OREANDA-NEWS. August 28, 2009. Despite the expectations of the  World Bank (WB) , transformation of the Azerbaijan State Railway Company (ADDY) into the Azerbaijani Railway CJSC (ADY) influence the most negatively on realization of Rail Trade and Transport Facilitation Project. WB expects more than a year signing credit agreement on the project with Azerbaijan.

ADY reports that  CJSC was founded recently and still being in the process of solving organizational and legal issues.

"We have neither a structure nor staff schedule as yet as well as personnel appointments are not made. As a result,  cooperation and works with WB are suspended. They can be renewed only after approval of charter and structure of CJSC ad solution of other organization issues,” ADY said.

Restructuring was announced on July 20, and Azerbaijani president gave 2 months to solve organizational issues.

Restructuring of the railway was agreed between the bank and the government. We do not expect negative influence of transformation on realization of the project,” the bank said early August.

Within the Project consultants are invited for the project of power supply replacement via corridor Baku-Beyukesik and services concerning purchase of locomotives and renewal of system of guidelines.

The interested consultants can apply until 12 August 2009 to the ADDY Executive Group (Director: Gurban Nazirov; add: 230, Dilara Aliyeva;

Tel: +99 412 499 63 95 ; e-mail: nq@addy.gov.az;  nahmadova@addy.gov.az.).

More than a year ago the WBG Board of Directors endorsed the USD 450 million loan for Rail Trade and Transport Facilitation Project that has become the WBG biggest one since 1995 when WBG opened financing for Azerbaijan. The loan will be disbursed through International Bank of Reconstruction & Development (IBRD) for 17-year period with 4-year grace term.

The project targets to improve railway services in Azerbaijan, as well as the competitiveness, financial sustainability, operating and cost efficiency and capacity of ADDY. The project with USD 795 million budget was focused on development of corridor toward to Georgia. 90% of the budget will be directed for transport and 10% for industry and trade.

In spring 2008 ADDY chief engineer Gurban Nazirov said that ADDY would have to upgrade its locomotive fleet and replace equipment fully in this line   by buying 50 locomotives as the project stipulates transfer to alternating current when supplying power for Baku – Beyuk Kesik railway line.

Alternating current will allow increase of speed of trains.