cost USD 105 million.

"This agreement marks the beginning of the modernization of Serbian Railways, and RZD International, a firm of the state-owned Russian Railways, has been tasked with realizing them," Nikolić said.

Transport and infrastructure are one of the most important sectors- the Serbian transport industry hires around 160,000 people, while nearly 500,000 indirectly live off it.

Russian Transport Minister Maksim Sokolov said on the occasion of the start of works on the overhaul of the railways in Serbia that joint projects will contribute to improving economic and political relations between the two countries even further.

Roads and railways constitute the foundation of our cooperation now and in the future, Sokolov said.

Russian Railways President Yakunin thanked the president and the government of Serbia on their trust and expressed hope that the projects to be funded by the Russian loan will be only the beginning of a long-term cooperation.

Serbian Railways CEO Dragoljub Simonović said that the works planned in the coming period will be conducted on more than 500 km of railway tracks.

The Belgrade-Pančevo section, where the works were initiated on Tuesday, is 15 kilometers long, and its modernization will increase the speed of trains to 120 km/h, Simonović told Tanjug earlier.

The works are planned to be completed in 960 days.

The agreement on the Russian loan was signed in Moscow in January 2013 and it will account for 85 per cent of the value of the works. The loan was granted with the maturity period of ten years and a grace period of four years, with the fixed interest rate of 4.10 percent annually.

The Russian loan will be used to fund a total of five projects: the Belgrade - Pančevo section, the reconstruction and modernization of six sections of Corridor 10 with a total length of 112 km, the construction of a new and the reconstruction of the existing 44 km long railway track from Stara Pazova to Novi Sad on Corridor 10, the reconstruction of the Belgrade-Bar railway through Serbia with a total length of 200 km, and the procurement of new diesel engine trains from Russia worth USD 100 million.

A large number of local companies and the construction industry of Serbia will take part in the works, which are aimed to increase the speed of trains on the railway Corridor 10 to 160 km/h.