Armenia-Iran railway project considered unprofitable

Armenia-Iran railway project considered unprofitable

Ten years ago, Armenia declared the construction of a railway to Iran as its strategic priority. However, the past decade has made experts doubt the feasibility of implementing this cross-border project. They noticed that there has been an acute shortage of not just investment sources in a rather expensive project, but also of political will. None of the potential external project participants expressed a desire to build the railroad, which will end in Armenia.

This summer, Iranian expert Ehsan Hooshmand said that the Armenia-Iran railway project could help improve the level of Armenia's security, "however, unfortunately, steps in this direction have not been very effective so far."

In addition, Ehsan Hooshmand noted that Iran strives to establish railway communication with Russia, and this can only be done through the territory of Azerbaijan. "There is one important circumstance, Iran sees the construction of this railway only with the financing of the Azerbaijan Republic," the Iranian expert said.

Finally, it became known recently that Yerevan considers the Iran-Armenia railway project economically unprofitable. The head of the parliamentary commission on Financial-Credit and Budgetary Affairs, representative of the ruling Republican Party of Armenia, Gagik Minasyan, said that, first of all, in implementing the project, it is necessary to consider its economic impact: "There are states that implement such large-scale projects, first of all, based on political considerations. We do not have such opportunities. We also did not receive any proposals to invest in the railway construction. Revenues from road maintenance will not cover construction costs. "

The Armenian media writes that the country's government intends to cease cooperation with the Dubai-based investment company Rasia FZE, which was to build a railway to Iran. Armenia's Ministry of Transport, Communications and Information Technologies said that specific deadlines for studying, financing the program, construction and operation were provided within the concession agreement with the company, however, Rasia FZE constantly violated the terms and other obligations stipulated by the agreement.

Meanwhile, it seems that causes of the failure of the railway construction was not so much corporate, as political and economic. Moscow wasn't optimistic about the railroad link between Armenia and Iran, while Baku was very suspicious. Armenia's occupation policy with regard to Nagorno-Karabakh and seven surrounding districts is gradually isolating Yerevan, leaving it beyond the framework of significant cross-border projects. This became apparent after the recent launch of the Baku-Tbilisi-Kars railway, which, according to experts, will allow Azerbaijan to become a regional transport hub through which cargo will be delivered not just to the West-East, but also to the West-South and the West-North.


Vestnik Kavkaza

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