Uzbekistan, Tashkent, Feb. 27 / Trend D.Azizov /
Japan International Cooperation Agency (JICA) and the Government of Uzbekistan today signed the exchange notes on the allocation of 18.067 billion yen ($220 million) for the electrification of the section of Karshi-Termez railway line in the country's south, the Agency said on Monday.
The document was signed by First Deputy Prime Minister and Minister of Finance Rustam Azimov and Japanese Ambassador to Uzbekistan Yoshihisa Kuroda.
The loan was provided for 30 years with a 10-year grace period at an interest rate of 1.2 percent per annum.
Trend reported earlier that the total cost of the project of a 325-kilometre stretch between the two southern cities of Uzbekistan is $388.3 million.
In addition to JLCA loan, the project will be funded by Uzbekistan Railways' funds worth $167.7 million. The plan should be up and running by 2018.
As was previously reported, Uzbekistan plans to electrify three railway sections in the south of the country- Marokand-Karshi running to 140 km, Marokand-Navoi-Bukhara - 250 km and Karshi-Termez - 325 kilometres worth over one billion dollars.
It is planned to attract funds from the Asian Development Bank (ADB) and Japan International Cooperation Agency (JICA) totalling $520 million, including the ADB under the multi-tranche financing of $350 million for these projects.
It is estimated that implementation of these projects will increase by 1.2 times passenger and freight traffic in the south of the republic, where currently a number of large investment projects are being carried out, as well as to increase the transit of goods coming through the territory of Uzbekistan to neighboring Afghanistan.
In August 2007 Uzbekistan Railways commissioned "Tashguzar-Baisun-Kumkurgan" railway worth $447 million and with a length of 223 kilometers, which linked the two southern regions of the country - Kashkadarya and Surkhandarya - bypassing the territory of Turkmenistan, reducing the former distance of passenger and freight traffic by 170 kilometers.
The project is financed by a loan from Japan Bank for International Cooperation (JBIC) amounting to $151.5 million, the state budget and Uzbekistan Railways.
Uzbekistan plans to electrify about 2,000 kilometers of railways worth $1.064 billion till 2017.
The projects will be financed by "Uzbekistan Railways" at $635 million, as well as due to attracting foreign investment and loans from international financial institutions at $429 million.
The total length of railways in Uzbekistan is 4.200 kilometers, including electrified - 930 kilometers. About 60 percent of turnover in the country and almost 80 percent of the total international freight traffic fall to the railways in Uzbekistan.
JICA is a government agency of Japan for technical assistance, providing aid grants and loans to developing countries. Since 1993, with the assistance of JICA, more than 1,600 Uzbek specialists have been trained in Japan, grants of free aid in education, health, agriculture and transportation totaling $280 million and $1.631 billion in loans for projects in transport, energy, telecommunications and education were allocated.