OREANDA-NEWS. March 31, 2014. A ceremony has been held to mark the beginning of the construction and electrification of the second railway line from Pancevo Bridge in Belgrade to the Pancevo Main Station.

The ceremony was held in Pancevo in Serbia and attended by Vladimir Yakunin, President of Russian Railways, Maxim Sokolov, Russian Transport Minister, Tomislav Nikolic, President of the Republic of Serbia, Ivica Dacic, Prime Minister of the Republic of Serbia, Dragoljub Simonovic, Managing Director of Serbian Railways, Sergei Pavlov, Managing Director of International Railways, a subsidiary of Russian Railways, and other officials.

"We are grateful that Russian Railways has been entrusted to participate in the project, together with Serbian Railways, which should form the basis for the further development of the Serbian economy. And this is only the beginning of our work," said Vladimir Yakunin during the ceremony.

"Communication links, especially railway lines, are the basis of our economic cooperation and future relations," said the Minister of Transport of the Russian Federation.

According to Maxim Sokolov, this project is historically and politically significant for the development and strengthening of good neighbourly economic and historical ties between Serbia and Russia

In January 2013, an agreement was signed in Moscow to provide a Russian state export credit to the Republic of Serbia to finance the modernisation of Serbian Railways. The loan is for USD800 million, and the total cost of the infrastructure projects is about USD940 million. Serbia will thus finance about 15% of all the work.

The contract between the RZD International, a subsidiary of Russian Railways which implements the RZD holding company's infrastructure projects abroad, and Serbian Railways to construct the railway infrastructure and the supply of diesel trains was signed on 23 May 2013.

In June 2013, Serbian Railways and RZD International signed an supplementary agreement which provides for the construction and electrification of the second track of the Belgrade - Pancevo railway line. The cost of work on this section is about USD105 million.

During the project, the completion of which is scheduled for 2016, about 15 km of electrified second track, 2 stations and 2 stopping platforms, 5 new bridges, including a bridge over the river Tamis, and an electro-traction substation at Pancevo will be built.

"Modernisation of our railway infrastructure is a priority of the Government of Serbia. Attracting international transit flows will bring additional financial revenues for the railways and increase the attractiveness of the state for foreign investment," said Tomislav Nikolic, President of the Republic of Serbia.

According to Nikolic, the construction of the second track will create the conditions for increasing traffic at the Belgrade railway hub due to the possibility of avoiding traffic jams on the roads. In addition, the efficiency of freight trains will be increased.

On 11 January 2013, at the Russian Finance Ministry, Anton Siluanov Finance Minister of the Russian Federation, and Mladjan Dinkic, Minister of Finance and Economy of the Republic Serbia, signed an Agreement between the Government of the Russian Federation and the Government of the Republic of Serbia to provide the Republic of Serbia with a state export credit in the amount of USD800 million.

Under this agreement, as well as the general agreement signed between Russian Railways and Serbian Railways on 27 March 2012, projects have been launched to construct or reconstruct the railway infrastructure on the territory of the Republic of Serbia, including construction work, as well as the preparation of the working documentation.

The contract between the RZD International and Serbian Railways envisages the construction and electrification of 15 km of the second track of the Belgrade - Pancevo railway line, the reconstruction of six stretches on pan-European Corridors with a total length of 112 km, the reconstruction of existing and the construction of a second new track on the 44 km stretch of railway line between Stara Pazova - Novi Sad and the reconstruction of the Serbian section of the Belgrade - Bar railway line with a total length of 200 km, as well as the supply of diesel trains made by JSC Metrovagonmash (Russia).