RUSSIAN railway reform reaches a key stage on May 18, when new laws come into force paving the way for creation of Russian Railways as a public company. RZD should be operational as a public company before the end of this year. Announcing the date on April 8, head of the Railway Ministry’s economics department Boris Lapidus outlined investment plans for the network.
The move marks the transition to the second phase of the reform programme begun in 1998. So far this has been concerned with development of basic law to regulate railway activities and the huge task of compiling a new inventory of railway assets. Work continues to determine the industry’s future organisation, economic structure and tariff policy.
Railway assets are valued at almost 1·6 trillion roubles. Nearing completion is the task of determining which are to be transferred to the authorised capital of the new company, and which are to be sold off to fund investment. It is envisaged that RZD’s first bond issue could take place in 2005.
A comprehensive overhaul of infrastructure and rolling stock is expected to absorb around 200bn roubles a year for the remaining seven years of the restructuring programme. Expenditure of 110bn roubles is budgeted for the current year, of which 9bn will come from external sources. In 2004, the ministry’s spend will rise to 150bn roubles, supplemented by 20bn roubles from access charges paid by private freight operators.
- Now electrified throughout, the Trans-Siberian Railway is seen as a prime source of external funds. Fears over the Iraq war boosted container traffic by 175% in the first quarter of 2003, and ministers see a big opportunity for Russian companies to compete strongly for transcontinental business. A second daily Beijing - Moscow container train is now running, and a Nakhodka - Kaliningrad service starts shortly, carrying KIA Motors car parts from South Korea to its Kaliningrad assembly plant.