MOSCOW, July 31. /TASS/. The Armenian government is prepared to take the issue of operating the country’s railways, which are managed under a concession by South Caucasus Railway, a subsidiary of Russian Railways, to arbitration if it cannot be resolved in an amicable manner, Armenian Prime Minister Nikol Pashinyan said. He also suggested that Yerevan could seek $2 bln per year.
Russian Economic Development Minister Maxim Reshetnikov described Armenia’s demands for additional payments as groundless.
Russian Railways intends to continue operating under the terms of its railway concession agreement with Armenia. However, if the agreement is amended or terminated at Yerevan’s initiative, the company is entitled to expect reimbursement of its investments, Russian Railways CEO Oleg Belozerov told TASS.
TASS has compiled the key facts about the situation.
Pashinyan’s statements
- The Armenian government is prepared to take the issue of operating the country’s railways, which are managed under a concession by South Caucasus Railway, a subsidiary of Russian Railways, to arbitration if it cannot be resolved in an amicable manner, Pashinyan said.
- He suggested that Yerevan could seek $2 bln per year from Russia.
- Pashinyan said he expects the issue involving South Caucasus Railway to be resolved in a friendly atmosphere.
- According to him, Armenia should be able to use the railway as it sees fit.
- Pashinyan did not rule out that, under certain circumstances, Yerevan might be forced to make "de jure decisions," but did not elaborate.
- He said Armenia has the right to use any lawful means available.
- On February 13, Pashinyan told reporters that Yerevan had proposed that the Russian side sell its railway concession in Armenia to a country that maintains friendly relations with both Moscow and Yerevan.
- He named Kazakhstan, the United Arab Emirates, and Qatar as possible options.
- Pashinyan maintained that Armenia has nothing against Russia but argued that the Russian concession creates "certain competitive disadvantages" for the republic.
Response from Russia’s Economic Development Minister
- Russian Economic Development Minister Maxim Reshetnikov said Pashinyan’s remarks provide an opportunity to recall the significant benefits Armenia’s economy derives from membership in the Eurasian Economic Union (EAEU) in general, and from trade with Russia in particular.
- He stressed that Armenia’s demands for additional payments from Russia related to South Caucasus Railway are groundless.
- Reshetnikov noted that South Caucasus Railway is "not a ‘free’ asset of a Russian company, but an enterprise in which we have already invested more than 30 bln rubles."
- He emphasized that if the obligations are revised unilaterally, thereby causing investment losses, Russia would have grounds to seek compensation.
Russian Railways’ position
- Russian Railways intends to adhere to the terms of the railway concession agreement with Armenia. However, if the agreement is amended or terminated at Yerevan’s initiative, the company is entitled to expect reimbursement of its investments, Russian Railways CEO Oleg Belozerov told TASS.
- Investments from Russian Railways’s own funds and the revenues of South Caucasus Railway totaled about $396.3 mln between 2008 and 2025, and this amount is fully documented, he said.
- Belozerov also noted that repairs to the Armenian railway network following the Debed River flooding were financed through Russia’s Reserve Fund.
- In addition, he said that 27 new railcars manufactured by Transmashholding were delivered to Armenia in 2021, while four new EP2D electric trains were purchased over a period of several years.
- Belozerov stressed that South Caucasus Railway is one of Armenia’s largest and most significant employers.
Concession agreement
- In February 2008, Russian Railways and Armenia signed a concession agreement in Yerevan transferring management of the country’s railway system to South Caucasus Railway.
- Under the agreement, the concession runs for 30 years, with an option to extend it for another 10 years after the first 20 years of operation, subject to mutual agreement between the parties.
- On April 2, Russian Deputy Prime Minister Alexey Overchuk told TASS in an interview that there are no objective reasons to sell the South Caucasus Railway concession to a third party.