OREANDA-NEWS. June 24, 2014. International cooperation during the implementation of a major infrastructure project such as the development of a high-speed rail connection was discussed at the IX International Rail Business Forum "1520 Strategic Partnership".

"To date, there are at least 3-4 conglomerates interested in cooperating with Russia on the project to create a high-speed connection between Moscow and Kazan. The fact that today we are dedicating a special session to consider this very issue reflects the significance which is attached to this project," said the president of Russian Railways Vladimir Yakunin.

Yakunin also recalled that the financial model for the Moscow - Kazan high-speed line had been reworked and sent to the government, where it had received the support of the Ministry of Transport and the Ministry of Economic Development.

The Forum also held a discussion on the "Macro-Effects of High-Speed Communications," which covered the specifics of constructing and operating high-speed railways in Russia, the multiplier effect of such projects and their impact on the economy.

Alexei Tsydenov, Russia's Deputy Minister of Transport, noted that plans for the development of a high-speed network were included in documents such as the "Forecast of Socio-Economic Development in the Russian Federation until 2030", "The Transport Strategy of the Russian Federation" and the "General Plan for the Development of the Rail Network."

The network includes the lines between Moscow – Kazan – Yekaterinburg, Moscow – Rostov-on-Don – Adler and Moscow – Tver – St. Petersburg, which cover regions containing two thirds of Russia's population.

"In the framework of the budget process for 2015-2017, the Ministry of Transportation has filed an application for the appropriate budgetary funds for the design and construction of the Moscow – Kazan line," said Alexey Tsydenov.

Russian and international auditors confirmed the assessment that the construction of the Moscow – Kazan line would cost 1.06 trillion roubles, with the state investing about 380 billion roubles in various forms such as subsidies, investments, guarantees and money from the Pension Fund of the Russian Federation and Russia's National Wealth Fund etc.

At the moment, the main task is the organising the engineering research and developing the project documentation, which require public funding.

Valery Seleznev, the First Deputy Chairman of the Committee on Property of the State Duma, said that the state should help not only financially, but also provide certain tax breaks.

"This reduces the tax burden by establishing a zero VAT rate in relation to the use of infrastructure, allocating budget subsidies for the design, construction and operation of rail lines to revenues which are not taken into account in determining the tax burden, and freeing the railway infrastructure from property tax," said Valery Seleznev. "And this last measure will bring the railways into line with other types of passenger transport, since the only type of transport infrastructure which is taxed is the rail sector."

Alexander Misharin, First Vice President of Russian Railways, said that the Moscow – Kazan high-speed line project would have a significant impact on economic development and that the government's investment would therefore pay off quickly enough at the macroeconomic level.

"The appearance of a new form of transport with speeds of between 300-400 kpm will result in numerous multiplier effects: changes in the standard of living and wages and an increase in the cost of property etc. Calculations show that in the first 10 years, Russia's GDP will grow by an additional 11.7 trillion roubles, which is 1% per annum, as well as 3.8 trillion roubles in additional budget revenues, including as a result of the increased mobility of the population and the development of technology," he said.

When under construction, the Moscow – Kazan high-speed line will create more than 370,000 jobs in various sectors, including 120,000 in the regions through which the line will pass and 155,200 in the manufacturing industry.

During the operational phase, 5,600 jobs directly involved in transportation along the high-speed line will be created, along with a further 174,500 in related industries.

This modern form of transport will also open up countless new opportunities for small and medium businesses in the areas through which its passes.