Train to Gyumri Acts as Freight Carrier for Residents, Says Papikyan

The Armenian government plans to allocate 351 million AMD for the development of the South Caucasian Railways CJSC within the 2020 budget. During a discussion in the National Assembly on the budget draft, Minister of Territorial Administration and Infrastructure Suren Papikyan commented on the relevant article of the budget draft.

“We are constrained by law and are obligated to operate within the legal framework. In this case, we are dealing with a concession agreement. The amount specified here is our concession obligation,” the minister informed the lawmakers.

Papikyan also stated that the issues faced by South Caucasian Railways are among the most critical for the Armenian government that need to be resolved as soon as possible. He emphasized that without the government’s subsidies, the operations of the South Caucasian Railways would simply be impossible.

“When the train travels from Yerevan to Gyumri, it operates at a loss. We are aware of this. However, if Armenia does not subsidize, the operations of that train will be suspended. We are now taking steps to make these expenses more efficient, working on having the rolling stock that serves our citizens be modern, and taking measures to reduce inefficient spending,” said Papikyan.

The minister also noted that today, residents of Ararat and Armavir provinces also use the train to transport their produce to the market. “This means, essentially, that the costs are twice as much. I am currently discussing with our partners that the train, which effectively only acts as a freight carrier, should be limited to Armavir province, allowing citizens to benefit from cheaper transportation to move their produce. Meanwhile, the citizens traveling to Gyumri can benefit from better, more modern, and cheaper transportation,” Papikyan added. He indicated that this is his proposal, which is still under discussion with the Russian side.

The minister recalled that he is scheduled to visit Russia on November 5, where he will discuss the volume of investments in Armenia over the coming years with the General Director of Russian Railways Oleg Belozyorov.

“We anticipate that over the next five years we will be able to secure investments amounting to 30-35 billion AMD in South Caucasian Railways. South Caucasian Railways CJSC is a subsidiary of Russian Railways and manages the concession of Armenia's railway system. According to the agreement signed in Yerevan on February 13, 2008, the term of the concession management is 30 years, with the right to extend for another 10 years by mutual agreement of the parties.”