Think Railways

RZD plans to investment RUB 28.1 bn in modernisation and rail capacity expansion  projects for Sverdlovsk Railway, its subsidiary. This year the budget was reduced due to the government decision on zero tariff indexation for natural monopolies (RUB 29.3 bn in 2013).*

Among the projects listed:  the reconstruction of railway tracks (RUB 5.6 billion), increasing the capacity of Tobolsk - Surgut - Korotchaevo rail line (RUB 10.2 billion), enlarging the locomotive fleet  (RUB 7.3 billion), modernisation of Yekaterinburg, Perm-1, Verkhoturye and Chusovskaya stations.

* According to URALSIB Financial Corporation, the  zero tariff indexation “means that freight transport tariffs will remain unchanged in 2014, while passenger tariffs will be indexed at inflation minus 30%. As Russian Railways, unlike other natural monopolies, indexes tariffs from 1 January rather 1 July, it will be affected to a greater extent in the initial stages. In subsequent years, tariffs are expected to be indexed at the previous year’s inflation rate. We estimate RUB62 bln will be lost in revenues next year as a result of the tariff freeze, while Russian Railways sees it at RUB 77 bn.”

Source* RZD, photo*panoramio.com