By Nane Atshemian
Russia and Georgia are close to reaching a long-awaited agreement on restoring their direct railway connection which could significantly benefit the Armenian economy, Russian Transport Minister Igor Levitin said on Thursday.
But he cautioned that the section of the railway passing through Abkhazia is in need of serious capital repairs that would take as many as two years.
The Abkhaz section of the Soviet-built railway was seriously damaged during the 1992-1993 armed conflict which led to the Black Sea region’s de facto independence from Georgia. Until recently Georgian leaders opposed its restoration before a settlement of the conflict. But the administration of President Mikhail Saakashvili appears to have softened Tbilisi’s position on the issue.
Levitin said he will again discuss the issue with Georgian officials during a visit to Tbilisi next week and is optimistic about a positive outcome of the talks.
“If the Georgian side is prepared for the restoration and confirms that to us, Russia, Georgia and Armenia will have to set up a consortium, determine each country’s share of investments in the project and start restoring the railway,” he told reporters in Yerevan. “According to our calculations, [the repairs] could last for two years.”
Speaking at a joint news conference with Levitin, Armenian Defense Minister Serzh Sarkisian said Saakashvili reaffirmed Tbilisi’s commitment to a quick resumption of rail communication between Russia and Georgia and Armenia during his recent informal talks with President Robert Kocharian. “Armenia will certainly participate in the project,” he said.
Sarkisian added that Russia is ready to cover most of the repair costs. “We are not talking about tens of millions of dollars,” he said.
The lack of rail communication with Russia and other countries makes export-oriented Armenian companies less competitive and hampers foreign investment in Armenia’s struggling economy. It is also a serious hindrance to Russian-Armenian economic ties. Hence, Yerevan’s strong interest in restoring the vital transport route.
Sarkisian and Levitin spoke at the end of a two-day session of the Russian-Armenian intergovernmental commission on economic cooperation, of which they are the co-chairmen. Officials said the commission discussed a broad range of economic issues, with the Armenian side again pressing the Russians to make good on their pledge to revive Armenian enterprises which were given to them in payment for Yerevan’s $100 million debt. All of those enterprises except a big power plant used to be part of the Soviet military-industrial complex and are now largely standing idle.
“Russia feels its responsibility for those enterprises. That is one of the obligations which we have not yet fulfilled,” admitted Levitin.
The Russian official said Moscow needs more time to decide what to do with those industries. “We can’t figure out what type of production they should have: defense or civilian or both,” he explained.
Russia’s strong presence in the Armenian energy sector was also high on the agenda of the commission’s session. The two ministers said they discussed in particular the recent controversial takeover of the Armenian power grid by Russia’s state-run power monopoly, Unified Energy Systems, but did not give details.
Levitin was also asked to comment on the Armenian government’s decision not to grant Russia’s Gazprom giant a contract for the construction of a pipeline that will pump natural gas from Iran to Armenia. Work on the Armenian section of the pipeline will be carried out by an Iranian company and financed with a $35 million loan provided by the Iranian government.
“We understand the actions of the Armenian side,” Levitin said. “I consider them logical.”