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Oversized Cargo Transportation: Few Will Survive 
The total revenue of Russian transport and logistic companies working in oversized cargo transportation sector may amount to USD 250-300 million in 2009, consider analysts from InfraNews research agency. To remind, last year the figure was USD 1 billion.
Nowadays, there are plenty of transport and forwarding companies specialising in oversized and heavy cargoes transportation on the market, and the competition between them is tough. “Now the transport companies get profit and speak about their success, but in the near future the level of competition will increase significantly, and a few market participants will manage to survive. Perhaps, the crisis will destroy some links in the delivery chains, which will allow cargo owners to save money,” write authors of “Research of Oversized Cargo Transportation in Russia in 2008-2009”.
The main consumers of oversized cargo transportation services are enterprises operating in metallurgy, construction, machine-building, energy and petrochemistry sectors. The basic export and import routes for oversized freight transportation cross the ports of St. Petersburg, Nakhodka, and Novorossiysk.

Russia to increase grain export volume
Russia continues growing grain export volumes. In July 2009, the growth index totaled 60%, declared the media-department of CJSC Rusagrotrans. 
According to the analytical centre of Rusagrotrans, in July 2009, the general volume of export grain supplies totaled nearly 1.3 mln tonnes, an increase of 1.6 times compared to indices of the same period last grain year. Rather high carry-over stocks of grains of 2008-2009 harvest became the reason for such growth. In August, grain export volumes from Russia are forecasted at the level of 1.8 mln tonnes. According to preliminary data, in July 2009, railway lines of Russia exported nearly 0.5 mln tonnes of grains, up 25% compared to indices of July 2008. 
In 2009/10, export grain supplies will probably decrease. The reduction is caused by the decrease of the world trading with wheat by nearly 16 mln tonnes (12%) compared to the previous grain year due to high harvests in several countries-importers. Also, in the current year, grain harvest in Russia will not exceed the level of 93 mln tonnes as opposed to 108.1 mln tonnes last season. 
Taking into account rather competitive prices for Russian grains, Rusagrotrans forecasts that in the year Russia will stay at the group of three world leaders of wheat exports with average export volumes of nearly 16 mln tonnes (2008/09 - 18.2 mln tonnes), commented Igor Pavanskiy, the head of the Analytical centre of CJSC “Rusagrotrans”.
Thus, Rusagrotrans is going to invest approximately RUR 8 billion into its wagon park modernisation until 2015. The company plans to purchase new railcars as well as to repair the existing ones. These measures will allow to compensate for the shortage of wagons for grain transportation. Nowadays, there are over 32,500 such wagons in Russia, and only 26,000 of them are used to transport grain. By 2015, just 6,000 of the wagons will remain suitable for transportation. To service export grain flow of 22.4 million tons per annum (this volume was exported in 2008/2009 grain year), over RUR 10 billion (in 2009 prices) is to be invested into purchase and repair of wagons for grain transportation in Russia till 2015.

RZD continues to carry out Trans-Korean Railway reconstruction project
This year OAO RZD continued to integrate into the international transport system actively and to strengthen its role on the international market.
In particular, the company studies several projects concerning Asian and Pacific region, including reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin.
This year OAO RZD and its subsidiaries continued to carry out the pilot project of reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin. In H1 of 2009, the company received from the authorities of North Korea all the necessary permissions; project documentation and the preparation for organizing the construction were completed; the issue of financing the construction works is being studied.
Russian Railways is interested in cooperation with other Asian countries neighbouring the RF. On February 25, Vladimir Yakunin, President of Russian Railways, held working talks in Beijing with Liu Zhijun, the Chinese Minister of Railways.
During the meeting, the sides discussed cooperation between Chinese and Russian railways in the current global financial and economic crisis and emphasised the importance of closer cooperation by increasing rail container traffic between China-Southeast Asia and Russia-Europe. 

Ukrzaliznytsya and OAO RZD: New Project	
The State Administration of Ukrainian Railway Transport (Ukrzaliznytsya) and OAO RZD are studying the project of launching a new route for contrailer transportation from Hungary to Russia. The project was initiated by Hungarian party.
Last April, a Hungarian enterprise Tekiz Zrt offered the top-management of Ukrzaliznytsya to launch a contrainler route to Russia via Ukraine. Destination points are Moscow and Saint Petersburg. The periodicity of transportation is 4 times per month. 
    [~DETAIL_TEXT] => 
Oversized Cargo Transportation: Few Will Survive 
The total revenue of Russian transport and logistic companies working in oversized cargo transportation sector may amount to USD 250-300 million in 2009, consider analysts from InfraNews research agency. To remind, last year the figure was USD 1 billion.
Nowadays, there are plenty of transport and forwarding companies specialising in oversized and heavy cargoes transportation on the market, and the competition between them is tough. “Now the transport companies get profit and speak about their success, but in the near future the level of competition will increase significantly, and a few market participants will manage to survive. Perhaps, the crisis will destroy some links in the delivery chains, which will allow cargo owners to save money,” write authors of “Research of Oversized Cargo Transportation in Russia in 2008-2009”.
The main consumers of oversized cargo transportation services are enterprises operating in metallurgy, construction, machine-building, energy and petrochemistry sectors. The basic export and import routes for oversized freight transportation cross the ports of St. Petersburg, Nakhodka, and Novorossiysk.

Russia to increase grain export volume
Russia continues growing grain export volumes. In July 2009, the growth index totaled 60%, declared the media-department of CJSC Rusagrotrans. 
According to the analytical centre of Rusagrotrans, in July 2009, the general volume of export grain supplies totaled nearly 1.3 mln tonnes, an increase of 1.6 times compared to indices of the same period last grain year. Rather high carry-over stocks of grains of 2008-2009 harvest became the reason for such growth. In August, grain export volumes from Russia are forecasted at the level of 1.8 mln tonnes. According to preliminary data, in July 2009, railway lines of Russia exported nearly 0.5 mln tonnes of grains, up 25% compared to indices of July 2008. 
In 2009/10, export grain supplies will probably decrease. The reduction is caused by the decrease of the world trading with wheat by nearly 16 mln tonnes (12%) compared to the previous grain year due to high harvests in several countries-importers. Also, in the current year, grain harvest in Russia will not exceed the level of 93 mln tonnes as opposed to 108.1 mln tonnes last season. 
Taking into account rather competitive prices for Russian grains, Rusagrotrans forecasts that in the year Russia will stay at the group of three world leaders of wheat exports with average export volumes of nearly 16 mln tonnes (2008/09 - 18.2 mln tonnes), commented Igor Pavanskiy, the head of the Analytical centre of CJSC “Rusagrotrans”.
Thus, Rusagrotrans is going to invest approximately RUR 8 billion into its wagon park modernisation until 2015. The company plans to purchase new railcars as well as to repair the existing ones. These measures will allow to compensate for the shortage of wagons for grain transportation. Nowadays, there are over 32,500 such wagons in Russia, and only 26,000 of them are used to transport grain. By 2015, just 6,000 of the wagons will remain suitable for transportation. To service export grain flow of 22.4 million tons per annum (this volume was exported in 2008/2009 grain year), over RUR 10 billion (in 2009 prices) is to be invested into purchase and repair of wagons for grain transportation in Russia till 2015.

RZD continues to carry out Trans-Korean Railway reconstruction project
This year OAO RZD continued to integrate into the international transport system actively and to strengthen its role on the international market.
In particular, the company studies several projects concerning Asian and Pacific region, including reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin.
This year OAO RZD and its subsidiaries continued to carry out the pilot project of reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin. In H1 of 2009, the company received from the authorities of North Korea all the necessary permissions; project documentation and the preparation for organizing the construction were completed; the issue of financing the construction works is being studied.
Russian Railways is interested in cooperation with other Asian countries neighbouring the RF. On February 25, Vladimir Yakunin, President of Russian Railways, held working talks in Beijing with Liu Zhijun, the Chinese Minister of Railways.
During the meeting, the sides discussed cooperation between Chinese and Russian railways in the current global financial and economic crisis and emphasised the importance of closer cooperation by increasing rail container traffic between China-Southeast Asia and Russia-Europe. 

Ukrzaliznytsya and OAO RZD: New Project	
The State Administration of Ukrainian Railway Transport (Ukrzaliznytsya) and OAO RZD are studying the project of launching a new route for contrailer transportation from Hungary to Russia. The project was initiated by Hungarian party.
Last April, a Hungarian enterprise Tekiz Zrt offered the top-management of Ukrzaliznytsya to launch a contrainler route to Russia via Ukraine. Destination points are Moscow and Saint Petersburg. The periodicity of transportation is 4 times per month. 
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    [DETAIL_TEXT] => 
Oversized Cargo Transportation: Few Will Survive 
The total revenue of Russian transport and logistic companies working in oversized cargo transportation sector may amount to USD 250-300 million in 2009, consider analysts from InfraNews research agency. To remind, last year the figure was USD 1 billion.
Nowadays, there are plenty of transport and forwarding companies specialising in oversized and heavy cargoes transportation on the market, and the competition between them is tough. “Now the transport companies get profit and speak about their success, but in the near future the level of competition will increase significantly, and a few market participants will manage to survive. Perhaps, the crisis will destroy some links in the delivery chains, which will allow cargo owners to save money,” write authors of “Research of Oversized Cargo Transportation in Russia in 2008-2009”.
The main consumers of oversized cargo transportation services are enterprises operating in metallurgy, construction, machine-building, energy and petrochemistry sectors. The basic export and import routes for oversized freight transportation cross the ports of St. Petersburg, Nakhodka, and Novorossiysk.

Russia to increase grain export volume
Russia continues growing grain export volumes. In July 2009, the growth index totaled 60%, declared the media-department of CJSC Rusagrotrans. 
According to the analytical centre of Rusagrotrans, in July 2009, the general volume of export grain supplies totaled nearly 1.3 mln tonnes, an increase of 1.6 times compared to indices of the same period last grain year. Rather high carry-over stocks of grains of 2008-2009 harvest became the reason for such growth. In August, grain export volumes from Russia are forecasted at the level of 1.8 mln tonnes. According to preliminary data, in July 2009, railway lines of Russia exported nearly 0.5 mln tonnes of grains, up 25% compared to indices of July 2008. 
In 2009/10, export grain supplies will probably decrease. The reduction is caused by the decrease of the world trading with wheat by nearly 16 mln tonnes (12%) compared to the previous grain year due to high harvests in several countries-importers. Also, in the current year, grain harvest in Russia will not exceed the level of 93 mln tonnes as opposed to 108.1 mln tonnes last season. 
Taking into account rather competitive prices for Russian grains, Rusagrotrans forecasts that in the year Russia will stay at the group of three world leaders of wheat exports with average export volumes of nearly 16 mln tonnes (2008/09 - 18.2 mln tonnes), commented Igor Pavanskiy, the head of the Analytical centre of CJSC “Rusagrotrans”.
Thus, Rusagrotrans is going to invest approximately RUR 8 billion into its wagon park modernisation until 2015. The company plans to purchase new railcars as well as to repair the existing ones. These measures will allow to compensate for the shortage of wagons for grain transportation. Nowadays, there are over 32,500 such wagons in Russia, and only 26,000 of them are used to transport grain. By 2015, just 6,000 of the wagons will remain suitable for transportation. To service export grain flow of 22.4 million tons per annum (this volume was exported in 2008/2009 grain year), over RUR 10 billion (in 2009 prices) is to be invested into purchase and repair of wagons for grain transportation in Russia till 2015.

RZD continues to carry out Trans-Korean Railway reconstruction project
This year OAO RZD continued to integrate into the international transport system actively and to strengthen its role on the international market.
In particular, the company studies several projects concerning Asian and Pacific region, including reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin.
This year OAO RZD and its subsidiaries continued to carry out the pilot project of reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin. In H1 of 2009, the company received from the authorities of North Korea all the necessary permissions; project documentation and the preparation for organizing the construction were completed; the issue of financing the construction works is being studied.
Russian Railways is interested in cooperation with other Asian countries neighbouring the RF. On February 25, Vladimir Yakunin, President of Russian Railways, held working talks in Beijing with Liu Zhijun, the Chinese Minister of Railways.
During the meeting, the sides discussed cooperation between Chinese and Russian railways in the current global financial and economic crisis and emphasised the importance of closer cooperation by increasing rail container traffic between China-Southeast Asia and Russia-Europe. 

Ukrzaliznytsya and OAO RZD: New Project	
The State Administration of Ukrainian Railway Transport (Ukrzaliznytsya) and OAO RZD are studying the project of launching a new route for contrailer transportation from Hungary to Russia. The project was initiated by Hungarian party.
Last April, a Hungarian enterprise Tekiz Zrt offered the top-management of Ukrzaliznytsya to launch a contrainler route to Russia via Ukraine. Destination points are Moscow and Saint Petersburg. The periodicity of transportation is 4 times per month. 
    [~DETAIL_TEXT] => 
Oversized Cargo Transportation: Few Will Survive 
The total revenue of Russian transport and logistic companies working in oversized cargo transportation sector may amount to USD 250-300 million in 2009, consider analysts from InfraNews research agency. To remind, last year the figure was USD 1 billion.
Nowadays, there are plenty of transport and forwarding companies specialising in oversized and heavy cargoes transportation on the market, and the competition between them is tough. “Now the transport companies get profit and speak about their success, but in the near future the level of competition will increase significantly, and a few market participants will manage to survive. Perhaps, the crisis will destroy some links in the delivery chains, which will allow cargo owners to save money,” write authors of “Research of Oversized Cargo Transportation in Russia in 2008-2009”.
The main consumers of oversized cargo transportation services are enterprises operating in metallurgy, construction, machine-building, energy and petrochemistry sectors. The basic export and import routes for oversized freight transportation cross the ports of St. Petersburg, Nakhodka, and Novorossiysk.

Russia to increase grain export volume
Russia continues growing grain export volumes. In July 2009, the growth index totaled 60%, declared the media-department of CJSC Rusagrotrans. 
According to the analytical centre of Rusagrotrans, in July 2009, the general volume of export grain supplies totaled nearly 1.3 mln tonnes, an increase of 1.6 times compared to indices of the same period last grain year. Rather high carry-over stocks of grains of 2008-2009 harvest became the reason for such growth. In August, grain export volumes from Russia are forecasted at the level of 1.8 mln tonnes. According to preliminary data, in July 2009, railway lines of Russia exported nearly 0.5 mln tonnes of grains, up 25% compared to indices of July 2008. 
In 2009/10, export grain supplies will probably decrease. The reduction is caused by the decrease of the world trading with wheat by nearly 16 mln tonnes (12%) compared to the previous grain year due to high harvests in several countries-importers. Also, in the current year, grain harvest in Russia will not exceed the level of 93 mln tonnes as opposed to 108.1 mln tonnes last season. 
Taking into account rather competitive prices for Russian grains, Rusagrotrans forecasts that in the year Russia will stay at the group of three world leaders of wheat exports with average export volumes of nearly 16 mln tonnes (2008/09 - 18.2 mln tonnes), commented Igor Pavanskiy, the head of the Analytical centre of CJSC “Rusagrotrans”.
Thus, Rusagrotrans is going to invest approximately RUR 8 billion into its wagon park modernisation until 2015. The company plans to purchase new railcars as well as to repair the existing ones. These measures will allow to compensate for the shortage of wagons for grain transportation. Nowadays, there are over 32,500 such wagons in Russia, and only 26,000 of them are used to transport grain. By 2015, just 6,000 of the wagons will remain suitable for transportation. To service export grain flow of 22.4 million tons per annum (this volume was exported in 2008/2009 grain year), over RUR 10 billion (in 2009 prices) is to be invested into purchase and repair of wagons for grain transportation in Russia till 2015.

RZD continues to carry out Trans-Korean Railway reconstruction project
This year OAO RZD continued to integrate into the international transport system actively and to strengthen its role on the international market.
In particular, the company studies several projects concerning Asian and Pacific region, including reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin.
This year OAO RZD and its subsidiaries continued to carry out the pilot project of reconstruction of Trans-Korean Railway on the Khasan-Rajin section and construction of a container terminal in the port of Rajin. In H1 of 2009, the company received from the authorities of North Korea all the necessary permissions; project documentation and the preparation for organizing the construction were completed; the issue of financing the construction works is being studied.
Russian Railways is interested in cooperation with other Asian countries neighbouring the RF. On February 25, Vladimir Yakunin, President of Russian Railways, held working talks in Beijing with Liu Zhijun, the Chinese Minister of Railways.
During the meeting, the sides discussed cooperation between Chinese and Russian railways in the current global financial and economic crisis and emphasised the importance of closer cooperation by increasing rail container traffic between China-Southeast Asia and Russia-Europe. 

Ukrzaliznytsya and OAO RZD: New Project	
The State Administration of Ukrainian Railway Transport (Ukrzaliznytsya) and OAO RZD are studying the project of launching a new route for contrailer transportation from Hungary to Russia. The project was initiated by Hungarian party.
Last April, a Hungarian enterprise Tekiz Zrt offered the top-management of Ukrzaliznytsya to launch a contrainler route to Russia via Ukraine. Destination points are Moscow and Saint Petersburg. The periodicity of transportation is 4 times per month. 
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We made the task more difficult
The crisis made life much harder for operators exactly at the time when they were making good ground. As a result, many private companies had to come back to their original starting lines and were thrown into a struggle for survival. It came as reforms were already in its finishing stages, when just a few significant decisions had to be taken in order to finalise the creation of market conditions, when private rolling stock was already outnumbering the public park, and when the operator community was becoming a real power with its own voice and the ability to influence the situation.  
RZD-Partner’s annual survey “The Rating of Operators” is based on 2008 summary figures. This research has already taken into consideration the influence of the crisis on companies, showing the changes it caused in the number and structure of the private rolling stock.

Concentration grows
Essentially reduced loading volumes have certainly affected the financial situation of those operators who were engaged in transporting certain kinds of cargoes in much larger volumes than the public park. At the same time, it is necessary to note that operators continue to keep clients by giving a quality service and by being more flexible in their marketing and price policies. According to the statistics, OAO RZD and its affiliated companies have lost much more in the first quarter of this year. Their transport figures shrank by 38.6% when private companies’ reductions were only 11.6%. As a result, the share of private companies in the market grew by almost 50% (48.3%; it was 39.2% before), and RZD’s share shrank to 48.6% (and if we subtract RZD’s affiliated companies’ figures from this amount; it becomes only 31.7%).
Statistics show that the current fall is starting to slow down a little. However, among the cargo items suffering the most there are still building cargoes, including cement, coke and coal, scrap metal, ores of coloured and ferrous metals, mineral fertilisers and wood cargoes. Grain is practically the only cargo which is transported in larger quantities now than before, which is explained by the record breaking harvest last year. Oil and oil products are still holding their former positions. The most difficult situation is at those companies which had taken out credit or who were leasing their rolling stock. We remind readers that last year leasing companies were the owners of not less than 133,000 wagons of various types. Some private enterprises which had a stronger financial platform (for example, Transoil) used to declare last year that the crisis was quite a good time to fill up their wagon fleet. 
When speaking about the process of redistribution of market positions in terms of types of cargoes, it is obvious that the position will become stronger only for those companies which are engaged in the movement of oil, oil products and, probably, gas, because the demand for hydrocarbons is still high. Operators working with containers should expect a strong fall in their rating. It is known that a considerable share of cargoes transported by container belongs to assembled machines and ready-made cars. Meanwhile the demand for cars fell both stronger and quicker than in other sectors, because these goods are just in the category which the population tried to save money on first of all. Also, containers used to carry a considerable part of commodities whilst sales in this sector have also fallen seriously both in Russia and other CIS countries. Uneasy times are also ahead without a doubt for those operators which serve the logistical needs of large holding groups in the metallurgical and coal industries. 

Luck comes to those who takes risks
So this year experts predict a considerable redistribution of rolling stock amongst the wagon owners, which means their concentration and absorption by larger companies. This will facilitate the tendency for consolidation, which was seen much earlier in this sector much earlier. However, the President of the Association of Carriers and Rolling Stock Operators (ASKOP), Vladimir Prokofiev, says that, formally, this process occurs, more likely, by virtue of the concentration of wagons with their original proprietors - leasing companies and banks. He thinks that if we want to understand whether this tendency will also reduce the number of rolling stock owners, we must wait at least until the end of the half-year.
Experts have estimated that the greater part of the 250,000 units of proficient rolling stock currently idling unloaded on the tracks, are gondola wagons, mineral wagons, iron ore wagons, covered wagons and flat wagons. There are practically no unused tankers. General Director of INFOLine-Analitika, Mikhail Burmistrov said that many transport agencies used to lease this type of wagon before, but now because the economic efficiency of their own transport is growing, they have started to refuse to use other companies. Therefore Russian and Kazakh companies which need tankers have to search for other leasing companies, including those in Ukraine and Estonia.
As regards grain wagons, there is a real lack of them. From 2004 to 2008 Russian private companies and RZD purchased wagons of this type in very small quantities, because they had too much rolling stock of this type available. But the increase in grain harvest brought growth to Russian grain exports which created the situation in 2008 where the seasonal lack of grain wagons was 2,000 units, and where in 2009 this figure may grow to almost 9,000.
However, market conditions may change quite quickly. Apparently, those owners of specialised (and not only specialised) rolling stock who are not burdened by credits, do not aspire to get rid of their wagons yet, hoping for favourable changes. As a matter of fact, this is clearly shown in the ratings: on 2008 results, practically all companies questioned by us increased the number of wagons in ownership in comparison with 2007. First place (by growth of rolling stock among private companies) was taken by Globaltrans which acquired about 6,000 wagons (some of them bought and some of them were acquired on condition of financial leasing), thus increasing its park to 23.600 wagons. 
It is good to note that whilst an increase in the transport of ferrous metals by private companies does not surprise anyone anymore (because this tendency has continued for the last few years), the growth in the amount of coal transported by independent market participants is really a new phenomenon. The share of private operators in this sector, on results of the last quarter, is 43% against a former share of 30.1%. Generally speaking, looking at changes taking place later to the operators’ wagon fleet it is obvious that it is too early to speak about too many big changes caused by the crisis, because the large players have not had enough time yet to fill up their parks with large numbers of wagons, notwithstanding the fact that the losses of small operators are large enough. Most likely, we shall be able to dot all our “i”s and cross all our “t”s at the end of year, when it becomes clear by how much the number of wagon owners has shrunk, and how many new wagons have been added to the parks of the largest operators. So far this tendency is as follows: in September 2008 about 3,000 companies were offering their wagons for transportation, and in just a few months this figure has already reduced to 2,200. 
Nadezhda Vtorushina 

WHAT WE CALCULATED AND HOW WE DID IT
Each self-respecting sector of the economy has its own rating. A year ago our magazine also found it necessary to create a rating for the Best Railway Operators in Russia. The feedback we received from our audience shows that the demand for such a project (which has already become an annual event) is quite large.
 The Rating was created in cooperation with INFOLine IA and it is based on figures received from the companies themselves and from rolling stock owners. If the received information seemed disputable, negotiations with such companies followed, after which the disputable data was either corrected or not published at all. A number of operators only provided partial information, meaning that not all the required figures for a rating were given. Therefore the Final Rating, which summarized all parameters, evaluated them only in some of its sectors; which without doubt did not allow such companies to win places they would deserve to win otherwise. Probably, some companies refused to disclose their figures in this crisis situation because they did not want to show downward trends, or maybe because the competitive struggle in the market has became more severe.  

Methods of Rating creation 
The following parameters were applied in order to rate operators:
- Number of freight wagons in ownership (with wagon types specified);
- Number of freight wagons in operation;
- Cargo transportation volume;
- Income from the transport of cargo by rail (here Income was the difference between the revenue from operator activity and RZD’s tariff for using its infrastructure and locomotives).
The general operator rating picture was created using a system of ranks, which defined the place of each company among all other rating participants with consideration of the criteria listed above and based on each company’s figures for 2008. The final result for each company in the Rating depended on the sum of its ranks: the smaller the sum of the ranks, the higher the final place. If final figures were shared by two or more companies, then higher place was given to those companies who had disclosed more data. All ratings, with the exception of the final one, are quantitative, so each company’s final place in these ratings depends on the size of its figure in the respective parameter. Those companies which did not provide figures have not been included in the final rating. In the rating of companies by financial criteria, only results for companies which had disclosed income information during our questioning were taken into consideration.
    [~DETAIL_TEXT] => 
We made the task more difficult
The crisis made life much harder for operators exactly at the time when they were making good ground. As a result, many private companies had to come back to their original starting lines and were thrown into a struggle for survival. It came as reforms were already in its finishing stages, when just a few significant decisions had to be taken in order to finalise the creation of market conditions, when private rolling stock was already outnumbering the public park, and when the operator community was becoming a real power with its own voice and the ability to influence the situation.  
RZD-Partner’s annual survey “The Rating of Operators” is based on 2008 summary figures. This research has already taken into consideration the influence of the crisis on companies, showing the changes it caused in the number and structure of the private rolling stock.

Concentration grows
Essentially reduced loading volumes have certainly affected the financial situation of those operators who were engaged in transporting certain kinds of cargoes in much larger volumes than the public park. At the same time, it is necessary to note that operators continue to keep clients by giving a quality service and by being more flexible in their marketing and price policies. According to the statistics, OAO RZD and its affiliated companies have lost much more in the first quarter of this year. Their transport figures shrank by 38.6% when private companies’ reductions were only 11.6%. As a result, the share of private companies in the market grew by almost 50% (48.3%; it was 39.2% before), and RZD’s share shrank to 48.6% (and if we subtract RZD’s affiliated companies’ figures from this amount; it becomes only 31.7%).
Statistics show that the current fall is starting to slow down a little. However, among the cargo items suffering the most there are still building cargoes, including cement, coke and coal, scrap metal, ores of coloured and ferrous metals, mineral fertilisers and wood cargoes. Grain is practically the only cargo which is transported in larger quantities now than before, which is explained by the record breaking harvest last year. Oil and oil products are still holding their former positions. The most difficult situation is at those companies which had taken out credit or who were leasing their rolling stock. We remind readers that last year leasing companies were the owners of not less than 133,000 wagons of various types. Some private enterprises which had a stronger financial platform (for example, Transoil) used to declare last year that the crisis was quite a good time to fill up their wagon fleet. 
When speaking about the process of redistribution of market positions in terms of types of cargoes, it is obvious that the position will become stronger only for those companies which are engaged in the movement of oil, oil products and, probably, gas, because the demand for hydrocarbons is still high. Operators working with containers should expect a strong fall in their rating. It is known that a considerable share of cargoes transported by container belongs to assembled machines and ready-made cars. Meanwhile the demand for cars fell both stronger and quicker than in other sectors, because these goods are just in the category which the population tried to save money on first of all. Also, containers used to carry a considerable part of commodities whilst sales in this sector have also fallen seriously both in Russia and other CIS countries. Uneasy times are also ahead without a doubt for those operators which serve the logistical needs of large holding groups in the metallurgical and coal industries. 

Luck comes to those who takes risks
So this year experts predict a considerable redistribution of rolling stock amongst the wagon owners, which means their concentration and absorption by larger companies. This will facilitate the tendency for consolidation, which was seen much earlier in this sector much earlier. However, the President of the Association of Carriers and Rolling Stock Operators (ASKOP), Vladimir Prokofiev, says that, formally, this process occurs, more likely, by virtue of the concentration of wagons with their original proprietors - leasing companies and banks. He thinks that if we want to understand whether this tendency will also reduce the number of rolling stock owners, we must wait at least until the end of the half-year.
Experts have estimated that the greater part of the 250,000 units of proficient rolling stock currently idling unloaded on the tracks, are gondola wagons, mineral wagons, iron ore wagons, covered wagons and flat wagons. There are practically no unused tankers. General Director of INFOLine-Analitika, Mikhail Burmistrov said that many transport agencies used to lease this type of wagon before, but now because the economic efficiency of their own transport is growing, they have started to refuse to use other companies. Therefore Russian and Kazakh companies which need tankers have to search for other leasing companies, including those in Ukraine and Estonia.
As regards grain wagons, there is a real lack of them. From 2004 to 2008 Russian private companies and RZD purchased wagons of this type in very small quantities, because they had too much rolling stock of this type available. But the increase in grain harvest brought growth to Russian grain exports which created the situation in 2008 where the seasonal lack of grain wagons was 2,000 units, and where in 2009 this figure may grow to almost 9,000.
However, market conditions may change quite quickly. Apparently, those owners of specialised (and not only specialised) rolling stock who are not burdened by credits, do not aspire to get rid of their wagons yet, hoping for favourable changes. As a matter of fact, this is clearly shown in the ratings: on 2008 results, practically all companies questioned by us increased the number of wagons in ownership in comparison with 2007. First place (by growth of rolling stock among private companies) was taken by Globaltrans which acquired about 6,000 wagons (some of them bought and some of them were acquired on condition of financial leasing), thus increasing its park to 23.600 wagons. 
It is good to note that whilst an increase in the transport of ferrous metals by private companies does not surprise anyone anymore (because this tendency has continued for the last few years), the growth in the amount of coal transported by independent market participants is really a new phenomenon. The share of private operators in this sector, on results of the last quarter, is 43% against a former share of 30.1%. Generally speaking, looking at changes taking place later to the operators’ wagon fleet it is obvious that it is too early to speak about too many big changes caused by the crisis, because the large players have not had enough time yet to fill up their parks with large numbers of wagons, notwithstanding the fact that the losses of small operators are large enough. Most likely, we shall be able to dot all our “i”s and cross all our “t”s at the end of year, when it becomes clear by how much the number of wagon owners has shrunk, and how many new wagons have been added to the parks of the largest operators. So far this tendency is as follows: in September 2008 about 3,000 companies were offering their wagons for transportation, and in just a few months this figure has already reduced to 2,200. 
Nadezhda Vtorushina 

WHAT WE CALCULATED AND HOW WE DID IT
Each self-respecting sector of the economy has its own rating. A year ago our magazine also found it necessary to create a rating for the Best Railway Operators in Russia. The feedback we received from our audience shows that the demand for such a project (which has already become an annual event) is quite large.
 The Rating was created in cooperation with INFOLine IA and it is based on figures received from the companies themselves and from rolling stock owners. If the received information seemed disputable, negotiations with such companies followed, after which the disputable data was either corrected or not published at all. A number of operators only provided partial information, meaning that not all the required figures for a rating were given. Therefore the Final Rating, which summarized all parameters, evaluated them only in some of its sectors; which without doubt did not allow such companies to win places they would deserve to win otherwise. Probably, some companies refused to disclose their figures in this crisis situation because they did not want to show downward trends, or maybe because the competitive struggle in the market has became more severe.  

Methods of Rating creation 
The following parameters were applied in order to rate operators:
- Number of freight wagons in ownership (with wagon types specified);
- Number of freight wagons in operation;
- Cargo transportation volume;
- Income from the transport of cargo by rail (here Income was the difference between the revenue from operator activity and RZD’s tariff for using its infrastructure and locomotives).
The general operator rating picture was created using a system of ranks, which defined the place of each company among all other rating participants with consideration of the criteria listed above and based on each company’s figures for 2008. The final result for each company in the Rating depended on the sum of its ranks: the smaller the sum of the ranks, the higher the final place. If final figures were shared by two or more companies, then higher place was given to those companies who had disclosed more data. All ratings, with the exception of the final one, are quantitative, so each company’s final place in these ratings depends on the size of its figure in the respective parameter. Those companies which did not provide figures have not been included in the final rating. In the rating of companies by financial criteria, only results for companies which had disclosed income information during our questioning were taken into consideration.
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We made the task more difficult
The crisis made life much harder for operators exactly at the time when they were making good ground. As a result, many private companies had to come back to their original starting lines and were thrown into a struggle for survival. It came as reforms were already in its finishing stages, when just a few significant decisions had to be taken in order to finalise the creation of market conditions, when private rolling stock was already outnumbering the public park, and when the operator community was becoming a real power with its own voice and the ability to influence the situation.  
RZD-Partner’s annual survey “The Rating of Operators” is based on 2008 summary figures. This research has already taken into consideration the influence of the crisis on companies, showing the changes it caused in the number and structure of the private rolling stock.

Concentration grows
Essentially reduced loading volumes have certainly affected the financial situation of those operators who were engaged in transporting certain kinds of cargoes in much larger volumes than the public park. At the same time, it is necessary to note that operators continue to keep clients by giving a quality service and by being more flexible in their marketing and price policies. According to the statistics, OAO RZD and its affiliated companies have lost much more in the first quarter of this year. Their transport figures shrank by 38.6% when private companies’ reductions were only 11.6%. As a result, the share of private companies in the market grew by almost 50% (48.3%; it was 39.2% before), and RZD’s share shrank to 48.6% (and if we subtract RZD’s affiliated companies’ figures from this amount; it becomes only 31.7%).
Statistics show that the current fall is starting to slow down a little. However, among the cargo items suffering the most there are still building cargoes, including cement, coke and coal, scrap metal, ores of coloured and ferrous metals, mineral fertilisers and wood cargoes. Grain is practically the only cargo which is transported in larger quantities now than before, which is explained by the record breaking harvest last year. Oil and oil products are still holding their former positions. The most difficult situation is at those companies which had taken out credit or who were leasing their rolling stock. We remind readers that last year leasing companies were the owners of not less than 133,000 wagons of various types. Some private enterprises which had a stronger financial platform (for example, Transoil) used to declare last year that the crisis was quite a good time to fill up their wagon fleet. 
When speaking about the process of redistribution of market positions in terms of types of cargoes, it is obvious that the position will become stronger only for those companies which are engaged in the movement of oil, oil products and, probably, gas, because the demand for hydrocarbons is still high. Operators working with containers should expect a strong fall in their rating. It is known that a considerable share of cargoes transported by container belongs to assembled machines and ready-made cars. Meanwhile the demand for cars fell both stronger and quicker than in other sectors, because these goods are just in the category which the population tried to save money on first of all. Also, containers used to carry a considerable part of commodities whilst sales in this sector have also fallen seriously both in Russia and other CIS countries. Uneasy times are also ahead without a doubt for those operators which serve the logistical needs of large holding groups in the metallurgical and coal industries. 

Luck comes to those who takes risks
So this year experts predict a considerable redistribution of rolling stock amongst the wagon owners, which means their concentration and absorption by larger companies. This will facilitate the tendency for consolidation, which was seen much earlier in this sector much earlier. However, the President of the Association of Carriers and Rolling Stock Operators (ASKOP), Vladimir Prokofiev, says that, formally, this process occurs, more likely, by virtue of the concentration of wagons with their original proprietors - leasing companies and banks. He thinks that if we want to understand whether this tendency will also reduce the number of rolling stock owners, we must wait at least until the end of the half-year.
Experts have estimated that the greater part of the 250,000 units of proficient rolling stock currently idling unloaded on the tracks, are gondola wagons, mineral wagons, iron ore wagons, covered wagons and flat wagons. There are practically no unused tankers. General Director of INFOLine-Analitika, Mikhail Burmistrov said that many transport agencies used to lease this type of wagon before, but now because the economic efficiency of their own transport is growing, they have started to refuse to use other companies. Therefore Russian and Kazakh companies which need tankers have to search for other leasing companies, including those in Ukraine and Estonia.
As regards grain wagons, there is a real lack of them. From 2004 to 2008 Russian private companies and RZD purchased wagons of this type in very small quantities, because they had too much rolling stock of this type available. But the increase in grain harvest brought growth to Russian grain exports which created the situation in 2008 where the seasonal lack of grain wagons was 2,000 units, and where in 2009 this figure may grow to almost 9,000.
However, market conditions may change quite quickly. Apparently, those owners of specialised (and not only specialised) rolling stock who are not burdened by credits, do not aspire to get rid of their wagons yet, hoping for favourable changes. As a matter of fact, this is clearly shown in the ratings: on 2008 results, practically all companies questioned by us increased the number of wagons in ownership in comparison with 2007. First place (by growth of rolling stock among private companies) was taken by Globaltrans which acquired about 6,000 wagons (some of them bought and some of them were acquired on condition of financial leasing), thus increasing its park to 23.600 wagons. 
It is good to note that whilst an increase in the transport of ferrous metals by private companies does not surprise anyone anymore (because this tendency has continued for the last few years), the growth in the amount of coal transported by independent market participants is really a new phenomenon. The share of private operators in this sector, on results of the last quarter, is 43% against a former share of 30.1%. Generally speaking, looking at changes taking place later to the operators’ wagon fleet it is obvious that it is too early to speak about too many big changes caused by the crisis, because the large players have not had enough time yet to fill up their parks with large numbers of wagons, notwithstanding the fact that the losses of small operators are large enough. Most likely, we shall be able to dot all our “i”s and cross all our “t”s at the end of year, when it becomes clear by how much the number of wagon owners has shrunk, and how many new wagons have been added to the parks of the largest operators. So far this tendency is as follows: in September 2008 about 3,000 companies were offering their wagons for transportation, and in just a few months this figure has already reduced to 2,200. 
Nadezhda Vtorushina 

WHAT WE CALCULATED AND HOW WE DID IT
Each self-respecting sector of the economy has its own rating. A year ago our magazine also found it necessary to create a rating for the Best Railway Operators in Russia. The feedback we received from our audience shows that the demand for such a project (which has already become an annual event) is quite large.
 The Rating was created in cooperation with INFOLine IA and it is based on figures received from the companies themselves and from rolling stock owners. If the received information seemed disputable, negotiations with such companies followed, after which the disputable data was either corrected or not published at all. A number of operators only provided partial information, meaning that not all the required figures for a rating were given. Therefore the Final Rating, which summarized all parameters, evaluated them only in some of its sectors; which without doubt did not allow such companies to win places they would deserve to win otherwise. Probably, some companies refused to disclose their figures in this crisis situation because they did not want to show downward trends, or maybe because the competitive struggle in the market has became more severe.  

Methods of Rating creation 
The following parameters were applied in order to rate operators:
- Number of freight wagons in ownership (with wagon types specified);
- Number of freight wagons in operation;
- Cargo transportation volume;
- Income from the transport of cargo by rail (here Income was the difference between the revenue from operator activity and RZD’s tariff for using its infrastructure and locomotives).
The general operator rating picture was created using a system of ranks, which defined the place of each company among all other rating participants with consideration of the criteria listed above and based on each company’s figures for 2008. The final result for each company in the Rating depended on the sum of its ranks: the smaller the sum of the ranks, the higher the final place. If final figures were shared by two or more companies, then higher place was given to those companies who had disclosed more data. All ratings, with the exception of the final one, are quantitative, so each company’s final place in these ratings depends on the size of its figure in the respective parameter. Those companies which did not provide figures have not been included in the final rating. In the rating of companies by financial criteria, only results for companies which had disclosed income information during our questioning were taken into consideration.
    [~DETAIL_TEXT] => 
We made the task more difficult
The crisis made life much harder for operators exactly at the time when they were making good ground. As a result, many private companies had to come back to their original starting lines and were thrown into a struggle for survival. It came as reforms were already in its finishing stages, when just a few significant decisions had to be taken in order to finalise the creation of market conditions, when private rolling stock was already outnumbering the public park, and when the operator community was becoming a real power with its own voice and the ability to influence the situation.  
RZD-Partner’s annual survey “The Rating of Operators” is based on 2008 summary figures. This research has already taken into consideration the influence of the crisis on companies, showing the changes it caused in the number and structure of the private rolling stock.

Concentration grows
Essentially reduced loading volumes have certainly affected the financial situation of those operators who were engaged in transporting certain kinds of cargoes in much larger volumes than the public park. At the same time, it is necessary to note that operators continue to keep clients by giving a quality service and by being more flexible in their marketing and price policies. According to the statistics, OAO RZD and its affiliated companies have lost much more in the first quarter of this year. Their transport figures shrank by 38.6% when private companies’ reductions were only 11.6%. As a result, the share of private companies in the market grew by almost 50% (48.3%; it was 39.2% before), and RZD’s share shrank to 48.6% (and if we subtract RZD’s affiliated companies’ figures from this amount; it becomes only 31.7%).
Statistics show that the current fall is starting to slow down a little. However, among the cargo items suffering the most there are still building cargoes, including cement, coke and coal, scrap metal, ores of coloured and ferrous metals, mineral fertilisers and wood cargoes. Grain is practically the only cargo which is transported in larger quantities now than before, which is explained by the record breaking harvest last year. Oil and oil products are still holding their former positions. The most difficult situation is at those companies which had taken out credit or who were leasing their rolling stock. We remind readers that last year leasing companies were the owners of not less than 133,000 wagons of various types. Some private enterprises which had a stronger financial platform (for example, Transoil) used to declare last year that the crisis was quite a good time to fill up their wagon fleet. 
When speaking about the process of redistribution of market positions in terms of types of cargoes, it is obvious that the position will become stronger only for those companies which are engaged in the movement of oil, oil products and, probably, gas, because the demand for hydrocarbons is still high. Operators working with containers should expect a strong fall in their rating. It is known that a considerable share of cargoes transported by container belongs to assembled machines and ready-made cars. Meanwhile the demand for cars fell both stronger and quicker than in other sectors, because these goods are just in the category which the population tried to save money on first of all. Also, containers used to carry a considerable part of commodities whilst sales in this sector have also fallen seriously both in Russia and other CIS countries. Uneasy times are also ahead without a doubt for those operators which serve the logistical needs of large holding groups in the metallurgical and coal industries. 

Luck comes to those who takes risks
So this year experts predict a considerable redistribution of rolling stock amongst the wagon owners, which means their concentration and absorption by larger companies. This will facilitate the tendency for consolidation, which was seen much earlier in this sector much earlier. However, the President of the Association of Carriers and Rolling Stock Operators (ASKOP), Vladimir Prokofiev, says that, formally, this process occurs, more likely, by virtue of the concentration of wagons with their original proprietors - leasing companies and banks. He thinks that if we want to understand whether this tendency will also reduce the number of rolling stock owners, we must wait at least until the end of the half-year.
Experts have estimated that the greater part of the 250,000 units of proficient rolling stock currently idling unloaded on the tracks, are gondola wagons, mineral wagons, iron ore wagons, covered wagons and flat wagons. There are practically no unused tankers. General Director of INFOLine-Analitika, Mikhail Burmistrov said that many transport agencies used to lease this type of wagon before, but now because the economic efficiency of their own transport is growing, they have started to refuse to use other companies. Therefore Russian and Kazakh companies which need tankers have to search for other leasing companies, including those in Ukraine and Estonia.
As regards grain wagons, there is a real lack of them. From 2004 to 2008 Russian private companies and RZD purchased wagons of this type in very small quantities, because they had too much rolling stock of this type available. But the increase in grain harvest brought growth to Russian grain exports which created the situation in 2008 where the seasonal lack of grain wagons was 2,000 units, and where in 2009 this figure may grow to almost 9,000.
However, market conditions may change quite quickly. Apparently, those owners of specialised (and not only specialised) rolling stock who are not burdened by credits, do not aspire to get rid of their wagons yet, hoping for favourable changes. As a matter of fact, this is clearly shown in the ratings: on 2008 results, practically all companies questioned by us increased the number of wagons in ownership in comparison with 2007. First place (by growth of rolling stock among private companies) was taken by Globaltrans which acquired about 6,000 wagons (some of them bought and some of them were acquired on condition of financial leasing), thus increasing its park to 23.600 wagons. 
It is good to note that whilst an increase in the transport of ferrous metals by private companies does not surprise anyone anymore (because this tendency has continued for the last few years), the growth in the amount of coal transported by independent market participants is really a new phenomenon. The share of private operators in this sector, on results of the last quarter, is 43% against a former share of 30.1%. Generally speaking, looking at changes taking place later to the operators’ wagon fleet it is obvious that it is too early to speak about too many big changes caused by the crisis, because the large players have not had enough time yet to fill up their parks with large numbers of wagons, notwithstanding the fact that the losses of small operators are large enough. Most likely, we shall be able to dot all our “i”s and cross all our “t”s at the end of year, when it becomes clear by how much the number of wagon owners has shrunk, and how many new wagons have been added to the parks of the largest operators. So far this tendency is as follows: in September 2008 about 3,000 companies were offering their wagons for transportation, and in just a few months this figure has already reduced to 2,200. 
Nadezhda Vtorushina 

WHAT WE CALCULATED AND HOW WE DID IT
Each self-respecting sector of the economy has its own rating. A year ago our magazine also found it necessary to create a rating for the Best Railway Operators in Russia. The feedback we received from our audience shows that the demand for such a project (which has already become an annual event) is quite large.
 The Rating was created in cooperation with INFOLine IA and it is based on figures received from the companies themselves and from rolling stock owners. If the received information seemed disputable, negotiations with such companies followed, after which the disputable data was either corrected or not published at all. A number of operators only provided partial information, meaning that not all the required figures for a rating were given. Therefore the Final Rating, which summarized all parameters, evaluated them only in some of its sectors; which without doubt did not allow such companies to win places they would deserve to win otherwise. Probably, some companies refused to disclose their figures in this crisis situation because they did not want to show downward trends, or maybe because the competitive struggle in the market has became more severe.  

Methods of Rating creation 
The following parameters were applied in order to rate operators:
- Number of freight wagons in ownership (with wagon types specified);
- Number of freight wagons in operation;
- Cargo transportation volume;
- Income from the transport of cargo by rail (here Income was the difference between the revenue from operator activity and RZD’s tariff for using its infrastructure and locomotives).
The general operator rating picture was created using a system of ranks, which defined the place of each company among all other rating participants with consideration of the criteria listed above and based on each company’s figures for 2008. The final result for each company in the Rating depended on the sum of its ranks: the smaller the sum of the ranks, the higher the final place. If final figures were shared by two or more companies, then higher place was given to those companies who had disclosed more data. All ratings, with the exception of the final one, are quantitative, so each company’s final place in these ratings depends on the size of its figure in the respective parameter. Those companies which did not provide figures have not been included in the final rating. In the rating of companies by financial criteria, only results for companies which had disclosed income information during our questioning were taken into consideration.
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• on the basis of Federal Acts, Resolutions and Decrees of the President of the Russian Federation and the Government of the Russian Federation, and in accordance with the procedures provided for therein, it exercises the following powers for control and supervision concerning relevant activities: collection of customs duties, taxes, anti-dumping, countervailing and special duties, preliminary anti-dumping, preliminary special and preliminary countervailing duties, customs duties; it also supervises accuracy of assessment and timeliness of payment of the specified duties, taxes and charges, and takes measures for enforcement and compulsory collection or return thereof; ensure observance of the restrictions and limitations imposed in accordance with the legislation of the Russian Federation on Government regulation of foreign trade activities, and in accordance with international treaties ratified by the Russian Federation, concerning goods being moved across the customs border of the Russian Federation; ensure and maintain uniform application by customs authorities of the customs legislation of the Russian Federation etc.
The Federal Customs Service is headed by Andrey Belyaninov.
The Federal Customs Service consists of the central office, responsible for overall management and coordination, and regional departments to which customs duties are subordinated. Also, there are special customs: Central Excise Customs, Central Basic Customs, Central Customs (Dog Training Centre at the RF Federal Customs Service), and Central Power Customs (provides customs procedures and customs control for energy carriers transported via the border of the Russian Federation, as well as for vessels used for merchant shipping and goods carried by them via the RF customs border).
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    [DETAIL_TEXT] => The Federal Customs Service is managed and directed by the Government of the Russian Federation.
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• on the basis of Federal Acts, Resolutions and Decrees of the President of the Russian Federation and the Government of the Russian Federation, and in accordance with the procedures provided for therein, it exercises the following powers for control and supervision concerning relevant activities: collection of customs duties, taxes, anti-dumping, countervailing and special duties, preliminary anti-dumping, preliminary special and preliminary countervailing duties, customs duties; it also supervises accuracy of assessment and timeliness of payment of the specified duties, taxes and charges, and takes measures for enforcement and compulsory collection or return thereof; ensure observance of the restrictions and limitations imposed in accordance with the legislation of the Russian Federation on Government regulation of foreign trade activities, and in accordance with international treaties ratified by the Russian Federation, concerning goods being moved across the customs border of the Russian Federation; ensure and maintain uniform application by customs authorities of the customs legislation of the Russian Federation etc.
The Federal Customs Service is headed by Andrey Belyaninov.
The Federal Customs Service consists of the central office, responsible for overall management and coordination, and regional departments to which customs duties are subordinated. Also, there are special customs: Central Excise Customs, Central Basic Customs, Central Customs (Dog Training Centre at the RF Federal Customs Service), and Central Power Customs (provides customs procedures and customs control for energy carriers transported via the border of the Russian Federation, as well as for vessels used for merchant shipping and goods carried by them via the RF customs border).
Another three customs departments, subordinated to the central office of the Federal Customs Service, operate in the largest Russian airports –Vnukovo, Domodedovo, and Sheremetyevo.
    [~DETAIL_TEXT] => The Federal Customs Service is managed and directed by the Government of the Russian Federation.
Powers of the Federal Customs Service:
• based on, and in pursuance of, the Constitution of the Russian Federation, federal constitutional laws, federal laws, resolutions by the President of the Russian Federation and the Government of the Russian Federation, it approves the following regulatory instruments in the specified area of activity: procedure for keeping registers of entities authorised to carry out customs-related activities; procedure for keeping a register of banks, other credit establishments and insurance companies, which provide bank guarantees acceptable by customs authorities as security for payment of customs charges; procedure for keeping register of insurance companies, who provide insurance contracts acceptable by customs authorities as security for payment of customs charges; lists of documents and information, requirements for data necessary for customs clearance applicable to specific customs procedures and customs regimes, and the terms of submitting such documents and information; form and procedure of completing transit declarations; form and the procedure of issuing the certificate authorising the vehicle, container or demountable body to be used for transportation of customs-sealed goods, etc.
• on the basis of Federal Acts, Resolutions and Decrees of the President of the Russian Federation and the Government of the Russian Federation, and in accordance with the procedures provided for therein, it exercises the following powers for control and supervision concerning relevant activities: collection of customs duties, taxes, anti-dumping, countervailing and special duties, preliminary anti-dumping, preliminary special and preliminary countervailing duties, customs duties; it also supervises accuracy of assessment and timeliness of payment of the specified duties, taxes and charges, and takes measures for enforcement and compulsory collection or return thereof; ensure observance of the restrictions and limitations imposed in accordance with the legislation of the Russian Federation on Government regulation of foreign trade activities, and in accordance with international treaties ratified by the Russian Federation, concerning goods being moved across the customs border of the Russian Federation; ensure and maintain uniform application by customs authorities of the customs legislation of the Russian Federation etc.
The Federal Customs Service is headed by Andrey Belyaninov.
The Federal Customs Service consists of the central office, responsible for overall management and coordination, and regional departments to which customs duties are subordinated. Also, there are special customs: Central Excise Customs, Central Basic Customs, Central Customs (Dog Training Centre at the RF Federal Customs Service), and Central Power Customs (provides customs procedures and customs control for energy carriers transported via the border of the Russian Federation, as well as for vessels used for merchant shipping and goods carried by them via the RF customs border).
Another three customs departments, subordinated to the central office of the Federal Customs Service, operate in the largest Russian airports –Vnukovo, Domodedovo, and Sheremetyevo.
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    [PREVIEW_TEXT] => The Federal Customs Service is an authorised federal executive authority, which carries out its duties and functions in accordance with the Law of the Russian Federation with regard to the development of state policy and legal regulations, oversight and control over the customs issues, as well as the functions of currency exchange regulatory agency and special counter-contraband activities and other crimes and administrative violations control.
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    [NAME] => Cargo Turnover in Baltic Countries: disturbing tendencies and optimistic expectations
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The Railway: Change of Leaders  
Railway companies in the Baltics have transported 60.08 million tons of cargo in the first half of this year, which is 13.9% less than for the same period the year before, when 69.8 million tons of cargo was transported. First of all, the reduction can be explained by the economic crisis. But when considering the work of companies, generally speaking, many factors influenced their activity. 
These include the reorientation of cargo flows (over the year almost all potash fertiliser produced in Belarus went from Latvia to Lithuania), a decrease in the movement of seasonal cargoes, tariff negotiations that have gone on for too long over transit movement across Lithuania, because of which Lithuania has lost almost half of its transit cargoes in the Kaliningrad region. The falling figures in Estonia are basically connected to a policy to decrease exports of Russian oil products.   
Latvian LDz Cargo, a branch of Latvijas dzelzcels (LDz), had the largest share of the 60.08 million tons carried over the half-year by Baltic railways. It transported 28.17 million tons (1.2% more than the same period last year). In second place was the Lithuanian company Lietuvos gelezinkeliai with about 19.76 million tons (31.1% less than before). Third place, with about 12.21 million tons was Estonian company Eesti Raudtee (a fall of 8.8%).  
During the first half of the year, Latvians managed to stay leaders, having occupied almost half of the transport market by enlarging their transit cargo flows of coal, oil, oil products and chemicals, mostly of Russian and Belarus origin. Lithuanians had to retreat into second place. As of June of the current year, they have lost about a third of their cargoes, or nearly 33% of the market. Oil and oil product transits fell, as well as fertilisers and mineral products. In third position are the Estonians, and their market share in transits has grown by 20% compared with the same period last year, due to the transit of black oil from Russia and Belarus.

The Leader is LDz Cargo
Successful activity, long-term transit agreements on Russian, Lithuanian, Belarus and Kazakh oil, oil products, coal and mineral fertilisers have allowed the company to be called a leading carrier in the region. During that half-year, the share of Russian cargoes was 69.1% of all cargoes (last year it was 61.2% for the same period), Belarus cargoes 23.8% (25.8% last year), and Lithuanian cargoes (6%).
Good results were achieved because import traffic grew to 24.8 million tons, including through the ports of Latvia, where 11.6% – or 23.3 million tons – more cargo was transported. Simultaneously exports, local cargo flows and overland transit cargoes fell. Exports have fallen by 5.6% to 1.13 million tons, if you compare it with about 1.2 million tons in the first half of last year. 
Internal cargo has fallen by 23% to 602,000 tons and overland transit (basically only oil products) through Latvian territory to Estonia decreased by 40% to 1.5 million tons.  
LDz Cargo has traditionally transported mostly oil and oil products, which is 41% of all cargoes (the previous half year figure was 34.8%), coal was 36.5% of the entire volume (33.1% last year), mineral fertilisers – 5.5% (9.3% in the same half-year period last year).  
Oil and oil products transported reached 11.54 million tons over the first six months, which is 12% more than for the same period last year. 
Traffic in the second largest cargo group, coal and coke, grew by 16.9% and reached 10.31 million tons. Monthly growth is stable, but in spring there was a small percentage recession because of falling energy demand in the world market. Chemical cargo flows grew by 20.2% to 1.45 million tons. 
There was a positive tendency in the container transport market, which grew by 0.2%, to 27.44 million tons as a result of the delivery of motor vehicles to Kazakhstan and non-military cargoes to Afghanistan. Among negative tendencies there was a reduction in grain transit by 26.5% and by 36.1% in mineral fertilisers. The largest falls were in cargoes such as sugar (61.5% down) and timber (60.3% down).

Lietuvos gelezinkeliai. Fall is stabilising
Lithuanian railway company Lietuvos gelezinkeliai transported 19.74 million tons of cargo in the accounting period, which was 31.1% less than for the half-year in 2008. Falls in cargo movements were noticed in all directions and in practically all cargo items, both within the half-year, and on a monthly basis. Experts believe that such falls have taken place not only as a result of the general economic situation, but also because of the tariff “wars”, with Lithuanians losing about half of their cargoes in the direction of the Kaliningrad Region.      
So, internal transport fell by 15.7% to 6.2 million tons because of reduced consumer demand in the republic, imports fell by 32.8% to 5.7 million tons, exports by 31.6% to 1.9 million tons, and transits by 40.6% to 5.86 million tons. The transit cargo sector showed the biggest fall. International transport, including exports, imports and transits, decreased by 36.4% to 13.5 million tons. 
The company’s main cargoes are oil products, fertilisers and mineral products. Over the accounting period, 47.7% of the total cargo flow was oil and oil products (this figure in the previous half-year period was 42%), fertilisers – 19.9% (a year ago this figure was 19.1%), mineral products – 6.12% (9.49% in the previous half-year). For the same accounting period, oil and oil products flows were 9.42 million tons, a reduction of 21.8%, fertilisers fell by 28.3% to 3.98 million tons, and other cargoes were 29.4% down to 2.5 million tons.  
The worst fall was in the transport of the company’s main cargo group – mineral products. Their flows were halved, down to 1.21 million tons. Coal and coke shipments were 48.5% down, to 955,000 tons, ferrous metals by 65% to 703,000 tons. The only cargo group where growth was noticed was phyto-originated products – 992,000 tons, or 8% up.   

Eesti Raudtee: Lots of Black Oil and More Coal 
Estonian enterprise Eesti Raudtee transported 12.21 million tons of cargo; 8.9% less than for the same period a year ago. This result is not the worst for the company, because in Estonia the fall in cargo transport reached rock bottom in 2008, when tonnage fell to 13.4 million tons for the half-year, from 22 million tons in 2007. 
The main share of the company’s cargo belongs to Russian and Belarus oil products – 72.8% of the total amount of cargo (70.4% during the previous six months), slate – 7.58% (10.7%), coal – 5.8% (1.1%) and mineral fertilisers 4.2%. Among tendencies shown over the half-year there was a gradual decrease in the movement of oil products and an increase in the transport of coal. 
There was 10.2 million tons of transit cargo, 5% more than a year ago, but local cargo flows dropped by 38% to 760,000 tons, imports by 39% to 417,000 tons, and exports by 55% to 29,000 tons.
So, 8.9 million tons of mineral oil was transported in the six months, which was 5.3% less than a year ago. Combustible slate cargoes, which previously held second place, were down 36% to 920,000 tons. Half-year coal transports moved into second place in the transport volumes chart. They grew from 160,000 to 720,000 tons. Mineral fertiliser transport was the same as the previous half-year period – 520,000 tons.  
Containers shipped in 8,18 million tons, 29% less than a year ago. The enterprise says that the recession occurred mainly because of the return of empty containers.

The Baltic Harbours: the Struggle for Russian Transits  
From January to June 2009, cargo turnover in Baltic ports was 60.11 million tons, 3.3% less than a year ago, when the harbours of Klaipeda, Tallinn, Ventspils, Riga and Liepaja handled 62.2 million tons of cargoes. This is according to data from the Latvian Ministry of Transport.
Trans-shipment volumes were best in the port of Tallinn– at about 15.35 million tons, which is 3.8% more than for the same six months last year. Next is Latvian Ventspils, with about 14.84 million tons. It handled 0.6% less cargo. Riga is in third place with about 14.79 million tons. Here volumes went up by 3%. Klaipeda came fourth with about 13.02 million tons of cargo, 18% less than before. Liepaja is last, with 2.1 million tons handled, 8.1% down. The three Latvian ports transshipped 31.73 million tons of cargo, 0.6% less than a year ago. 
For the last six months the port of Klaipeda was in the lead, but now it is showing the biggest fall in the region – 2.87 million tons of cargo down, and as a result of which it has fallen to fourth position out of the five. Arturas Drungilas, the Port Marketing Director, stated that the decrease in rates was caused by the loss of one third of oil cargoes of Lithuanian, Russian and Belarus origin. He emphasised that there was a 25% reduction in the consumption of fertilisers on the home market, and that exports went down as well, ro-ro cargoes shrank by almost a third. 
The Port of Tallinn became leader, having risen from third place in the last half-year period. The 580,000 tons growth was connected with an increase in the trans-shipment of oil cargoes from Russia and Belarus, which comes to ports by rail and sea. 
The Port of Ventspils is in second position; 100,000 tons of cargo down (mineral fertilisers, containers and ro-ro) on the previous half-year. Ventspils was also second in the region last year.  
Riga takes third position, having lost 430,000 tons in container cargoes, ro-ro, timber and metals.  
Liepaja rounds off the group. Here, oil cargo handling fell by half, and container trans-shipments shrank by almost 90%. 
Tallinn went into the lead, having handled 15.35 million tons of cargoes, which is 3.8% more than for the same period a year ago. The port specialises in processing bulk-oil cargoes, mainly dark types of oil of Russian, Belarus and Kazakh origin which come by rail, and also in tankers from other Baltic ports. However last June, Russian Vice-Premier Sergey Ivanov announced that the delivery of Russian black oil through Estonian terminals would be stopped in a year’s time, because the first phase of the trans-shipment terminal at Ust-Luga would be put into operation.
Mr Drungilas believes that the 18% decrease in cargo turnover through Klaipeda to 13.02 million tons is not crucial when the general background of the crisis is considered, despite the fact that semi-annual and monthly charts by type and kind of cargo are negative for this port. Trans-shipment of food products is the only exception; this has grown over the six-monthly period by a third to 829,000 tons. Also the trans-shipment of peat doubled to 188,900 tons. Klaipeda is focused more on handling local exports and imports. Unlike Riga, Tallinn and Ventspils, a specific feature of this Lithuanian port is that it is less dependent on transit flows. In Lithuania they believe that a growth in oil and coal cargo flows through the ports of neighbouring republics is just a matter of time. Klaipeda is looking forward optimistically – they are already expecting positive developments in cargo turnover as early as the second half of this year. 
From January to June, Ventspils trans-shipped 14.84 million tons of cargo; which is a small dip of 0.6%. In spite of being in second position in the region, a fall in cargo turnover was registered in all kinds and types of cargo, except for bulk cargo. This port specialises in the shipment of black oil, diesel fuel and gasoline from Russia and Belarus. Trans-shipment through the largest port facilities of Ventspils Nafta Terminals is supervised by the Swiss trader Vitol. Since last spring, the port has started the trans-shipment of coal through the new Baltic Coal Terminal, which belongs to the Ukrainian group “Donetskstal” – the owner of mines in Siberia.  
The Port of Riga occupied third position among the ports of the Baltics in terms of cargo turnover, having taken advantage exclusively in the growth of coal transits, oil products, and partly in bulk fertilisers. Turnover was 14.34 million tons, 3% more than a year ago. Vladimir Makarovs, the Port of Riga’s Planning & Strategic Development Department Director, thinks that currently the region is going through a period of fierce competition for each ton of cargo and each dollar of profit. Mergers in the stevedore business are expected in the port of the capital. Smaller companies will be sold or absorbed by larger ones. So far, active negotiations are taking place with new cargo owners, who are interested in coal, mineral fertilisers and bulk oil trans-shipment. 
Natalia Don 
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The Railway: Change of Leaders  
Railway companies in the Baltics have transported 60.08 million tons of cargo in the first half of this year, which is 13.9% less than for the same period the year before, when 69.8 million tons of cargo was transported. First of all, the reduction can be explained by the economic crisis. But when considering the work of companies, generally speaking, many factors influenced their activity. 
These include the reorientation of cargo flows (over the year almost all potash fertiliser produced in Belarus went from Latvia to Lithuania), a decrease in the movement of seasonal cargoes, tariff negotiations that have gone on for too long over transit movement across Lithuania, because of which Lithuania has lost almost half of its transit cargoes in the Kaliningrad region. The falling figures in Estonia are basically connected to a policy to decrease exports of Russian oil products.   
Latvian LDz Cargo, a branch of Latvijas dzelzcels (LDz), had the largest share of the 60.08 million tons carried over the half-year by Baltic railways. It transported 28.17 million tons (1.2% more than the same period last year). In second place was the Lithuanian company Lietuvos gelezinkeliai with about 19.76 million tons (31.1% less than before). Third place, with about 12.21 million tons was Estonian company Eesti Raudtee (a fall of 8.8%).  
During the first half of the year, Latvians managed to stay leaders, having occupied almost half of the transport market by enlarging their transit cargo flows of coal, oil, oil products and chemicals, mostly of Russian and Belarus origin. Lithuanians had to retreat into second place. As of June of the current year, they have lost about a third of their cargoes, or nearly 33% of the market. Oil and oil product transits fell, as well as fertilisers and mineral products. In third position are the Estonians, and their market share in transits has grown by 20% compared with the same period last year, due to the transit of black oil from Russia and Belarus.

The Leader is LDz Cargo
Successful activity, long-term transit agreements on Russian, Lithuanian, Belarus and Kazakh oil, oil products, coal and mineral fertilisers have allowed the company to be called a leading carrier in the region. During that half-year, the share of Russian cargoes was 69.1% of all cargoes (last year it was 61.2% for the same period), Belarus cargoes 23.8% (25.8% last year), and Lithuanian cargoes (6%).
Good results were achieved because import traffic grew to 24.8 million tons, including through the ports of Latvia, where 11.6% – or 23.3 million tons – more cargo was transported. Simultaneously exports, local cargo flows and overland transit cargoes fell. Exports have fallen by 5.6% to 1.13 million tons, if you compare it with about 1.2 million tons in the first half of last year. 
Internal cargo has fallen by 23% to 602,000 tons and overland transit (basically only oil products) through Latvian territory to Estonia decreased by 40% to 1.5 million tons.  
LDz Cargo has traditionally transported mostly oil and oil products, which is 41% of all cargoes (the previous half year figure was 34.8%), coal was 36.5% of the entire volume (33.1% last year), mineral fertilisers – 5.5% (9.3% in the same half-year period last year).  
Oil and oil products transported reached 11.54 million tons over the first six months, which is 12% more than for the same period last year. 
Traffic in the second largest cargo group, coal and coke, grew by 16.9% and reached 10.31 million tons. Monthly growth is stable, but in spring there was a small percentage recession because of falling energy demand in the world market. Chemical cargo flows grew by 20.2% to 1.45 million tons. 
There was a positive tendency in the container transport market, which grew by 0.2%, to 27.44 million tons as a result of the delivery of motor vehicles to Kazakhstan and non-military cargoes to Afghanistan. Among negative tendencies there was a reduction in grain transit by 26.5% and by 36.1% in mineral fertilisers. The largest falls were in cargoes such as sugar (61.5% down) and timber (60.3% down).

Lietuvos gelezinkeliai. Fall is stabilising
Lithuanian railway company Lietuvos gelezinkeliai transported 19.74 million tons of cargo in the accounting period, which was 31.1% less than for the half-year in 2008. Falls in cargo movements were noticed in all directions and in practically all cargo items, both within the half-year, and on a monthly basis. Experts believe that such falls have taken place not only as a result of the general economic situation, but also because of the tariff “wars”, with Lithuanians losing about half of their cargoes in the direction of the Kaliningrad Region.      
So, internal transport fell by 15.7% to 6.2 million tons because of reduced consumer demand in the republic, imports fell by 32.8% to 5.7 million tons, exports by 31.6% to 1.9 million tons, and transits by 40.6% to 5.86 million tons. The transit cargo sector showed the biggest fall. International transport, including exports, imports and transits, decreased by 36.4% to 13.5 million tons. 
The company’s main cargoes are oil products, fertilisers and mineral products. Over the accounting period, 47.7% of the total cargo flow was oil and oil products (this figure in the previous half-year period was 42%), fertilisers – 19.9% (a year ago this figure was 19.1%), mineral products – 6.12% (9.49% in the previous half-year). For the same accounting period, oil and oil products flows were 9.42 million tons, a reduction of 21.8%, fertilisers fell by 28.3% to 3.98 million tons, and other cargoes were 29.4% down to 2.5 million tons.  
The worst fall was in the transport of the company’s main cargo group – mineral products. Their flows were halved, down to 1.21 million tons. Coal and coke shipments were 48.5% down, to 955,000 tons, ferrous metals by 65% to 703,000 tons. The only cargo group where growth was noticed was phyto-originated products – 992,000 tons, or 8% up.   

Eesti Raudtee: Lots of Black Oil and More Coal 
Estonian enterprise Eesti Raudtee transported 12.21 million tons of cargo; 8.9% less than for the same period a year ago. This result is not the worst for the company, because in Estonia the fall in cargo transport reached rock bottom in 2008, when tonnage fell to 13.4 million tons for the half-year, from 22 million tons in 2007. 
The main share of the company’s cargo belongs to Russian and Belarus oil products – 72.8% of the total amount of cargo (70.4% during the previous six months), slate – 7.58% (10.7%), coal – 5.8% (1.1%) and mineral fertilisers 4.2%. Among tendencies shown over the half-year there was a gradual decrease in the movement of oil products and an increase in the transport of coal. 
There was 10.2 million tons of transit cargo, 5% more than a year ago, but local cargo flows dropped by 38% to 760,000 tons, imports by 39% to 417,000 tons, and exports by 55% to 29,000 tons.
So, 8.9 million tons of mineral oil was transported in the six months, which was 5.3% less than a year ago. Combustible slate cargoes, which previously held second place, were down 36% to 920,000 tons. Half-year coal transports moved into second place in the transport volumes chart. They grew from 160,000 to 720,000 tons. Mineral fertiliser transport was the same as the previous half-year period – 520,000 tons.  
Containers shipped in 8,18 million tons, 29% less than a year ago. The enterprise says that the recession occurred mainly because of the return of empty containers.

The Baltic Harbours: the Struggle for Russian Transits  
From January to June 2009, cargo turnover in Baltic ports was 60.11 million tons, 3.3% less than a year ago, when the harbours of Klaipeda, Tallinn, Ventspils, Riga and Liepaja handled 62.2 million tons of cargoes. This is according to data from the Latvian Ministry of Transport.
Trans-shipment volumes were best in the port of Tallinn– at about 15.35 million tons, which is 3.8% more than for the same six months last year. Next is Latvian Ventspils, with about 14.84 million tons. It handled 0.6% less cargo. Riga is in third place with about 14.79 million tons. Here volumes went up by 3%. Klaipeda came fourth with about 13.02 million tons of cargo, 18% less than before. Liepaja is last, with 2.1 million tons handled, 8.1% down. The three Latvian ports transshipped 31.73 million tons of cargo, 0.6% less than a year ago. 
For the last six months the port of Klaipeda was in the lead, but now it is showing the biggest fall in the region – 2.87 million tons of cargo down, and as a result of which it has fallen to fourth position out of the five. Arturas Drungilas, the Port Marketing Director, stated that the decrease in rates was caused by the loss of one third of oil cargoes of Lithuanian, Russian and Belarus origin. He emphasised that there was a 25% reduction in the consumption of fertilisers on the home market, and that exports went down as well, ro-ro cargoes shrank by almost a third. 
The Port of Tallinn became leader, having risen from third place in the last half-year period. The 580,000 tons growth was connected with an increase in the trans-shipment of oil cargoes from Russia and Belarus, which comes to ports by rail and sea. 
The Port of Ventspils is in second position; 100,000 tons of cargo down (mineral fertilisers, containers and ro-ro) on the previous half-year. Ventspils was also second in the region last year.  
Riga takes third position, having lost 430,000 tons in container cargoes, ro-ro, timber and metals.  
Liepaja rounds off the group. Here, oil cargo handling fell by half, and container trans-shipments shrank by almost 90%. 
Tallinn went into the lead, having handled 15.35 million tons of cargoes, which is 3.8% more than for the same period a year ago. The port specialises in processing bulk-oil cargoes, mainly dark types of oil of Russian, Belarus and Kazakh origin which come by rail, and also in tankers from other Baltic ports. However last June, Russian Vice-Premier Sergey Ivanov announced that the delivery of Russian black oil through Estonian terminals would be stopped in a year’s time, because the first phase of the trans-shipment terminal at Ust-Luga would be put into operation.
Mr Drungilas believes that the 18% decrease in cargo turnover through Klaipeda to 13.02 million tons is not crucial when the general background of the crisis is considered, despite the fact that semi-annual and monthly charts by type and kind of cargo are negative for this port. Trans-shipment of food products is the only exception; this has grown over the six-monthly period by a third to 829,000 tons. Also the trans-shipment of peat doubled to 188,900 tons. Klaipeda is focused more on handling local exports and imports. Unlike Riga, Tallinn and Ventspils, a specific feature of this Lithuanian port is that it is less dependent on transit flows. In Lithuania they believe that a growth in oil and coal cargo flows through the ports of neighbouring republics is just a matter of time. Klaipeda is looking forward optimistically – they are already expecting positive developments in cargo turnover as early as the second half of this year. 
From January to June, Ventspils trans-shipped 14.84 million tons of cargo; which is a small dip of 0.6%. In spite of being in second position in the region, a fall in cargo turnover was registered in all kinds and types of cargo, except for bulk cargo. This port specialises in the shipment of black oil, diesel fuel and gasoline from Russia and Belarus. Trans-shipment through the largest port facilities of Ventspils Nafta Terminals is supervised by the Swiss trader Vitol. Since last spring, the port has started the trans-shipment of coal through the new Baltic Coal Terminal, which belongs to the Ukrainian group “Donetskstal” – the owner of mines in Siberia.  
The Port of Riga occupied third position among the ports of the Baltics in terms of cargo turnover, having taken advantage exclusively in the growth of coal transits, oil products, and partly in bulk fertilisers. Turnover was 14.34 million tons, 3% more than a year ago. Vladimir Makarovs, the Port of Riga’s Planning & Strategic Development Department Director, thinks that currently the region is going through a period of fierce competition for each ton of cargo and each dollar of profit. Mergers in the stevedore business are expected in the port of the capital. Smaller companies will be sold or absorbed by larger ones. So far, active negotiations are taking place with new cargo owners, who are interested in coal, mineral fertilisers and bulk oil trans-shipment. 
Natalia Don 
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            [SECTION_META_DESCRIPTION] => <img src="/ufiles/image/rus/partner/2009/3/6.jpg" border="1" alt=" " hspace="5" width="200" height="469" align="left" />In the first half of 2009 cargo transshipments through Baltic ports shrank by 3.3% to 60.11 million tons in comparison with the same period of 2008. Rail cargo in this region fell by 13.9% to 60.08 million tons. However, experts believe that it is too early to draw negative conclusions
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            [ELEMENT_META_DESCRIPTION] => <img src="/ufiles/image/rus/partner/2009/3/6.jpg" border="1" alt=" " hspace="5" width="200" height="469" align="left" />In the first half of 2009 cargo transshipments through Baltic ports shrank by 3.3% to 60.11 million tons in comparison with the same period of 2008. Rail cargo in this region fell by 13.9% to 60.08 million tons. However, experts believe that it is too early to draw negative conclusions
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The Railway: Change of Leaders  
Railway companies in the Baltics have transported 60.08 million tons of cargo in the first half of this year, which is 13.9% less than for the same period the year before, when 69.8 million tons of cargo was transported. First of all, the reduction can be explained by the economic crisis. But when considering the work of companies, generally speaking, many factors influenced their activity. 
These include the reorientation of cargo flows (over the year almost all potash fertiliser produced in Belarus went from Latvia to Lithuania), a decrease in the movement of seasonal cargoes, tariff negotiations that have gone on for too long over transit movement across Lithuania, because of which Lithuania has lost almost half of its transit cargoes in the Kaliningrad region. The falling figures in Estonia are basically connected to a policy to decrease exports of Russian oil products.   
Latvian LDz Cargo, a branch of Latvijas dzelzcels (LDz), had the largest share of the 60.08 million tons carried over the half-year by Baltic railways. It transported 28.17 million tons (1.2% more than the same period last year). In second place was the Lithuanian company Lietuvos gelezinkeliai with about 19.76 million tons (31.1% less than before). Third place, with about 12.21 million tons was Estonian company Eesti Raudtee (a fall of 8.8%).  
During the first half of the year, Latvians managed to stay leaders, having occupied almost half of the transport market by enlarging their transit cargo flows of coal, oil, oil products and chemicals, mostly of Russian and Belarus origin. Lithuanians had to retreat into second place. As of June of the current year, they have lost about a third of their cargoes, or nearly 33% of the market. Oil and oil product transits fell, as well as fertilisers and mineral products. In third position are the Estonians, and their market share in transits has grown by 20% compared with the same period last year, due to the transit of black oil from Russia and Belarus.

The Leader is LDz Cargo
Successful activity, long-term transit agreements on Russian, Lithuanian, Belarus and Kazakh oil, oil products, coal and mineral fertilisers have allowed the company to be called a leading carrier in the region. During that half-year, the share of Russian cargoes was 69.1% of all cargoes (last year it was 61.2% for the same period), Belarus cargoes 23.8% (25.8% last year), and Lithuanian cargoes (6%).
Good results were achieved because import traffic grew to 24.8 million tons, including through the ports of Latvia, where 11.6% – or 23.3 million tons – more cargo was transported. Simultaneously exports, local cargo flows and overland transit cargoes fell. Exports have fallen by 5.6% to 1.13 million tons, if you compare it with about 1.2 million tons in the first half of last year. 
Internal cargo has fallen by 23% to 602,000 tons and overland transit (basically only oil products) through Latvian territory to Estonia decreased by 40% to 1.5 million tons.  
LDz Cargo has traditionally transported mostly oil and oil products, which is 41% of all cargoes (the previous half year figure was 34.8%), coal was 36.5% of the entire volume (33.1% last year), mineral fertilisers – 5.5% (9.3% in the same half-year period last year).  
Oil and oil products transported reached 11.54 million tons over the first six months, which is 12% more than for the same period last year. 
Traffic in the second largest cargo group, coal and coke, grew by 16.9% and reached 10.31 million tons. Monthly growth is stable, but in spring there was a small percentage recession because of falling energy demand in the world market. Chemical cargo flows grew by 20.2% to 1.45 million tons. 
There was a positive tendency in the container transport market, which grew by 0.2%, to 27.44 million tons as a result of the delivery of motor vehicles to Kazakhstan and non-military cargoes to Afghanistan. Among negative tendencies there was a reduction in grain transit by 26.5% and by 36.1% in mineral fertilisers. The largest falls were in cargoes such as sugar (61.5% down) and timber (60.3% down).

Lietuvos gelezinkeliai. Fall is stabilising
Lithuanian railway company Lietuvos gelezinkeliai transported 19.74 million tons of cargo in the accounting period, which was 31.1% less than for the half-year in 2008. Falls in cargo movements were noticed in all directions and in practically all cargo items, both within the half-year, and on a monthly basis. Experts believe that such falls have taken place not only as a result of the general economic situation, but also because of the tariff “wars”, with Lithuanians losing about half of their cargoes in the direction of the Kaliningrad Region.      
So, internal transport fell by 15.7% to 6.2 million tons because of reduced consumer demand in the republic, imports fell by 32.8% to 5.7 million tons, exports by 31.6% to 1.9 million tons, and transits by 40.6% to 5.86 million tons. The transit cargo sector showed the biggest fall. International transport, including exports, imports and transits, decreased by 36.4% to 13.5 million tons. 
The company’s main cargoes are oil products, fertilisers and mineral products. Over the accounting period, 47.7% of the total cargo flow was oil and oil products (this figure in the previous half-year period was 42%), fertilisers – 19.9% (a year ago this figure was 19.1%), mineral products – 6.12% (9.49% in the previous half-year). For the same accounting period, oil and oil products flows were 9.42 million tons, a reduction of 21.8%, fertilisers fell by 28.3% to 3.98 million tons, and other cargoes were 29.4% down to 2.5 million tons.  
The worst fall was in the transport of the company’s main cargo group – mineral products. Their flows were halved, down to 1.21 million tons. Coal and coke shipments were 48.5% down, to 955,000 tons, ferrous metals by 65% to 703,000 tons. The only cargo group where growth was noticed was phyto-originated products – 992,000 tons, or 8% up.   

Eesti Raudtee: Lots of Black Oil and More Coal 
Estonian enterprise Eesti Raudtee transported 12.21 million tons of cargo; 8.9% less than for the same period a year ago. This result is not the worst for the company, because in Estonia the fall in cargo transport reached rock bottom in 2008, when tonnage fell to 13.4 million tons for the half-year, from 22 million tons in 2007. 
The main share of the company’s cargo belongs to Russian and Belarus oil products – 72.8% of the total amount of cargo (70.4% during the previous six months), slate – 7.58% (10.7%), coal – 5.8% (1.1%) and mineral fertilisers 4.2%. Among tendencies shown over the half-year there was a gradual decrease in the movement of oil products and an increase in the transport of coal. 
There was 10.2 million tons of transit cargo, 5% more than a year ago, but local cargo flows dropped by 38% to 760,000 tons, imports by 39% to 417,000 tons, and exports by 55% to 29,000 tons.
So, 8.9 million tons of mineral oil was transported in the six months, which was 5.3% less than a year ago. Combustible slate cargoes, which previously held second place, were down 36% to 920,000 tons. Half-year coal transports moved into second place in the transport volumes chart. They grew from 160,000 to 720,000 tons. Mineral fertiliser transport was the same as the previous half-year period – 520,000 tons.  
Containers shipped in 8,18 million tons, 29% less than a year ago. The enterprise says that the recession occurred mainly because of the return of empty containers.

The Baltic Harbours: the Struggle for Russian Transits  
From January to June 2009, cargo turnover in Baltic ports was 60.11 million tons, 3.3% less than a year ago, when the harbours of Klaipeda, Tallinn, Ventspils, Riga and Liepaja handled 62.2 million tons of cargoes. This is according to data from the Latvian Ministry of Transport.
Trans-shipment volumes were best in the port of Tallinn– at about 15.35 million tons, which is 3.8% more than for the same six months last year. Next is Latvian Ventspils, with about 14.84 million tons. It handled 0.6% less cargo. Riga is in third place with about 14.79 million tons. Here volumes went up by 3%. Klaipeda came fourth with about 13.02 million tons of cargo, 18% less than before. Liepaja is last, with 2.1 million tons handled, 8.1% down. The three Latvian ports transshipped 31.73 million tons of cargo, 0.6% less than a year ago. 
For the last six months the port of Klaipeda was in the lead, but now it is showing the biggest fall in the region – 2.87 million tons of cargo down, and as a result of which it has fallen to fourth position out of the five. Arturas Drungilas, the Port Marketing Director, stated that the decrease in rates was caused by the loss of one third of oil cargoes of Lithuanian, Russian and Belarus origin. He emphasised that there was a 25% reduction in the consumption of fertilisers on the home market, and that exports went down as well, ro-ro cargoes shrank by almost a third. 
The Port of Tallinn became leader, having risen from third place in the last half-year period. The 580,000 tons growth was connected with an increase in the trans-shipment of oil cargoes from Russia and Belarus, which comes to ports by rail and sea. 
The Port of Ventspils is in second position; 100,000 tons of cargo down (mineral fertilisers, containers and ro-ro) on the previous half-year. Ventspils was also second in the region last year.  
Riga takes third position, having lost 430,000 tons in container cargoes, ro-ro, timber and metals.  
Liepaja rounds off the group. Here, oil cargo handling fell by half, and container trans-shipments shrank by almost 90%. 
Tallinn went into the lead, having handled 15.35 million tons of cargoes, which is 3.8% more than for the same period a year ago. The port specialises in processing bulk-oil cargoes, mainly dark types of oil of Russian, Belarus and Kazakh origin which come by rail, and also in tankers from other Baltic ports. However last June, Russian Vice-Premier Sergey Ivanov announced that the delivery of Russian black oil through Estonian terminals would be stopped in a year’s time, because the first phase of the trans-shipment terminal at Ust-Luga would be put into operation.
Mr Drungilas believes that the 18% decrease in cargo turnover through Klaipeda to 13.02 million tons is not crucial when the general background of the crisis is considered, despite the fact that semi-annual and monthly charts by type and kind of cargo are negative for this port. Trans-shipment of food products is the only exception; this has grown over the six-monthly period by a third to 829,000 tons. Also the trans-shipment of peat doubled to 188,900 tons. Klaipeda is focused more on handling local exports and imports. Unlike Riga, Tallinn and Ventspils, a specific feature of this Lithuanian port is that it is less dependent on transit flows. In Lithuania they believe that a growth in oil and coal cargo flows through the ports of neighbouring republics is just a matter of time. Klaipeda is looking forward optimistically – they are already expecting positive developments in cargo turnover as early as the second half of this year. 
From January to June, Ventspils trans-shipped 14.84 million tons of cargo; which is a small dip of 0.6%. In spite of being in second position in the region, a fall in cargo turnover was registered in all kinds and types of cargo, except for bulk cargo. This port specialises in the shipment of black oil, diesel fuel and gasoline from Russia and Belarus. Trans-shipment through the largest port facilities of Ventspils Nafta Terminals is supervised by the Swiss trader Vitol. Since last spring, the port has started the trans-shipment of coal through the new Baltic Coal Terminal, which belongs to the Ukrainian group “Donetskstal” – the owner of mines in Siberia.  
The Port of Riga occupied third position among the ports of the Baltics in terms of cargo turnover, having taken advantage exclusively in the growth of coal transits, oil products, and partly in bulk fertilisers. Turnover was 14.34 million tons, 3% more than a year ago. Vladimir Makarovs, the Port of Riga’s Planning & Strategic Development Department Director, thinks that currently the region is going through a period of fierce competition for each ton of cargo and each dollar of profit. Mergers in the stevedore business are expected in the port of the capital. Smaller companies will be sold or absorbed by larger ones. So far, active negotiations are taking place with new cargo owners, who are interested in coal, mineral fertilisers and bulk oil trans-shipment. 
Natalia Don 
    [~DETAIL_TEXT] => 
The Railway: Change of Leaders  
Railway companies in the Baltics have transported 60.08 million tons of cargo in the first half of this year, which is 13.9% less than for the same period the year before, when 69.8 million tons of cargo was transported. First of all, the reduction can be explained by the economic crisis. But when considering the work of companies, generally speaking, many factors influenced their activity. 
These include the reorientation of cargo flows (over the year almost all potash fertiliser produced in Belarus went from Latvia to Lithuania), a decrease in the movement of seasonal cargoes, tariff negotiations that have gone on for too long over transit movement across Lithuania, because of which Lithuania has lost almost half of its transit cargoes in the Kaliningrad region. The falling figures in Estonia are basically connected to a policy to decrease exports of Russian oil products.   
Latvian LDz Cargo, a branch of Latvijas dzelzcels (LDz), had the largest share of the 60.08 million tons carried over the half-year by Baltic railways. It transported 28.17 million tons (1.2% more than the same period last year). In second place was the Lithuanian company Lietuvos gelezinkeliai with about 19.76 million tons (31.1% less than before). Third place, with about 12.21 million tons was Estonian company Eesti Raudtee (a fall of 8.8%).  
During the first half of the year, Latvians managed to stay leaders, having occupied almost half of the transport market by enlarging their transit cargo flows of coal, oil, oil products and chemicals, mostly of Russian and Belarus origin. Lithuanians had to retreat into second place. As of June of the current year, they have lost about a third of their cargoes, or nearly 33% of the market. Oil and oil product transits fell, as well as fertilisers and mineral products. In third position are the Estonians, and their market share in transits has grown by 20% compared with the same period last year, due to the transit of black oil from Russia and Belarus.

The Leader is LDz Cargo
Successful activity, long-term transit agreements on Russian, Lithuanian, Belarus and Kazakh oil, oil products, coal and mineral fertilisers have allowed the company to be called a leading carrier in the region. During that half-year, the share of Russian cargoes was 69.1% of all cargoes (last year it was 61.2% for the same period), Belarus cargoes 23.8% (25.8% last year), and Lithuanian cargoes (6%).
Good results were achieved because import traffic grew to 24.8 million tons, including through the ports of Latvia, where 11.6% – or 23.3 million tons – more cargo was transported. Simultaneously exports, local cargo flows and overland transit cargoes fell. Exports have fallen by 5.6% to 1.13 million tons, if you compare it with about 1.2 million tons in the first half of last year. 
Internal cargo has fallen by 23% to 602,000 tons and overland transit (basically only oil products) through Latvian territory to Estonia decreased by 40% to 1.5 million tons.  
LDz Cargo has traditionally transported mostly oil and oil products, which is 41% of all cargoes (the previous half year figure was 34.8%), coal was 36.5% of the entire volume (33.1% last year), mineral fertilisers – 5.5% (9.3% in the same half-year period last year).  
Oil and oil products transported reached 11.54 million tons over the first six months, which is 12% more than for the same period last year. 
Traffic in the second largest cargo group, coal and coke, grew by 16.9% and reached 10.31 million tons. Monthly growth is stable, but in spring there was a small percentage recession because of falling energy demand in the world market. Chemical cargo flows grew by 20.2% to 1.45 million tons. 
There was a positive tendency in the container transport market, which grew by 0.2%, to 27.44 million tons as a result of the delivery of motor vehicles to Kazakhstan and non-military cargoes to Afghanistan. Among negative tendencies there was a reduction in grain transit by 26.5% and by 36.1% in mineral fertilisers. The largest falls were in cargoes such as sugar (61.5% down) and timber (60.3% down).

Lietuvos gelezinkeliai. Fall is stabilising
Lithuanian railway company Lietuvos gelezinkeliai transported 19.74 million tons of cargo in the accounting period, which was 31.1% less than for the half-year in 2008. Falls in cargo movements were noticed in all directions and in practically all cargo items, both within the half-year, and on a monthly basis. Experts believe that such falls have taken place not only as a result of the general economic situation, but also because of the tariff “wars”, with Lithuanians losing about half of their cargoes in the direction of the Kaliningrad Region.      
So, internal transport fell by 15.7% to 6.2 million tons because of reduced consumer demand in the republic, imports fell by 32.8% to 5.7 million tons, exports by 31.6% to 1.9 million tons, and transits by 40.6% to 5.86 million tons. The transit cargo sector showed the biggest fall. International transport, including exports, imports and transits, decreased by 36.4% to 13.5 million tons. 
The company’s main cargoes are oil products, fertilisers and mineral products. Over the accounting period, 47.7% of the total cargo flow was oil and oil products (this figure in the previous half-year period was 42%), fertilisers – 19.9% (a year ago this figure was 19.1%), mineral products – 6.12% (9.49% in the previous half-year). For the same accounting period, oil and oil products flows were 9.42 million tons, a reduction of 21.8%, fertilisers fell by 28.3% to 3.98 million tons, and other cargoes were 29.4% down to 2.5 million tons.  
The worst fall was in the transport of the company’s main cargo group – mineral products. Their flows were halved, down to 1.21 million tons. Coal and coke shipments were 48.5% down, to 955,000 tons, ferrous metals by 65% to 703,000 tons. The only cargo group where growth was noticed was phyto-originated products – 992,000 tons, or 8% up.   

Eesti Raudtee: Lots of Black Oil and More Coal 
Estonian enterprise Eesti Raudtee transported 12.21 million tons of cargo; 8.9% less than for the same period a year ago. This result is not the worst for the company, because in Estonia the fall in cargo transport reached rock bottom in 2008, when tonnage fell to 13.4 million tons for the half-year, from 22 million tons in 2007. 
The main share of the company’s cargo belongs to Russian and Belarus oil products – 72.8% of the total amount of cargo (70.4% during the previous six months), slate – 7.58% (10.7%), coal – 5.8% (1.1%) and mineral fertilisers 4.2%. Among tendencies shown over the half-year there was a gradual decrease in the movement of oil products and an increase in the transport of coal. 
There was 10.2 million tons of transit cargo, 5% more than a year ago, but local cargo flows dropped by 38% to 760,000 tons, imports by 39% to 417,000 tons, and exports by 55% to 29,000 tons.
So, 8.9 million tons of mineral oil was transported in the six months, which was 5.3% less than a year ago. Combustible slate cargoes, which previously held second place, were down 36% to 920,000 tons. Half-year coal transports moved into second place in the transport volumes chart. They grew from 160,000 to 720,000 tons. Mineral fertiliser transport was the same as the previous half-year period – 520,000 tons.  
Containers shipped in 8,18 million tons, 29% less than a year ago. The enterprise says that the recession occurred mainly because of the return of empty containers.

The Baltic Harbours: the Struggle for Russian Transits  
From January to June 2009, cargo turnover in Baltic ports was 60.11 million tons, 3.3% less than a year ago, when the harbours of Klaipeda, Tallinn, Ventspils, Riga and Liepaja handled 62.2 million tons of cargoes. This is according to data from the Latvian Ministry of Transport.
Trans-shipment volumes were best in the port of Tallinn– at about 15.35 million tons, which is 3.8% more than for the same six months last year. Next is Latvian Ventspils, with about 14.84 million tons. It handled 0.6% less cargo. Riga is in third place with about 14.79 million tons. Here volumes went up by 3%. Klaipeda came fourth with about 13.02 million tons of cargo, 18% less than before. Liepaja is last, with 2.1 million tons handled, 8.1% down. The three Latvian ports transshipped 31.73 million tons of cargo, 0.6% less than a year ago. 
For the last six months the port of Klaipeda was in the lead, but now it is showing the biggest fall in the region – 2.87 million tons of cargo down, and as a result of which it has fallen to fourth position out of the five. Arturas Drungilas, the Port Marketing Director, stated that the decrease in rates was caused by the loss of one third of oil cargoes of Lithuanian, Russian and Belarus origin. He emphasised that there was a 25% reduction in the consumption of fertilisers on the home market, and that exports went down as well, ro-ro cargoes shrank by almost a third. 
The Port of Tallinn became leader, having risen from third place in the last half-year period. The 580,000 tons growth was connected with an increase in the trans-shipment of oil cargoes from Russia and Belarus, which comes to ports by rail and sea. 
The Port of Ventspils is in second position; 100,000 tons of cargo down (mineral fertilisers, containers and ro-ro) on the previous half-year. Ventspils was also second in the region last year.  
Riga takes third position, having lost 430,000 tons in container cargoes, ro-ro, timber and metals.  
Liepaja rounds off the group. Here, oil cargo handling fell by half, and container trans-shipments shrank by almost 90%. 
Tallinn went into the lead, having handled 15.35 million tons of cargoes, which is 3.8% more than for the same period a year ago. The port specialises in processing bulk-oil cargoes, mainly dark types of oil of Russian, Belarus and Kazakh origin which come by rail, and also in tankers from other Baltic ports. However last June, Russian Vice-Premier Sergey Ivanov announced that the delivery of Russian black oil through Estonian terminals would be stopped in a year’s time, because the first phase of the trans-shipment terminal at Ust-Luga would be put into operation.
Mr Drungilas believes that the 18% decrease in cargo turnover through Klaipeda to 13.02 million tons is not crucial when the general background of the crisis is considered, despite the fact that semi-annual and monthly charts by type and kind of cargo are negative for this port. Trans-shipment of food products is the only exception; this has grown over the six-monthly period by a third to 829,000 tons. Also the trans-shipment of peat doubled to 188,900 tons. Klaipeda is focused more on handling local exports and imports. Unlike Riga, Tallinn and Ventspils, a specific feature of this Lithuanian port is that it is less dependent on transit flows. In Lithuania they believe that a growth in oil and coal cargo flows through the ports of neighbouring republics is just a matter of time. Klaipeda is looking forward optimistically – they are already expecting positive developments in cargo turnover as early as the second half of this year. 
From January to June, Ventspils trans-shipped 14.84 million tons of cargo; which is a small dip of 0.6%. In spite of being in second position in the region, a fall in cargo turnover was registered in all kinds and types of cargo, except for bulk cargo. This port specialises in the shipment of black oil, diesel fuel and gasoline from Russia and Belarus. Trans-shipment through the largest port facilities of Ventspils Nafta Terminals is supervised by the Swiss trader Vitol. Since last spring, the port has started the trans-shipment of coal through the new Baltic Coal Terminal, which belongs to the Ukrainian group “Donetskstal” – the owner of mines in Siberia.  
The Port of Riga occupied third position among the ports of the Baltics in terms of cargo turnover, having taken advantage exclusively in the growth of coal transits, oil products, and partly in bulk fertilisers. Turnover was 14.34 million tons, 3% more than a year ago. Vladimir Makarovs, the Port of Riga’s Planning & Strategic Development Department Director, thinks that currently the region is going through a period of fierce competition for each ton of cargo and each dollar of profit. Mergers in the stevedore business are expected in the port of the capital. Smaller companies will be sold or absorbed by larger ones. So far, active negotiations are taking place with new cargo owners, who are interested in coal, mineral fertilisers and bulk oil trans-shipment. 
Natalia Don 
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Equal Conditions for All Market Players 
The current structure of the rail transportation services market in Russia may be called operators-oriented, implying it creates an environment they can benefit from more even than RZD, the largest player in the guise of the wholly state-owned rail carrier. This paradox can be explained if we have a look at the distribution of obligations on both parties and today’s practice of tariff policy applied within the industry. 
While RZD is responsible for the shipment of all cargoes by set tariffs which cannot be changed without the decree of the RF Federal Tariff Service, private operators of rolling stock are free to choose attractive cargoes and lucrative routes. Moreover, they can reduce the price of their services by up to 15% or on the contrary make it higher than the price of RZD in return to more client-oriented services. 15% here is the size of a wagon constituent within the tariff, and all owners of rolling stock, except RZD, have a right to shift this constituent as they find it possible or profitable. Such flexibility in obligations and price policy enabled the operators to win attractive clients, get value-added cargoes and occupy interesting directions over the past few years, while RZD was forced to handle with one-wagon shipments and cheap cargoes, thus losing the competition. 
In an attempt to create equal conditions for all players, RZD offered a plan to reform the industry. Initially, according to the plan, first discussed in 2006, the idea was to set up an RZD freight subsidiary which would have the same rights and obligations as any other operator. The set-up was supposed to be made through transferring part of the rolling stock managed by RZD to this company. But the step was strongly opposed by both private companies and officials from the Ministry of Transport. The main objection was that the new player will be as strong as RZD itself but would be free from state supervision, and this situation could be dangerous for the current level of competition. Then RZD and the Ministry of Transport agreed to create two freight companies which could boost competition and at the same make it possible for RZD to compete with private operators on equal terms.  
The First Freight Company (FFC, or Freight One) started its operations in late 2007, and now the park of the operator numbers more than 200 000 cars of different types (see our Rating, page 26) which is about one third of the market total. 
“Any choice on developing the operation of rolling stock and restructuring RZD’s wagon fleet must take into account the need to ensure equal conditions on the freight cars market, as well as ensure uninterrupted traffic flows, especially for socially important goods. This in turn has to be based on the equal responsibility of all market players. 
The key challenge to be solved when reforming the system for the provision of freight cars is to increase the actual output of the freight car fleet. This assumes the implementation of all order volumes using the minimum number of wagons from the fleet with the maximum mileage per loaded car per annum,” said RZD’s press office in a statement after the company finalised its decision to set up the operator in late May this year.
RZD considers that at the same time as establishing the SFC, it is necessary to ensure the development of a regulatory framework, technological standards and rules for the effective functioning of the market in the new environment. Such initiatives will be sent to the RF Ministry of Transport and other relevant federal authorities to prepare agreed solutions. It is anticipated that improving the regulatory framework and rules will be completed by the time the SFC is founded. 
RZD will develop a business plan for the SFC based on the approved concept, which will then be considered by RZD’s board of directors.

Financiers Are Very Cautious 
The scheme for the creation of the SFC slightly differs from the one used for Freight One. RZD is signing over 217 000 wagons to the SFC, thus making it as strong as the FFC and encouraging competition between its two freight subsidiaries. (RZD itself will hold a few thousands of wagons used for incorporated shipments and in the future is going to be turned into an infrastructure company with stock in rail freight operators). The main difference is that the owners of rolling stock are being invited to become shareholders in the operator. All they have to do is give their wagons to the SFC in return for dividends and an opportunity to influence corporate governance. With private rolling stock,  the entire park of the SFC is predicted to reach 265 000 – 283 000 wagons in the next few years. The park of the Freight One in the future is estimated at 266 000 wagons. 
RZD President Vladimir Yakunin said that the forming of ownership capital and distribution of shares between would-be owners would be made according to a special methodology of assets valuation.  This methodology is still to be worked out, but it is already known that the rolling stock of private owners to be brought into the stock of the SFC will be valued in accordance with market prices. The same goes for RZD’s wagons that are to be transferred to the operator. In the first phase of the creation of the company, private owners can get up to 25%+1 share, in the future the private share could be significantly enlarged, to about half the capital.
The offer from RZD seems to be timed very well. The economic crisis seriously hit the rail shipment industry, and it happened just the years when private companies had been purchasing rolling stock very actively. Most of the wagons were being bought with the help of leasing schemes or borrowed money. Importantly, bank borrow rates in Russia are very high because of the high inflation rate which has not dropped to single digits, according to official data. The real inflation rate, say economists, might be even higher than the state statistics body says. 
The crisis closed paths to refinancing, which coupled with volumes shipped by rail was a factor contributing to threats to insolvency for many operators. Many leasing companies faced the problem of non-payment still in late 2008 and were forced to make the decision on what to do with their assets: give them payback from railway operators or giving their clients installments. The proposal from RZD promises to free the financiers, leasing companies and freight owners from the headache and prospects of getting into “red zone”, since idle of rolling stock nonetheless demands expenses for maintenance as well as paying taxes.

Business Seeks More Clarity 
This summer Vladimir Yakunin said RZD was in negotiations with national major banks including Vneshtorgbank and Sberbank as sources of funds to purchase rolling stock. There are also negotiations with the European Bank for Reconstruction and Development (EBRD). EBRD confirmed it had expressed an interest in the possible participation in the SFC. Andrey Kostin, the head of Vneshtorgbank, said that the proposal from RZD may be attractive, especially if the economic situation gets worse. 
As a whole, the financiers are not commenting actively the proposal, which is understandable, since they prefer giving remarks based on more extensive information than that which is available now. Another group of potential partners for RZD in the project, private operators and representatives of freight owners, are also very cautious in their comments. Representative of Apparel, an operator specialising in the shipment of cars, said the idea behind the SFC is rather good, that participation in the company may be interesting for others rolling stock owners, but that there are some unclear issues. “We would like to know more details, on which everything depends. For example, how will we be able to take part in corporate governance? Will we be able to influence the management?” -- he asked.
Valery Andryushin, the head of VKM-Trans, believes that some companies may accept the proposal, particularly small market players in the first instance. “Medium-size and large operators will not come until the clear rules have been announced. If the controlling stake in the company is held by RZD, I think there will be not many private businesses willing to join up. But if the SFC is an independent player, it will be a different situation. The rail operators are now seeking ways to unite their efforts, a base that could help them coordinate their actions on the market. The SFC could be this uniting force,” he said. 
Mikhail Taran, the director general of Actor-Trans company says it would be better for the national economy to have as many specialized operators as possible: “After all, a great number of players knowing the ins and outs in their sectors,  helps lower transport costs within the economy.”

Resume 
According to RZD, when the SFC begins commercial activity and the transfer of its ownership of all freight cars has been completed, an IPO will be held, after taking into account the situation on the financial markets. The planned date is no earlier than 2011. The SFC is expected to begin commercial activity in the first quarter of 2010. 
The company will thus be capitalised as a result of these contributions on the part of Russian Railways and the other shareholders. The stakes owned by shareholders will represents liquid assets whose sale should ensure a return on the investment made when setting up the company. 
“Implementing this model will ensure the creation of comparably-sized businesses in the shape of the First and Second Freight Companies that will own and operate their own cars and enter into contracts with customers”, said RZD in a statement. 
Ivan Stupachenko 
    [~DETAIL_TEXT] => 
Equal Conditions for All Market Players 
The current structure of the rail transportation services market in Russia may be called operators-oriented, implying it creates an environment they can benefit from more even than RZD, the largest player in the guise of the wholly state-owned rail carrier. This paradox can be explained if we have a look at the distribution of obligations on both parties and today’s practice of tariff policy applied within the industry. 
While RZD is responsible for the shipment of all cargoes by set tariffs which cannot be changed without the decree of the RF Federal Tariff Service, private operators of rolling stock are free to choose attractive cargoes and lucrative routes. Moreover, they can reduce the price of their services by up to 15% or on the contrary make it higher than the price of RZD in return to more client-oriented services. 15% here is the size of a wagon constituent within the tariff, and all owners of rolling stock, except RZD, have a right to shift this constituent as they find it possible or profitable. Such flexibility in obligations and price policy enabled the operators to win attractive clients, get value-added cargoes and occupy interesting directions over the past few years, while RZD was forced to handle with one-wagon shipments and cheap cargoes, thus losing the competition. 
In an attempt to create equal conditions for all players, RZD offered a plan to reform the industry. Initially, according to the plan, first discussed in 2006, the idea was to set up an RZD freight subsidiary which would have the same rights and obligations as any other operator. The set-up was supposed to be made through transferring part of the rolling stock managed by RZD to this company. But the step was strongly opposed by both private companies and officials from the Ministry of Transport. The main objection was that the new player will be as strong as RZD itself but would be free from state supervision, and this situation could be dangerous for the current level of competition. Then RZD and the Ministry of Transport agreed to create two freight companies which could boost competition and at the same make it possible for RZD to compete with private operators on equal terms.  
The First Freight Company (FFC, or Freight One) started its operations in late 2007, and now the park of the operator numbers more than 200 000 cars of different types (see our Rating, page 26) which is about one third of the market total. 
“Any choice on developing the operation of rolling stock and restructuring RZD’s wagon fleet must take into account the need to ensure equal conditions on the freight cars market, as well as ensure uninterrupted traffic flows, especially for socially important goods. This in turn has to be based on the equal responsibility of all market players. 
The key challenge to be solved when reforming the system for the provision of freight cars is to increase the actual output of the freight car fleet. This assumes the implementation of all order volumes using the minimum number of wagons from the fleet with the maximum mileage per loaded car per annum,” said RZD’s press office in a statement after the company finalised its decision to set up the operator in late May this year.
RZD considers that at the same time as establishing the SFC, it is necessary to ensure the development of a regulatory framework, technological standards and rules for the effective functioning of the market in the new environment. Such initiatives will be sent to the RF Ministry of Transport and other relevant federal authorities to prepare agreed solutions. It is anticipated that improving the regulatory framework and rules will be completed by the time the SFC is founded. 
RZD will develop a business plan for the SFC based on the approved concept, which will then be considered by RZD’s board of directors.

Financiers Are Very Cautious 
The scheme for the creation of the SFC slightly differs from the one used for Freight One. RZD is signing over 217 000 wagons to the SFC, thus making it as strong as the FFC and encouraging competition between its two freight subsidiaries. (RZD itself will hold a few thousands of wagons used for incorporated shipments and in the future is going to be turned into an infrastructure company with stock in rail freight operators). The main difference is that the owners of rolling stock are being invited to become shareholders in the operator. All they have to do is give their wagons to the SFC in return for dividends and an opportunity to influence corporate governance. With private rolling stock,  the entire park of the SFC is predicted to reach 265 000 – 283 000 wagons in the next few years. The park of the Freight One in the future is estimated at 266 000 wagons. 
RZD President Vladimir Yakunin said that the forming of ownership capital and distribution of shares between would-be owners would be made according to a special methodology of assets valuation.  This methodology is still to be worked out, but it is already known that the rolling stock of private owners to be brought into the stock of the SFC will be valued in accordance with market prices. The same goes for RZD’s wagons that are to be transferred to the operator. In the first phase of the creation of the company, private owners can get up to 25%+1 share, in the future the private share could be significantly enlarged, to about half the capital.
The offer from RZD seems to be timed very well. The economic crisis seriously hit the rail shipment industry, and it happened just the years when private companies had been purchasing rolling stock very actively. Most of the wagons were being bought with the help of leasing schemes or borrowed money. Importantly, bank borrow rates in Russia are very high because of the high inflation rate which has not dropped to single digits, according to official data. The real inflation rate, say economists, might be even higher than the state statistics body says. 
The crisis closed paths to refinancing, which coupled with volumes shipped by rail was a factor contributing to threats to insolvency for many operators. Many leasing companies faced the problem of non-payment still in late 2008 and were forced to make the decision on what to do with their assets: give them payback from railway operators or giving their clients installments. The proposal from RZD promises to free the financiers, leasing companies and freight owners from the headache and prospects of getting into “red zone”, since idle of rolling stock nonetheless demands expenses for maintenance as well as paying taxes.

Business Seeks More Clarity 
This summer Vladimir Yakunin said RZD was in negotiations with national major banks including Vneshtorgbank and Sberbank as sources of funds to purchase rolling stock. There are also negotiations with the European Bank for Reconstruction and Development (EBRD). EBRD confirmed it had expressed an interest in the possible participation in the SFC. Andrey Kostin, the head of Vneshtorgbank, said that the proposal from RZD may be attractive, especially if the economic situation gets worse. 
As a whole, the financiers are not commenting actively the proposal, which is understandable, since they prefer giving remarks based on more extensive information than that which is available now. Another group of potential partners for RZD in the project, private operators and representatives of freight owners, are also very cautious in their comments. Representative of Apparel, an operator specialising in the shipment of cars, said the idea behind the SFC is rather good, that participation in the company may be interesting for others rolling stock owners, but that there are some unclear issues. “We would like to know more details, on which everything depends. For example, how will we be able to take part in corporate governance? Will we be able to influence the management?” -- he asked.
Valery Andryushin, the head of VKM-Trans, believes that some companies may accept the proposal, particularly small market players in the first instance. “Medium-size and large operators will not come until the clear rules have been announced. If the controlling stake in the company is held by RZD, I think there will be not many private businesses willing to join up. But if the SFC is an independent player, it will be a different situation. The rail operators are now seeking ways to unite their efforts, a base that could help them coordinate their actions on the market. The SFC could be this uniting force,” he said. 
Mikhail Taran, the director general of Actor-Trans company says it would be better for the national economy to have as many specialized operators as possible: “After all, a great number of players knowing the ins and outs in their sectors,  helps lower transport costs within the economy.”

Resume 
According to RZD, when the SFC begins commercial activity and the transfer of its ownership of all freight cars has been completed, an IPO will be held, after taking into account the situation on the financial markets. The planned date is no earlier than 2011. The SFC is expected to begin commercial activity in the first quarter of 2010. 
The company will thus be capitalised as a result of these contributions on the part of Russian Railways and the other shareholders. The stakes owned by shareholders will represents liquid assets whose sale should ensure a return on the investment made when setting up the company. 
“Implementing this model will ensure the creation of comparably-sized businesses in the shape of the First and Second Freight Companies that will own and operate their own cars and enter into contracts with customers”, said RZD in a statement. 
Ivan Stupachenko 
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    [DETAIL_TEXT] => 
Equal Conditions for All Market Players 
The current structure of the rail transportation services market in Russia may be called operators-oriented, implying it creates an environment they can benefit from more even than RZD, the largest player in the guise of the wholly state-owned rail carrier. This paradox can be explained if we have a look at the distribution of obligations on both parties and today’s practice of tariff policy applied within the industry. 
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In an attempt to create equal conditions for all players, RZD offered a plan to reform the industry. Initially, according to the plan, first discussed in 2006, the idea was to set up an RZD freight subsidiary which would have the same rights and obligations as any other operator. The set-up was supposed to be made through transferring part of the rolling stock managed by RZD to this company. But the step was strongly opposed by both private companies and officials from the Ministry of Transport. The main objection was that the new player will be as strong as RZD itself but would be free from state supervision, and this situation could be dangerous for the current level of competition. Then RZD and the Ministry of Transport agreed to create two freight companies which could boost competition and at the same make it possible for RZD to compete with private operators on equal terms.  
The First Freight Company (FFC, or Freight One) started its operations in late 2007, and now the park of the operator numbers more than 200 000 cars of different types (see our Rating, page 26) which is about one third of the market total. 
“Any choice on developing the operation of rolling stock and restructuring RZD’s wagon fleet must take into account the need to ensure equal conditions on the freight cars market, as well as ensure uninterrupted traffic flows, especially for socially important goods. This in turn has to be based on the equal responsibility of all market players. 
The key challenge to be solved when reforming the system for the provision of freight cars is to increase the actual output of the freight car fleet. This assumes the implementation of all order volumes using the minimum number of wagons from the fleet with the maximum mileage per loaded car per annum,” said RZD’s press office in a statement after the company finalised its decision to set up the operator in late May this year.
RZD considers that at the same time as establishing the SFC, it is necessary to ensure the development of a regulatory framework, technological standards and rules for the effective functioning of the market in the new environment. Such initiatives will be sent to the RF Ministry of Transport and other relevant federal authorities to prepare agreed solutions. It is anticipated that improving the regulatory framework and rules will be completed by the time the SFC is founded. 
RZD will develop a business plan for the SFC based on the approved concept, which will then be considered by RZD’s board of directors.

Financiers Are Very Cautious 
The scheme for the creation of the SFC slightly differs from the one used for Freight One. RZD is signing over 217 000 wagons to the SFC, thus making it as strong as the FFC and encouraging competition between its two freight subsidiaries. (RZD itself will hold a few thousands of wagons used for incorporated shipments and in the future is going to be turned into an infrastructure company with stock in rail freight operators). The main difference is that the owners of rolling stock are being invited to become shareholders in the operator. All they have to do is give their wagons to the SFC in return for dividends and an opportunity to influence corporate governance. With private rolling stock,  the entire park of the SFC is predicted to reach 265 000 – 283 000 wagons in the next few years. The park of the Freight One in the future is estimated at 266 000 wagons. 
RZD President Vladimir Yakunin said that the forming of ownership capital and distribution of shares between would-be owners would be made according to a special methodology of assets valuation.  This methodology is still to be worked out, but it is already known that the rolling stock of private owners to be brought into the stock of the SFC will be valued in accordance with market prices. The same goes for RZD’s wagons that are to be transferred to the operator. In the first phase of the creation of the company, private owners can get up to 25%+1 share, in the future the private share could be significantly enlarged, to about half the capital.
The offer from RZD seems to be timed very well. The economic crisis seriously hit the rail shipment industry, and it happened just the years when private companies had been purchasing rolling stock very actively. Most of the wagons were being bought with the help of leasing schemes or borrowed money. Importantly, bank borrow rates in Russia are very high because of the high inflation rate which has not dropped to single digits, according to official data. The real inflation rate, say economists, might be even higher than the state statistics body says. 
The crisis closed paths to refinancing, which coupled with volumes shipped by rail was a factor contributing to threats to insolvency for many operators. Many leasing companies faced the problem of non-payment still in late 2008 and were forced to make the decision on what to do with their assets: give them payback from railway operators or giving their clients installments. The proposal from RZD promises to free the financiers, leasing companies and freight owners from the headache and prospects of getting into “red zone”, since idle of rolling stock nonetheless demands expenses for maintenance as well as paying taxes.

Business Seeks More Clarity 
This summer Vladimir Yakunin said RZD was in negotiations with national major banks including Vneshtorgbank and Sberbank as sources of funds to purchase rolling stock. There are also negotiations with the European Bank for Reconstruction and Development (EBRD). EBRD confirmed it had expressed an interest in the possible participation in the SFC. Andrey Kostin, the head of Vneshtorgbank, said that the proposal from RZD may be attractive, especially if the economic situation gets worse. 
As a whole, the financiers are not commenting actively the proposal, which is understandable, since they prefer giving remarks based on more extensive information than that which is available now. Another group of potential partners for RZD in the project, private operators and representatives of freight owners, are also very cautious in their comments. Representative of Apparel, an operator specialising in the shipment of cars, said the idea behind the SFC is rather good, that participation in the company may be interesting for others rolling stock owners, but that there are some unclear issues. “We would like to know more details, on which everything depends. For example, how will we be able to take part in corporate governance? Will we be able to influence the management?” -- he asked.
Valery Andryushin, the head of VKM-Trans, believes that some companies may accept the proposal, particularly small market players in the first instance. “Medium-size and large operators will not come until the clear rules have been announced. If the controlling stake in the company is held by RZD, I think there will be not many private businesses willing to join up. But if the SFC is an independent player, it will be a different situation. The rail operators are now seeking ways to unite their efforts, a base that could help them coordinate their actions on the market. The SFC could be this uniting force,” he said. 
Mikhail Taran, the director general of Actor-Trans company says it would be better for the national economy to have as many specialized operators as possible: “After all, a great number of players knowing the ins and outs in their sectors,  helps lower transport costs within the economy.”

Resume 
According to RZD, when the SFC begins commercial activity and the transfer of its ownership of all freight cars has been completed, an IPO will be held, after taking into account the situation on the financial markets. The planned date is no earlier than 2011. The SFC is expected to begin commercial activity in the first quarter of 2010. 
The company will thus be capitalised as a result of these contributions on the part of Russian Railways and the other shareholders. The stakes owned by shareholders will represents liquid assets whose sale should ensure a return on the investment made when setting up the company. 
“Implementing this model will ensure the creation of comparably-sized businesses in the shape of the First and Second Freight Companies that will own and operate their own cars and enter into contracts with customers”, said RZD in a statement. 
Ivan Stupachenko 
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Equal Conditions for All Market Players 
The current structure of the rail transportation services market in Russia may be called operators-oriented, implying it creates an environment they can benefit from more even than RZD, the largest player in the guise of the wholly state-owned rail carrier. This paradox can be explained if we have a look at the distribution of obligations on both parties and today’s practice of tariff policy applied within the industry. 
While RZD is responsible for the shipment of all cargoes by set tariffs which cannot be changed without the decree of the RF Federal Tariff Service, private operators of rolling stock are free to choose attractive cargoes and lucrative routes. Moreover, they can reduce the price of their services by up to 15% or on the contrary make it higher than the price of RZD in return to more client-oriented services. 15% here is the size of a wagon constituent within the tariff, and all owners of rolling stock, except RZD, have a right to shift this constituent as they find it possible or profitable. Such flexibility in obligations and price policy enabled the operators to win attractive clients, get value-added cargoes and occupy interesting directions over the past few years, while RZD was forced to handle with one-wagon shipments and cheap cargoes, thus losing the competition. 
In an attempt to create equal conditions for all players, RZD offered a plan to reform the industry. Initially, according to the plan, first discussed in 2006, the idea was to set up an RZD freight subsidiary which would have the same rights and obligations as any other operator. The set-up was supposed to be made through transferring part of the rolling stock managed by RZD to this company. But the step was strongly opposed by both private companies and officials from the Ministry of Transport. The main objection was that the new player will be as strong as RZD itself but would be free from state supervision, and this situation could be dangerous for the current level of competition. Then RZD and the Ministry of Transport agreed to create two freight companies which could boost competition and at the same make it possible for RZD to compete with private operators on equal terms.  
The First Freight Company (FFC, or Freight One) started its operations in late 2007, and now the park of the operator numbers more than 200 000 cars of different types (see our Rating, page 26) which is about one third of the market total. 
“Any choice on developing the operation of rolling stock and restructuring RZD’s wagon fleet must take into account the need to ensure equal conditions on the freight cars market, as well as ensure uninterrupted traffic flows, especially for socially important goods. This in turn has to be based on the equal responsibility of all market players. 
The key challenge to be solved when reforming the system for the provision of freight cars is to increase the actual output of the freight car fleet. This assumes the implementation of all order volumes using the minimum number of wagons from the fleet with the maximum mileage per loaded car per annum,” said RZD’s press office in a statement after the company finalised its decision to set up the operator in late May this year.
RZD considers that at the same time as establishing the SFC, it is necessary to ensure the development of a regulatory framework, technological standards and rules for the effective functioning of the market in the new environment. Such initiatives will be sent to the RF Ministry of Transport and other relevant federal authorities to prepare agreed solutions. It is anticipated that improving the regulatory framework and rules will be completed by the time the SFC is founded. 
RZD will develop a business plan for the SFC based on the approved concept, which will then be considered by RZD’s board of directors.

Financiers Are Very Cautious 
The scheme for the creation of the SFC slightly differs from the one used for Freight One. RZD is signing over 217 000 wagons to the SFC, thus making it as strong as the FFC and encouraging competition between its two freight subsidiaries. (RZD itself will hold a few thousands of wagons used for incorporated shipments and in the future is going to be turned into an infrastructure company with stock in rail freight operators). The main difference is that the owners of rolling stock are being invited to become shareholders in the operator. All they have to do is give their wagons to the SFC in return for dividends and an opportunity to influence corporate governance. With private rolling stock,  the entire park of the SFC is predicted to reach 265 000 – 283 000 wagons in the next few years. The park of the Freight One in the future is estimated at 266 000 wagons. 
RZD President Vladimir Yakunin said that the forming of ownership capital and distribution of shares between would-be owners would be made according to a special methodology of assets valuation.  This methodology is still to be worked out, but it is already known that the rolling stock of private owners to be brought into the stock of the SFC will be valued in accordance with market prices. The same goes for RZD’s wagons that are to be transferred to the operator. In the first phase of the creation of the company, private owners can get up to 25%+1 share, in the future the private share could be significantly enlarged, to about half the capital.
The offer from RZD seems to be timed very well. The economic crisis seriously hit the rail shipment industry, and it happened just the years when private companies had been purchasing rolling stock very actively. Most of the wagons were being bought with the help of leasing schemes or borrowed money. Importantly, bank borrow rates in Russia are very high because of the high inflation rate which has not dropped to single digits, according to official data. The real inflation rate, say economists, might be even higher than the state statistics body says. 
The crisis closed paths to refinancing, which coupled with volumes shipped by rail was a factor contributing to threats to insolvency for many operators. Many leasing companies faced the problem of non-payment still in late 2008 and were forced to make the decision on what to do with their assets: give them payback from railway operators or giving their clients installments. The proposal from RZD promises to free the financiers, leasing companies and freight owners from the headache and prospects of getting into “red zone”, since idle of rolling stock nonetheless demands expenses for maintenance as well as paying taxes.

Business Seeks More Clarity 
This summer Vladimir Yakunin said RZD was in negotiations with national major banks including Vneshtorgbank and Sberbank as sources of funds to purchase rolling stock. There are also negotiations with the European Bank for Reconstruction and Development (EBRD). EBRD confirmed it had expressed an interest in the possible participation in the SFC. Andrey Kostin, the head of Vneshtorgbank, said that the proposal from RZD may be attractive, especially if the economic situation gets worse. 
As a whole, the financiers are not commenting actively the proposal, which is understandable, since they prefer giving remarks based on more extensive information than that which is available now. Another group of potential partners for RZD in the project, private operators and representatives of freight owners, are also very cautious in their comments. Representative of Apparel, an operator specialising in the shipment of cars, said the idea behind the SFC is rather good, that participation in the company may be interesting for others rolling stock owners, but that there are some unclear issues. “We would like to know more details, on which everything depends. For example, how will we be able to take part in corporate governance? Will we be able to influence the management?” -- he asked.
Valery Andryushin, the head of VKM-Trans, believes that some companies may accept the proposal, particularly small market players in the first instance. “Medium-size and large operators will not come until the clear rules have been announced. If the controlling stake in the company is held by RZD, I think there will be not many private businesses willing to join up. But if the SFC is an independent player, it will be a different situation. The rail operators are now seeking ways to unite their efforts, a base that could help them coordinate their actions on the market. The SFC could be this uniting force,” he said. 
Mikhail Taran, the director general of Actor-Trans company says it would be better for the national economy to have as many specialized operators as possible: “After all, a great number of players knowing the ins and outs in their sectors,  helps lower transport costs within the economy.”

Resume 
According to RZD, when the SFC begins commercial activity and the transfer of its ownership of all freight cars has been completed, an IPO will be held, after taking into account the situation on the financial markets. The planned date is no earlier than 2011. The SFC is expected to begin commercial activity in the first quarter of 2010. 
The company will thus be capitalised as a result of these contributions on the part of Russian Railways and the other shareholders. The stakes owned by shareholders will represents liquid assets whose sale should ensure a return on the investment made when setting up the company. 
“Implementing this model will ensure the creation of comparably-sized businesses in the shape of the First and Second Freight Companies that will own and operate their own cars and enter into contracts with customers”, said RZD in a statement. 
Ivan Stupachenko 
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The First Journey of Sapsan 
On July 30, Russian Railways’ high-speed train Sapsan completed its first demonstration journey on the route Moscow - St. Petersburg. The train built by specialists of German concern Siemens specially for Russian railways and tested at the experimental ring-railway in Scherbinka (Moscow suburb) left Leningradsky railway station (Moscow) at 07.20 a.m.
“Sapsan becomes the symbol of everything new, progressive. This train changes the image of national railway transport as well as represents the reasonable, vitally necessary approach to development, in which breakthrough technologies are most important”, emphasised Vladimir Yakunin, President of OAO RZD.
The train travelled along the route at speeds ranging from 160 to 250 kph. 
The launch of the Sapsan train will bring the journey time from Moscow St. Petersburg down to 3 hours 45 minutes. Currently the fastest train travel time is 4 hours 30 minutes. 
“80% loading of a train is considered a very good result. We think that Sapsan will be loaded by 100%, because it is comfortable, reliable, and fast,” said Mr Yakunin. 
The commercial exploitation of the first train of this type is to start in December 2009. The rest seven Velaro RUS trains are to be delivered and put into operation in 2010.
The contract on construction of 8 Velaro RUS trains was concluded by OAO RZD and Siemens Transportation Systems in May 2006. The cost of the contract is EUR 276 mln. In April 2007, the parties concluded a contract on technical service for the trains. Its cost is EUR 354.1 mln. The term of the contract is 30 years. Over 150 unique Russian elaborations were used to construct the train.
RZD president Vladimir Yakunin said: “The involvement of Russian scientists and specialists in the Sapsan production project provides a good impetus to the introduction of cutting-edge innovation technology to Russian industry.”

EBRD gives Russian Railways USD 500 million loan  
On July 27, Russian Railways received a USD 500 million loan from the European Bank for Reconstruction and Development (EBRD). RZD and the EBRD signed an agreement on 15 July 2009 on the provision USD 500 million in credit, with a term of 10 years and a grace period of 1.5 years, at a floating rate of around 4% per annum. 
Commenting on the deal, RZD President Vladimir Yakunin said: “We view the provision of this credit as part of the implementation of the EBRD’s policy of taking part in major Russian projects, aiding the integration of Russia into the European community and of RZD into the global transport system. It also shows that the reforms being carried out at RZD are heading in the right direction, and have the support of the international community.” 
EBRD President Thomas Mirow said: “Our involvement in this project has given the EBRD a unique opportunity to provide real support to the rail sector reforms being carried out by RZD and the Russian government. We wholly support the readiness of RZD to fulfill, despite the economic crisis, its obligations in improving regulatory mechanisms and creating legal and economic conditions for the liberalisation of the rail transport services market.” 
The credit will be used by the company to optimise its debt structure.

Russian Government Votes “For”	
The RF Government approved the offer on Russia’s joining the Convention concerning International Carriage by Rail (COTIF).
Also, it decided to move the draft federal law “On the RF Joining the Convention concerning International Carriage by Rail (COTIF) of May 9, 1980 in the version of the Protocol of Modification of 3 June 1999” to the State Duma.
Russia’s joining COTIF will allow to use a single transport document (CIM consignment note) for freight transportation via railway-ferry lines Baltiysk – Sassnitz/Mukran (Germany) and Ust-Luga – Sassnitz/Mukran (Germany) and to other European ports. This document will be used at both sectors of the routes – sea and railway ones.

RZD receives 50% stake in Ulan-Bator Railways as trust manager
Russia’s President Dmitry Medvedev signed a decree “On the transfer of federally-owned shares in JSC Ulan-Bator Railways to the trust management of Russian Railways.”
As stated in the signed document, 50% of shares owned by Russia in Ulan-Bator Railways are being transferred to the trust management of Russian Railways for five years. 
“In fact, Russian Railways has already started to participate in the development of Ulan-Bator Railways and is giving practical assistance in carrying out major track repairs, upgrading rolling stock and improving transport technology,” said Vladimir Yakunin, President of Russian Railways.
According to Mr Yakunin, the implementation of the “Concept for Implementing the joint Russia-Mongolian Development Project for JSC Ulan-Bator Railways and the Construction of New Rail Infrastructure in Mongolia, which was developed by Russian Railways experts, will enhance the efficiency of Mongolia’s domestic rail transport and its transit shipments. 
The Joint Stock Company Ulan-Bator Railways was founded in 1949 as a result of an agreement between the governments of the USSR and the Mongolian People’s Republic, with each side holding equal amounts in the company’s share capital. Prior to this new agreement, Russia’s Federal Agency of Rail Transport exercised the Russian government’s powers as shareholder.

Belcomur Project Approved	
The Investment Committee at the Ministry of Regional Development approved the project of Belcomur railway construction (the White Sea – Komi - Urals).
The new railway will connect the Republic of Komi, Perm and Arkhangelsk regions. Later the line will become a part of the Northern transport corridor to connect Russia and European countries.
The total length of Belcomur will be 1252 km.
A special governmental committee is to make the final decision on the railway construction in September 2009.
    [~DETAIL_TEXT] => 
The First Journey of Sapsan 
On July 30, Russian Railways’ high-speed train Sapsan completed its first demonstration journey on the route Moscow - St. Petersburg. The train built by specialists of German concern Siemens specially for Russian railways and tested at the experimental ring-railway in Scherbinka (Moscow suburb) left Leningradsky railway station (Moscow) at 07.20 a.m.
“Sapsan becomes the symbol of everything new, progressive. This train changes the image of national railway transport as well as represents the reasonable, vitally necessary approach to development, in which breakthrough technologies are most important”, emphasised Vladimir Yakunin, President of OAO RZD.
The train travelled along the route at speeds ranging from 160 to 250 kph. 
The launch of the Sapsan train will bring the journey time from Moscow St. Petersburg down to 3 hours 45 minutes. Currently the fastest train travel time is 4 hours 30 minutes. 
“80% loading of a train is considered a very good result. We think that Sapsan will be loaded by 100%, because it is comfortable, reliable, and fast,” said Mr Yakunin. 
The commercial exploitation of the first train of this type is to start in December 2009. The rest seven Velaro RUS trains are to be delivered and put into operation in 2010.
The contract on construction of 8 Velaro RUS trains was concluded by OAO RZD and Siemens Transportation Systems in May 2006. The cost of the contract is EUR 276 mln. In April 2007, the parties concluded a contract on technical service for the trains. Its cost is EUR 354.1 mln. The term of the contract is 30 years. Over 150 unique Russian elaborations were used to construct the train.
RZD president Vladimir Yakunin said: “The involvement of Russian scientists and specialists in the Sapsan production project provides a good impetus to the introduction of cutting-edge innovation technology to Russian industry.”

EBRD gives Russian Railways USD 500 million loan  
On July 27, Russian Railways received a USD 500 million loan from the European Bank for Reconstruction and Development (EBRD). RZD and the EBRD signed an agreement on 15 July 2009 on the provision USD 500 million in credit, with a term of 10 years and a grace period of 1.5 years, at a floating rate of around 4% per annum. 
Commenting on the deal, RZD President Vladimir Yakunin said: “We view the provision of this credit as part of the implementation of the EBRD’s policy of taking part in major Russian projects, aiding the integration of Russia into the European community and of RZD into the global transport system. It also shows that the reforms being carried out at RZD are heading in the right direction, and have the support of the international community.” 
EBRD President Thomas Mirow said: “Our involvement in this project has given the EBRD a unique opportunity to provide real support to the rail sector reforms being carried out by RZD and the Russian government. We wholly support the readiness of RZD to fulfill, despite the economic crisis, its obligations in improving regulatory mechanisms and creating legal and economic conditions for the liberalisation of the rail transport services market.” 
The credit will be used by the company to optimise its debt structure.

Russian Government Votes “For”	
The RF Government approved the offer on Russia’s joining the Convention concerning International Carriage by Rail (COTIF).
Also, it decided to move the draft federal law “On the RF Joining the Convention concerning International Carriage by Rail (COTIF) of May 9, 1980 in the version of the Protocol of Modification of 3 June 1999” to the State Duma.
Russia’s joining COTIF will allow to use a single transport document (CIM consignment note) for freight transportation via railway-ferry lines Baltiysk – Sassnitz/Mukran (Germany) and Ust-Luga – Sassnitz/Mukran (Germany) and to other European ports. This document will be used at both sectors of the routes – sea and railway ones.

RZD receives 50% stake in Ulan-Bator Railways as trust manager
Russia’s President Dmitry Medvedev signed a decree “On the transfer of federally-owned shares in JSC Ulan-Bator Railways to the trust management of Russian Railways.”
As stated in the signed document, 50% of shares owned by Russia in Ulan-Bator Railways are being transferred to the trust management of Russian Railways for five years. 
“In fact, Russian Railways has already started to participate in the development of Ulan-Bator Railways and is giving practical assistance in carrying out major track repairs, upgrading rolling stock and improving transport technology,” said Vladimir Yakunin, President of Russian Railways.
According to Mr Yakunin, the implementation of the “Concept for Implementing the joint Russia-Mongolian Development Project for JSC Ulan-Bator Railways and the Construction of New Rail Infrastructure in Mongolia, which was developed by Russian Railways experts, will enhance the efficiency of Mongolia’s domestic rail transport and its transit shipments. 
The Joint Stock Company Ulan-Bator Railways was founded in 1949 as a result of an agreement between the governments of the USSR and the Mongolian People’s Republic, with each side holding equal amounts in the company’s share capital. Prior to this new agreement, Russia’s Federal Agency of Rail Transport exercised the Russian government’s powers as shareholder.

Belcomur Project Approved	
The Investment Committee at the Ministry of Regional Development approved the project of Belcomur railway construction (the White Sea – Komi - Urals).
The new railway will connect the Republic of Komi, Perm and Arkhangelsk regions. Later the line will become a part of the Northern transport corridor to connect Russia and European countries.
The total length of Belcomur will be 1252 km.
A special governmental committee is to make the final decision on the railway construction in September 2009.
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    [DETAIL_TEXT] => 
The First Journey of Sapsan 
On July 30, Russian Railways’ high-speed train Sapsan completed its first demonstration journey on the route Moscow - St. Petersburg. The train built by specialists of German concern Siemens specially for Russian railways and tested at the experimental ring-railway in Scherbinka (Moscow suburb) left Leningradsky railway station (Moscow) at 07.20 a.m.
“Sapsan becomes the symbol of everything new, progressive. This train changes the image of national railway transport as well as represents the reasonable, vitally necessary approach to development, in which breakthrough technologies are most important”, emphasised Vladimir Yakunin, President of OAO RZD.
The train travelled along the route at speeds ranging from 160 to 250 kph. 
The launch of the Sapsan train will bring the journey time from Moscow St. Petersburg down to 3 hours 45 minutes. Currently the fastest train travel time is 4 hours 30 minutes. 
“80% loading of a train is considered a very good result. We think that Sapsan will be loaded by 100%, because it is comfortable, reliable, and fast,” said Mr Yakunin. 
The commercial exploitation of the first train of this type is to start in December 2009. The rest seven Velaro RUS trains are to be delivered and put into operation in 2010.
The contract on construction of 8 Velaro RUS trains was concluded by OAO RZD and Siemens Transportation Systems in May 2006. The cost of the contract is EUR 276 mln. In April 2007, the parties concluded a contract on technical service for the trains. Its cost is EUR 354.1 mln. The term of the contract is 30 years. Over 150 unique Russian elaborations were used to construct the train.
RZD president Vladimir Yakunin said: “The involvement of Russian scientists and specialists in the Sapsan production project provides a good impetus to the introduction of cutting-edge innovation technology to Russian industry.”

EBRD gives Russian Railways USD 500 million loan  
On July 27, Russian Railways received a USD 500 million loan from the European Bank for Reconstruction and Development (EBRD). RZD and the EBRD signed an agreement on 15 July 2009 on the provision USD 500 million in credit, with a term of 10 years and a grace period of 1.5 years, at a floating rate of around 4% per annum. 
Commenting on the deal, RZD President Vladimir Yakunin said: “We view the provision of this credit as part of the implementation of the EBRD’s policy of taking part in major Russian projects, aiding the integration of Russia into the European community and of RZD into the global transport system. It also shows that the reforms being carried out at RZD are heading in the right direction, and have the support of the international community.” 
EBRD President Thomas Mirow said: “Our involvement in this project has given the EBRD a unique opportunity to provide real support to the rail sector reforms being carried out by RZD and the Russian government. We wholly support the readiness of RZD to fulfill, despite the economic crisis, its obligations in improving regulatory mechanisms and creating legal and economic conditions for the liberalisation of the rail transport services market.” 
The credit will be used by the company to optimise its debt structure.

Russian Government Votes “For”	
The RF Government approved the offer on Russia’s joining the Convention concerning International Carriage by Rail (COTIF).
Also, it decided to move the draft federal law “On the RF Joining the Convention concerning International Carriage by Rail (COTIF) of May 9, 1980 in the version of the Protocol of Modification of 3 June 1999” to the State Duma.
Russia’s joining COTIF will allow to use a single transport document (CIM consignment note) for freight transportation via railway-ferry lines Baltiysk – Sassnitz/Mukran (Germany) and Ust-Luga – Sassnitz/Mukran (Germany) and to other European ports. This document will be used at both sectors of the routes – sea and railway ones.

RZD receives 50% stake in Ulan-Bator Railways as trust manager
Russia’s President Dmitry Medvedev signed a decree “On the transfer of federally-owned shares in JSC Ulan-Bator Railways to the trust management of Russian Railways.”
As stated in the signed document, 50% of shares owned by Russia in Ulan-Bator Railways are being transferred to the trust management of Russian Railways for five years. 
“In fact, Russian Railways has already started to participate in the development of Ulan-Bator Railways and is giving practical assistance in carrying out major track repairs, upgrading rolling stock and improving transport technology,” said Vladimir Yakunin, President of Russian Railways.
According to Mr Yakunin, the implementation of the “Concept for Implementing the joint Russia-Mongolian Development Project for JSC Ulan-Bator Railways and the Construction of New Rail Infrastructure in Mongolia, which was developed by Russian Railways experts, will enhance the efficiency of Mongolia’s domestic rail transport and its transit shipments. 
The Joint Stock Company Ulan-Bator Railways was founded in 1949 as a result of an agreement between the governments of the USSR and the Mongolian People’s Republic, with each side holding equal amounts in the company’s share capital. Prior to this new agreement, Russia’s Federal Agency of Rail Transport exercised the Russian government’s powers as shareholder.

Belcomur Project Approved	
The Investment Committee at the Ministry of Regional Development approved the project of Belcomur railway construction (the White Sea – Komi - Urals).
The new railway will connect the Republic of Komi, Perm and Arkhangelsk regions. Later the line will become a part of the Northern transport corridor to connect Russia and European countries.
The total length of Belcomur will be 1252 km.
A special governmental committee is to make the final decision on the railway construction in September 2009.
    [~DETAIL_TEXT] => 
The First Journey of Sapsan 
On July 30, Russian Railways’ high-speed train Sapsan completed its first demonstration journey on the route Moscow - St. Petersburg. The train built by specialists of German concern Siemens specially for Russian railways and tested at the experimental ring-railway in Scherbinka (Moscow suburb) left Leningradsky railway station (Moscow) at 07.20 a.m.
“Sapsan becomes the symbol of everything new, progressive. This train changes the image of national railway transport as well as represents the reasonable, vitally necessary approach to development, in which breakthrough technologies are most important”, emphasised Vladimir Yakunin, President of OAO RZD.
The train travelled along the route at speeds ranging from 160 to 250 kph. 
The launch of the Sapsan train will bring the journey time from Moscow St. Petersburg down to 3 hours 45 minutes. Currently the fastest train travel time is 4 hours 30 minutes. 
“80% loading of a train is considered a very good result. We think that Sapsan will be loaded by 100%, because it is comfortable, reliable, and fast,” said Mr Yakunin. 
The commercial exploitation of the first train of this type is to start in December 2009. The rest seven Velaro RUS trains are to be delivered and put into operation in 2010.
The contract on construction of 8 Velaro RUS trains was concluded by OAO RZD and Siemens Transportation Systems in May 2006. The cost of the contract is EUR 276 mln. In April 2007, the parties concluded a contract on technical service for the trains. Its cost is EUR 354.1 mln. The term of the contract is 30 years. Over 150 unique Russian elaborations were used to construct the train.
RZD president Vladimir Yakunin said: “The involvement of Russian scientists and specialists in the Sapsan production project provides a good impetus to the introduction of cutting-edge innovation technology to Russian industry.”

EBRD gives Russian Railways USD 500 million loan  
On July 27, Russian Railways received a USD 500 million loan from the European Bank for Reconstruction and Development (EBRD). RZD and the EBRD signed an agreement on 15 July 2009 on the provision USD 500 million in credit, with a term of 10 years and a grace period of 1.5 years, at a floating rate of around 4% per annum. 
Commenting on the deal, RZD President Vladimir Yakunin said: “We view the provision of this credit as part of the implementation of the EBRD’s policy of taking part in major Russian projects, aiding the integration of Russia into the European community and of RZD into the global transport system. It also shows that the reforms being carried out at RZD are heading in the right direction, and have the support of the international community.” 
EBRD President Thomas Mirow said: “Our involvement in this project has given the EBRD a unique opportunity to provide real support to the rail sector reforms being carried out by RZD and the Russian government. We wholly support the readiness of RZD to fulfill, despite the economic crisis, its obligations in improving regulatory mechanisms and creating legal and economic conditions for the liberalisation of the rail transport services market.” 
The credit will be used by the company to optimise its debt structure.

Russian Government Votes “For”	
The RF Government approved the offer on Russia’s joining the Convention concerning International Carriage by Rail (COTIF).
Also, it decided to move the draft federal law “On the RF Joining the Convention concerning International Carriage by Rail (COTIF) of May 9, 1980 in the version of the Protocol of Modification of 3 June 1999” to the State Duma.
Russia’s joining COTIF will allow to use a single transport document (CIM consignment note) for freight transportation via railway-ferry lines Baltiysk – Sassnitz/Mukran (Germany) and Ust-Luga – Sassnitz/Mukran (Germany) and to other European ports. This document will be used at both sectors of the routes – sea and railway ones.

RZD receives 50% stake in Ulan-Bator Railways as trust manager
Russia’s President Dmitry Medvedev signed a decree “On the transfer of federally-owned shares in JSC Ulan-Bator Railways to the trust management of Russian Railways.”
As stated in the signed document, 50% of shares owned by Russia in Ulan-Bator Railways are being transferred to the trust management of Russian Railways for five years. 
“In fact, Russian Railways has already started to participate in the development of Ulan-Bator Railways and is giving practical assistance in carrying out major track repairs, upgrading rolling stock and improving transport technology,” said Vladimir Yakunin, President of Russian Railways.
According to Mr Yakunin, the implementation of the “Concept for Implementing the joint Russia-Mongolian Development Project for JSC Ulan-Bator Railways and the Construction of New Rail Infrastructure in Mongolia, which was developed by Russian Railways experts, will enhance the efficiency of Mongolia’s domestic rail transport and its transit shipments. 
The Joint Stock Company Ulan-Bator Railways was founded in 1949 as a result of an agreement between the governments of the USSR and the Mongolian People’s Republic, with each side holding equal amounts in the company’s share capital. Prior to this new agreement, Russia’s Federal Agency of Rail Transport exercised the Russian government’s powers as shareholder.

Belcomur Project Approved	
The Investment Committee at the Ministry of Regional Development approved the project of Belcomur railway construction (the White Sea – Komi - Urals).
The new railway will connect the Republic of Komi, Perm and Arkhangelsk regions. Later the line will become a part of the Northern transport corridor to connect Russia and European countries.
The total length of Belcomur will be 1252 km.
A special governmental committee is to make the final decision on the railway construction in September 2009.
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Russia - Finland: Cooperation To Be Accelerated 
According to the Finnish Customs Service, the share of Russian imports and exports in Finnish foreign trade turnover is between 11 and 16%. This means that Russia is the main economic partner of Finland and this is naturally generating active cooperation within the two counties’ business circles. And when you add the extensive program of cultural and educational cooperation, it becomes clear how necessary a modern passenger link between the two countries is. 
Currently, two passenger trains ply the route between St. Petersburg and Helsinki - the Russian fast train “Repin” and the Finnish fast train “Sibelius” run every day. The capital of Finland can also be reached from Moscow - the train “Lev Tolstoy” departs from the Russian capital’s Leningradski Station every evening. It takes six hours to get to St. Petersburg from Helsinki (just over 400 km) and a little more than 12 hours is needed to reach Moscow (about 1,000 km). More than 200,000 passengers cross the Russian-Finnish border by rail every year. 
In 2010 it is planned to start a direct high-speed service between St. Petersburg and Helsinki (the journey time will be about 
3 ½ hours). It became possible to reduce the time needed for trains to cover the distance in this direction because of the modernisation of the infrastructure, use of high-speed rolling stock and also the streamlining of border and customs formalities. RZD’s forecasts for maximum passenger traffic by high-speed trains are 500,000 people, including (as both Russian and Finnish railwaymen estimate) 100,000 -120,000 passengers attracted from other types of transport, because at the moment Russians (especially those living in St. Petersburg and adjoining regions) prefer to go to Finland via motorway.
We would like to remind readers that there is still no experience in Russia of high-speed movement. The first high-speed trains are planned to start between St. Petersburg and Moscow in the autumn of 2009. The route to Finland will be the second high-speed service experience for Russian railwaymen. At what stage is the project now? 

Allegro is not a mode, it is a train 
The President of RZD Vladimir Yakunin and the Chairman of VR Ltd Henry Kuitunen signed an agreement about the joint-stock company Oy Karelian Trains Ltd on November 23, 2006, in Helsinki, in the presence of the President of Russia Vladimir Putin and the President of Finland Tarja Halonen. This enterprise has been entrusted with the right to acquire specialised trains and to organise maintenance services for them. The results of the international tender to purchase the rolling stock for the organisation of this link became known in June 2007. French company Alstom won the competition. In 2009, Alstom Transport will supply its Pendollino trains for the Russian-Finnish railroad. 
Eighteen similar trains are already in operation in Finland but those meant for use on the Russian-Finnish international link have been modernised. Thus, they have been adapted to the Russian electricity supply system. The maximum speed of such trains will be 220km per hour. Seven carriages will be able to take 352 passengers. At the beginning of 2009 the first train was brought in and it is currently being tested.

Infrastructure questions
Apart from the purchase of new rolling stock, the project speeding up the communication between St. Petersburg and Helsinki involves investment in the Finnish and Russian railway infrastructure.
So, in Finland, reconstruction of the infrastructure on the sector from Lahti to Luumaki is being carried out now. It should be finished by the end of 2010 and this will allow the speed of trains running in this sector to be increased up to 200 km per hour. The cost of the reconstruction will be €185 million. We would like to remind readers that in some areas of Finland the trains will reach a speed of 220km per hour. 
Modernisation of the infrastructure is also taking place on the Russian side of the border. Budget costs for this project are RUR 79.7 billion (€634 million). This project will be partly financed from the Investment Fund of the Russian Federation. The Senior Vice-President of  RZD, Valentin Gapanovich, said that, with state support given during the period 2008-2010, this project will pay for itself, both to RZD and to the state budget of the Russian Federation, in 10 years.
Reconstruction of the rail and overhead contact system is being carried out on the Russian side of the route. Overhead line equipment and 250km of track is planned to be re-laid along the whole length of the line; three overpasses will be built to avoid crossing motorways; and new footbridges will be built too. 
However, the modernisation of the Russian high-speed railroad sector is drawing protests from the public. In order to organise effective high-speed railways, it is necessary to construct additional tracks for cargo trains, and it is planned to make this additional branch pass through the town of Vyborg. Such future plans for additional freight traffic to go through the town have caused a public outcry, despite the fact that it is proposed that they will move exclusively through industrial zones. 
The conflict between regional authorities and RZD started at the end of 2007 when the mayor of the town declared that such construction should not be allowed, and this declaration was supported by other regional authorities. RZD said that the compensation sought by local people was unrealistic. Meanwhile, Vyborg is currently a large cargo port in Russia’s Northwest, and the question of cargo exports through it is quite controversial. Recently, our magazine learnt from RZD that this problem remains unresolved. “Currently it is being considered during joint talks between the head authorities of Vyborg, the Vyborg area and Oktyabrskaya Railway, customer representatives and the project institute,” said Valentin Gapanovich. 

Not to be stuck at the customs
Among the main problems necessary to be solved before the line starts working is the organisation of customs inspections. It can take a few hours for 350 people to go through the necessary customs procedures but a high-speed train does not have this time to spare.
A few variants of customs control procedures have been considered. One is to organise customs registration along the principles of air transport - at the point of departure and at the destination point. But Jarko Saks, Director of Foreign Trade Department at the Customs Management of Finland, said that registration on moving trains seems to be the best choice. Probably, the train will make two short stops on its way so that the customs service staff can get on and off. The question remains of how to organise the return of the passengers not allowed to pass through the border (if such cases occur).

What are the prospects? 
In 2002-2003, when the plans to build the high-speed link were announced, there were discussions on how communications between Helsinki and Moscow (where the majority of Russian companies have their central offices) would be organised. These discussions seem especially advanced because, as has already been mentioned, by the end of 2009 it is planned to start a high-speed service between St. Petersburg and Moscow. 
But the idea of creating a “through service” to the Russian capital has sparked scepticism among Finnish experts. In their view, the through train to Moscow will not be able to compete with air transport, firstly because of the time the journey will take, even when the necessary airport procedures are included. This opinion has been proved: in Russia it is planned to start the high-speed service between St. Petersburg and Moscow by the end of this year and the train will cover the route in 3 ¾ hours. Adding another 3.5 hours for the journey to Helsinki it becomes more than 7 hours. By comparison, it takes 1 hour 20 minutes for planes to cover the distance between these two cities. And in any case, there is the opportunity to change from one high-speed train to another in St. Petersburg. 
Anna Nezhinskaya 

our reference
Currently train fares on the route St. Petersburg – Helsinki are 1st class – 89.1 Euros and 2nd class – 50.8 Euros.
The high-speed train Allegro fares are planned to be: 1st class - 110 Euros and 2nd class – 69.4 Euros. Train capacity is 350 passengers.
    [~DETAIL_TEXT] => 
Russia - Finland: Cooperation To Be Accelerated 
According to the Finnish Customs Service, the share of Russian imports and exports in Finnish foreign trade turnover is between 11 and 16%. This means that Russia is the main economic partner of Finland and this is naturally generating active cooperation within the two counties’ business circles. And when you add the extensive program of cultural and educational cooperation, it becomes clear how necessary a modern passenger link between the two countries is. 
Currently, two passenger trains ply the route between St. Petersburg and Helsinki - the Russian fast train “Repin” and the Finnish fast train “Sibelius” run every day. The capital of Finland can also be reached from Moscow - the train “Lev Tolstoy” departs from the Russian capital’s Leningradski Station every evening. It takes six hours to get to St. Petersburg from Helsinki (just over 400 km) and a little more than 12 hours is needed to reach Moscow (about 1,000 km). More than 200,000 passengers cross the Russian-Finnish border by rail every year. 
In 2010 it is planned to start a direct high-speed service between St. Petersburg and Helsinki (the journey time will be about 
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We would like to remind readers that there is still no experience in Russia of high-speed movement. The first high-speed trains are planned to start between St. Petersburg and Moscow in the autumn of 2009. The route to Finland will be the second high-speed service experience for Russian railwaymen. At what stage is the project now? 

Allegro is not a mode, it is a train 
The President of RZD Vladimir Yakunin and the Chairman of VR Ltd Henry Kuitunen signed an agreement about the joint-stock company Oy Karelian Trains Ltd on November 23, 2006, in Helsinki, in the presence of the President of Russia Vladimir Putin and the President of Finland Tarja Halonen. This enterprise has been entrusted with the right to acquire specialised trains and to organise maintenance services for them. The results of the international tender to purchase the rolling stock for the organisation of this link became known in June 2007. French company Alstom won the competition. In 2009, Alstom Transport will supply its Pendollino trains for the Russian-Finnish railroad. 
Eighteen similar trains are already in operation in Finland but those meant for use on the Russian-Finnish international link have been modernised. Thus, they have been adapted to the Russian electricity supply system. The maximum speed of such trains will be 220km per hour. Seven carriages will be able to take 352 passengers. At the beginning of 2009 the first train was brought in and it is currently being tested.

Infrastructure questions
Apart from the purchase of new rolling stock, the project speeding up the communication between St. Petersburg and Helsinki involves investment in the Finnish and Russian railway infrastructure.
So, in Finland, reconstruction of the infrastructure on the sector from Lahti to Luumaki is being carried out now. It should be finished by the end of 2010 and this will allow the speed of trains running in this sector to be increased up to 200 km per hour. The cost of the reconstruction will be €185 million. We would like to remind readers that in some areas of Finland the trains will reach a speed of 220km per hour. 
Modernisation of the infrastructure is also taking place on the Russian side of the border. Budget costs for this project are RUR 79.7 billion (€634 million). This project will be partly financed from the Investment Fund of the Russian Federation. The Senior Vice-President of  RZD, Valentin Gapanovich, said that, with state support given during the period 2008-2010, this project will pay for itself, both to RZD and to the state budget of the Russian Federation, in 10 years.
Reconstruction of the rail and overhead contact system is being carried out on the Russian side of the route. Overhead line equipment and 250km of track is planned to be re-laid along the whole length of the line; three overpasses will be built to avoid crossing motorways; and new footbridges will be built too. 
However, the modernisation of the Russian high-speed railroad sector is drawing protests from the public. In order to organise effective high-speed railways, it is necessary to construct additional tracks for cargo trains, and it is planned to make this additional branch pass through the town of Vyborg. Such future plans for additional freight traffic to go through the town have caused a public outcry, despite the fact that it is proposed that they will move exclusively through industrial zones. 
The conflict between regional authorities and RZD started at the end of 2007 when the mayor of the town declared that such construction should not be allowed, and this declaration was supported by other regional authorities. RZD said that the compensation sought by local people was unrealistic. Meanwhile, Vyborg is currently a large cargo port in Russia’s Northwest, and the question of cargo exports through it is quite controversial. Recently, our magazine learnt from RZD that this problem remains unresolved. “Currently it is being considered during joint talks between the head authorities of Vyborg, the Vyborg area and Oktyabrskaya Railway, customer representatives and the project institute,” said Valentin Gapanovich. 

Not to be stuck at the customs
Among the main problems necessary to be solved before the line starts working is the organisation of customs inspections. It can take a few hours for 350 people to go through the necessary customs procedures but a high-speed train does not have this time to spare.
A few variants of customs control procedures have been considered. One is to organise customs registration along the principles of air transport - at the point of departure and at the destination point. But Jarko Saks, Director of Foreign Trade Department at the Customs Management of Finland, said that registration on moving trains seems to be the best choice. Probably, the train will make two short stops on its way so that the customs service staff can get on and off. The question remains of how to organise the return of the passengers not allowed to pass through the border (if such cases occur).

What are the prospects? 
In 2002-2003, when the plans to build the high-speed link were announced, there were discussions on how communications between Helsinki and Moscow (where the majority of Russian companies have their central offices) would be organised. These discussions seem especially advanced because, as has already been mentioned, by the end of 2009 it is planned to start a high-speed service between St. Petersburg and Moscow. 
But the idea of creating a “through service” to the Russian capital has sparked scepticism among Finnish experts. In their view, the through train to Moscow will not be able to compete with air transport, firstly because of the time the journey will take, even when the necessary airport procedures are included. This opinion has been proved: in Russia it is planned to start the high-speed service between St. Petersburg and Moscow by the end of this year and the train will cover the route in 3 ¾ hours. Adding another 3.5 hours for the journey to Helsinki it becomes more than 7 hours. By comparison, it takes 1 hour 20 minutes for planes to cover the distance between these two cities. And in any case, there is the opportunity to change from one high-speed train to another in St. Petersburg. 
Anna Nezhinskaya 

our reference
Currently train fares on the route St. Petersburg – Helsinki are 1st class – 89.1 Euros and 2nd class – 50.8 Euros.
The high-speed train Allegro fares are planned to be: 1st class - 110 Euros and 2nd class – 69.4 Euros. Train capacity is 350 passengers.
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    [DETAIL_TEXT] => 
Russia - Finland: Cooperation To Be Accelerated 
According to the Finnish Customs Service, the share of Russian imports and exports in Finnish foreign trade turnover is between 11 and 16%. This means that Russia is the main economic partner of Finland and this is naturally generating active cooperation within the two counties’ business circles. And when you add the extensive program of cultural and educational cooperation, it becomes clear how necessary a modern passenger link between the two countries is. 
Currently, two passenger trains ply the route between St. Petersburg and Helsinki - the Russian fast train “Repin” and the Finnish fast train “Sibelius” run every day. The capital of Finland can also be reached from Moscow - the train “Lev Tolstoy” departs from the Russian capital’s Leningradski Station every evening. It takes six hours to get to St. Petersburg from Helsinki (just over 400 km) and a little more than 12 hours is needed to reach Moscow (about 1,000 km). More than 200,000 passengers cross the Russian-Finnish border by rail every year. 
In 2010 it is planned to start a direct high-speed service between St. Petersburg and Helsinki (the journey time will be about 
3 ½ hours). It became possible to reduce the time needed for trains to cover the distance in this direction because of the modernisation of the infrastructure, use of high-speed rolling stock and also the streamlining of border and customs formalities. RZD’s forecasts for maximum passenger traffic by high-speed trains are 500,000 people, including (as both Russian and Finnish railwaymen estimate) 100,000 -120,000 passengers attracted from other types of transport, because at the moment Russians (especially those living in St. Petersburg and adjoining regions) prefer to go to Finland via motorway.
We would like to remind readers that there is still no experience in Russia of high-speed movement. The first high-speed trains are planned to start between St. Petersburg and Moscow in the autumn of 2009. The route to Finland will be the second high-speed service experience for Russian railwaymen. At what stage is the project now? 

Allegro is not a mode, it is a train 
The President of RZD Vladimir Yakunin and the Chairman of VR Ltd Henry Kuitunen signed an agreement about the joint-stock company Oy Karelian Trains Ltd on November 23, 2006, in Helsinki, in the presence of the President of Russia Vladimir Putin and the President of Finland Tarja Halonen. This enterprise has been entrusted with the right to acquire specialised trains and to organise maintenance services for them. The results of the international tender to purchase the rolling stock for the organisation of this link became known in June 2007. French company Alstom won the competition. In 2009, Alstom Transport will supply its Pendollino trains for the Russian-Finnish railroad. 
Eighteen similar trains are already in operation in Finland but those meant for use on the Russian-Finnish international link have been modernised. Thus, they have been adapted to the Russian electricity supply system. The maximum speed of such trains will be 220km per hour. Seven carriages will be able to take 352 passengers. At the beginning of 2009 the first train was brought in and it is currently being tested.

Infrastructure questions
Apart from the purchase of new rolling stock, the project speeding up the communication between St. Petersburg and Helsinki involves investment in the Finnish and Russian railway infrastructure.
So, in Finland, reconstruction of the infrastructure on the sector from Lahti to Luumaki is being carried out now. It should be finished by the end of 2010 and this will allow the speed of trains running in this sector to be increased up to 200 km per hour. The cost of the reconstruction will be €185 million. We would like to remind readers that in some areas of Finland the trains will reach a speed of 220km per hour. 
Modernisation of the infrastructure is also taking place on the Russian side of the border. Budget costs for this project are RUR 79.7 billion (€634 million). This project will be partly financed from the Investment Fund of the Russian Federation. The Senior Vice-President of  RZD, Valentin Gapanovich, said that, with state support given during the period 2008-2010, this project will pay for itself, both to RZD and to the state budget of the Russian Federation, in 10 years.
Reconstruction of the rail and overhead contact system is being carried out on the Russian side of the route. Overhead line equipment and 250km of track is planned to be re-laid along the whole length of the line; three overpasses will be built to avoid crossing motorways; and new footbridges will be built too. 
However, the modernisation of the Russian high-speed railroad sector is drawing protests from the public. In order to organise effective high-speed railways, it is necessary to construct additional tracks for cargo trains, and it is planned to make this additional branch pass through the town of Vyborg. Such future plans for additional freight traffic to go through the town have caused a public outcry, despite the fact that it is proposed that they will move exclusively through industrial zones. 
The conflict between regional authorities and RZD started at the end of 2007 when the mayor of the town declared that such construction should not be allowed, and this declaration was supported by other regional authorities. RZD said that the compensation sought by local people was unrealistic. Meanwhile, Vyborg is currently a large cargo port in Russia’s Northwest, and the question of cargo exports through it is quite controversial. Recently, our magazine learnt from RZD that this problem remains unresolved. “Currently it is being considered during joint talks between the head authorities of Vyborg, the Vyborg area and Oktyabrskaya Railway, customer representatives and the project institute,” said Valentin Gapanovich. 

Not to be stuck at the customs
Among the main problems necessary to be solved before the line starts working is the organisation of customs inspections. It can take a few hours for 350 people to go through the necessary customs procedures but a high-speed train does not have this time to spare.
A few variants of customs control procedures have been considered. One is to organise customs registration along the principles of air transport - at the point of departure and at the destination point. But Jarko Saks, Director of Foreign Trade Department at the Customs Management of Finland, said that registration on moving trains seems to be the best choice. Probably, the train will make two short stops on its way so that the customs service staff can get on and off. The question remains of how to organise the return of the passengers not allowed to pass through the border (if such cases occur).

What are the prospects? 
In 2002-2003, when the plans to build the high-speed link were announced, there were discussions on how communications between Helsinki and Moscow (where the majority of Russian companies have their central offices) would be organised. These discussions seem especially advanced because, as has already been mentioned, by the end of 2009 it is planned to start a high-speed service between St. Petersburg and Moscow. 
But the idea of creating a “through service” to the Russian capital has sparked scepticism among Finnish experts. In their view, the through train to Moscow will not be able to compete with air transport, firstly because of the time the journey will take, even when the necessary airport procedures are included. This opinion has been proved: in Russia it is planned to start the high-speed service between St. Petersburg and Moscow by the end of this year and the train will cover the route in 3 ¾ hours. Adding another 3.5 hours for the journey to Helsinki it becomes more than 7 hours. By comparison, it takes 1 hour 20 minutes for planes to cover the distance between these two cities. And in any case, there is the opportunity to change from one high-speed train to another in St. Petersburg. 
Anna Nezhinskaya 

our reference
Currently train fares on the route St. Petersburg – Helsinki are 1st class – 89.1 Euros and 2nd class – 50.8 Euros.
The high-speed train Allegro fares are planned to be: 1st class - 110 Euros and 2nd class – 69.4 Euros. Train capacity is 350 passengers.
    [~DETAIL_TEXT] => 
Russia - Finland: Cooperation To Be Accelerated 
According to the Finnish Customs Service, the share of Russian imports and exports in Finnish foreign trade turnover is between 11 and 16%. This means that Russia is the main economic partner of Finland and this is naturally generating active cooperation within the two counties’ business circles. And when you add the extensive program of cultural and educational cooperation, it becomes clear how necessary a modern passenger link between the two countries is. 
Currently, two passenger trains ply the route between St. Petersburg and Helsinki - the Russian fast train “Repin” and the Finnish fast train “Sibelius” run every day. The capital of Finland can also be reached from Moscow - the train “Lev Tolstoy” departs from the Russian capital’s Leningradski Station every evening. It takes six hours to get to St. Petersburg from Helsinki (just over 400 km) and a little more than 12 hours is needed to reach Moscow (about 1,000 km). More than 200,000 passengers cross the Russian-Finnish border by rail every year. 
In 2010 it is planned to start a direct high-speed service between St. Petersburg and Helsinki (the journey time will be about 
3 ½ hours). It became possible to reduce the time needed for trains to cover the distance in this direction because of the modernisation of the infrastructure, use of high-speed rolling stock and also the streamlining of border and customs formalities. RZD’s forecasts for maximum passenger traffic by high-speed trains are 500,000 people, including (as both Russian and Finnish railwaymen estimate) 100,000 -120,000 passengers attracted from other types of transport, because at the moment Russians (especially those living in St. Petersburg and adjoining regions) prefer to go to Finland via motorway.
We would like to remind readers that there is still no experience in Russia of high-speed movement. The first high-speed trains are planned to start between St. Petersburg and Moscow in the autumn of 2009. The route to Finland will be the second high-speed service experience for Russian railwaymen. At what stage is the project now? 

Allegro is not a mode, it is a train 
The President of RZD Vladimir Yakunin and the Chairman of VR Ltd Henry Kuitunen signed an agreement about the joint-stock company Oy Karelian Trains Ltd on November 23, 2006, in Helsinki, in the presence of the President of Russia Vladimir Putin and the President of Finland Tarja Halonen. This enterprise has been entrusted with the right to acquire specialised trains and to organise maintenance services for them. The results of the international tender to purchase the rolling stock for the organisation of this link became known in June 2007. French company Alstom won the competition. In 2009, Alstom Transport will supply its Pendollino trains for the Russian-Finnish railroad. 
Eighteen similar trains are already in operation in Finland but those meant for use on the Russian-Finnish international link have been modernised. Thus, they have been adapted to the Russian electricity supply system. The maximum speed of such trains will be 220km per hour. Seven carriages will be able to take 352 passengers. At the beginning of 2009 the first train was brought in and it is currently being tested.

Infrastructure questions
Apart from the purchase of new rolling stock, the project speeding up the communication between St. Petersburg and Helsinki involves investment in the Finnish and Russian railway infrastructure.
So, in Finland, reconstruction of the infrastructure on the sector from Lahti to Luumaki is being carried out now. It should be finished by the end of 2010 and this will allow the speed of trains running in this sector to be increased up to 200 km per hour. The cost of the reconstruction will be €185 million. We would like to remind readers that in some areas of Finland the trains will reach a speed of 220km per hour. 
Modernisation of the infrastructure is also taking place on the Russian side of the border. Budget costs for this project are RUR 79.7 billion (€634 million). This project will be partly financed from the Investment Fund of the Russian Federation. The Senior Vice-President of  RZD, Valentin Gapanovich, said that, with state support given during the period 2008-2010, this project will pay for itself, both to RZD and to the state budget of the Russian Federation, in 10 years.
Reconstruction of the rail and overhead contact system is being carried out on the Russian side of the route. Overhead line equipment and 250km of track is planned to be re-laid along the whole length of the line; three overpasses will be built to avoid crossing motorways; and new footbridges will be built too. 
However, the modernisation of the Russian high-speed railroad sector is drawing protests from the public. In order to organise effective high-speed railways, it is necessary to construct additional tracks for cargo trains, and it is planned to make this additional branch pass through the town of Vyborg. Such future plans for additional freight traffic to go through the town have caused a public outcry, despite the fact that it is proposed that they will move exclusively through industrial zones. 
The conflict between regional authorities and RZD started at the end of 2007 when the mayor of the town declared that such construction should not be allowed, and this declaration was supported by other regional authorities. RZD said that the compensation sought by local people was unrealistic. Meanwhile, Vyborg is currently a large cargo port in Russia’s Northwest, and the question of cargo exports through it is quite controversial. Recently, our magazine learnt from RZD that this problem remains unresolved. “Currently it is being considered during joint talks between the head authorities of Vyborg, the Vyborg area and Oktyabrskaya Railway, customer representatives and the project institute,” said Valentin Gapanovich. 

Not to be stuck at the customs
Among the main problems necessary to be solved before the line starts working is the organisation of customs inspections. It can take a few hours for 350 people to go through the necessary customs procedures but a high-speed train does not have this time to spare.
A few variants of customs control procedures have been considered. One is to organise customs registration along the principles of air transport - at the point of departure and at the destination point. But Jarko Saks, Director of Foreign Trade Department at the Customs Management of Finland, said that registration on moving trains seems to be the best choice. Probably, the train will make two short stops on its way so that the customs service staff can get on and off. The question remains of how to organise the return of the passengers not allowed to pass through the border (if such cases occur).

What are the prospects? 
In 2002-2003, when the plans to build the high-speed link were announced, there were discussions on how communications between Helsinki and Moscow (where the majority of Russian companies have their central offices) would be organised. These discussions seem especially advanced because, as has already been mentioned, by the end of 2009 it is planned to start a high-speed service between St. Petersburg and Moscow. 
But the idea of creating a “through service” to the Russian capital has sparked scepticism among Finnish experts. In their view, the through train to Moscow will not be able to compete with air transport, firstly because of the time the journey will take, even when the necessary airport procedures are included. This opinion has been proved: in Russia it is planned to start the high-speed service between St. Petersburg and Moscow by the end of this year and the train will cover the route in 3 ¾ hours. Adding another 3.5 hours for the journey to Helsinki it becomes more than 7 hours. By comparison, it takes 1 hour 20 minutes for planes to cover the distance between these two cities. And in any case, there is the opportunity to change from one high-speed train to another in St. Petersburg. 
Anna Nezhinskaya 

our reference
Currently train fares on the route St. Petersburg – Helsinki are 1st class – 89.1 Euros and 2nd class – 50.8 Euros.
The high-speed train Allegro fares are planned to be: 1st class - 110 Euros and 2nd class – 69.4 Euros. Train capacity is 350 passengers.
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Four Olympic projects
 The Sochi Development Program envisages the modernisation of the whole transport system in the resort zone on the Black Sea coast of Russia, including reconstruction of station halls and the development of infrastructure leading to the Olympic sites,” forecasts Vice-President and Chief Engineer of OAO RZD, Valentin Gapanovich. Experts think that the mountainous conditions, which typically suffer landslips, are among the major factors which define the complexity of the transport projects in this area.  
During realisation of the Olympic project, RZD is planning to complete a number of infrastructure construction projects, and also to upgrade the existing route from Moscow to Adler for high-speed trains. The problem to providing the necessary throughput on the sector from Tuapse to Adler is being solved mainly so cargoes, that are needed for the construction of Olympic infrastructure, can pass. The estimated cost of just the initial phase to strengthen the railway infrastructure on this site will be 13.5 billion roubles. Preparation work for the construction of the second mainline on this site is now taking place, as is the reconstruction of the stations there. According to the calculations done by “Hyprotrans TEI” Institute, this will hepl support the required throughput of trains. 

The resort becomes accessible
RZD Management’s Olympic project list also includes the construction of a combined motorway and railway line from Adler to the station at the bottom of ski resort Rose Farm, with electricity to be supplied for the railway part of this line. The 50-kilometre long light railway will deliver 15,000 passengers every day from the seaside up to the mountains in 35 minutes. OAO RZD’s decision to design and build a new railway sector from Adler to Krasnaya Polyana for suburban high-speed communication, which is supposed to use special rolling stock, requires infrastructure appropriate for this purpose, including the rolling stock itself. The project is interesting and complicated even for RZD and includes up to 12 tunnels. “There will be a motorway and a two-line railway, but in a single technical corridor. This project is being studied at the moment. It includes the erection of a two-storied highway, where cars will run on the top level, and trains on the bottom one. At some points they will converge, and at others they will go in parallel,” the experts from RZD explain. The estimated cost of this project is about 260 billion roubles. 
The chosen concept required Russian Railways either to develop its own new generation of railcars or to attract a foreign partner which would be able to supply such trains to Russia in the short term. By the end of autumn, RZD’s Management had chosen the second option, and in late November a competition to create 54 passenger trains for Russia was announced. The trains had to have a service life of 40 years from the date of supply. The competition documentation was sent to three of the largest, globally-recognised  companies - Bombardier, Alstom and Siemens. The Spacium 3.06 platform offered by Bombardier was the best, but later the winner of the tender and the customer failed to agree on the conditions of the contract.
We should note, however, that the technical features of this train are unusual even for Europeans. Even French passengers are not used to climate-control and to floor heating in electric trains, and the unusually wide (1.95 metres) carriage doors can allow a record number of people to squeeze in simultaneously. In   total, this train could take up to 915 passengers, 500 of whom would have seats. Also, it will be possible to look for vacant seats from a distance, because there are no walls between carriages. Moreover, digital boards will work on the ceiling in each carriage, and walls will have built-in screens. The train is able to develop a speed of up to 140 kilometres per hour, which matches the requirements of the Russian customer. As a result, RZD launched negotiations with Siemens AG, so there are two contenders at the moment. 

By train instead of by car
The third large RZD project will be laying a railway line between Adler and Sochi airport, requiring tunnels to be built. Almost 3 kilometres of railroad will stretch alongside the projected motorway from Sochi to the airport. Company investments into development of intermodal transportation on this site will be RUR 60 millions, and the creation of the whole mainline will require RUR 6 billion from RZD. The projected railroad line ends at Sochi Airport Passenger Terminal. Arrival and departure halls at the airport will be connected to  the platforms by covered galleries, with travelators, or moving sidewalks, because it is planned that the Paralympics Games will be held in Sochi too, which demands comfortable conditions for people with disabilities. The forecast for air transport growth is that 2.4 million people per year will be arriving in the airport by 2014, compared with 1.5 million in 2007. High-speed electric trains are expected to carry about 250 people per trip. Five high-comfort electric trains are expected to shuttle between Adler and Sochi Airport. Today only motorways are available along this route, but after this new branch has been built, it will be possible to get to Sochi from the Airport by electric train, and then to change to travel on to Tuapse, or further along the coast.

The night competitor
There will be another RZD project, which is not an Olympic one, but is no less significant for the whole Olympic capital infrastructure. It is the modernisation of the existing railway from Moscow to Sochi, and the organisation of high-speed movement on it. Work on this was started in 2004. RZD chose a variant of high-speed passenger movement in the direction of Kursk. For this purpose it is necessary to build a third mainline on the sector from Moscow to Tula, to modernise existing lines to meet high-speed standards, to build a way around the territory of the Ukraine, etc. The total length of the modernised line from Moscow to Adler will be 1,900 kilometres, and RZD intends to reduce the journey time from 25 to 14 hours. This will create a situation where specially organised overnight trains from Moscow to Adler may become a serious competitor to air transport and raise the income of the company by attracting large numbers of passengers who can afford to travel. Russian engineering documentation, as well as European normative requirements for fast and high-speed communication, formed the basis for the development of higher speeds. Preliminary forecasts state that adapting of existing railway lines for high-speed communication from Moscow to the Black Sea resorts will cost more than 400 billion roubles.
And finally, sea terminals will be among the most important transport infrastructure sites. Overall, it is planned to realise three projects in the framework of the Sea Transport Infrastructure Preparation Program. The first one is connected with the construction of a new cargo port at the mouth of the river Mzymta, which is to be reorganised later to receive small passenger vessels. The total cost of the project is more than 6.5 billion roubles, and the outlined capacity will be 5 million tons of cargo per year. It is planned that the port will receive its first cargoes in autumn 2009 and will start working at full capacity in the first half of 2010. 
The second project will be the crucial reorganization of the port of Sochi with the construction of a long pier - a mooring for large cruise vessels. Preliminary estimates say the reconstruction of Sochi Seaport will require about 10 billion roubles and will be able to accept  up to 150-200 cruise vessels per year. The third project is the construction of 15 landing stages from Sochi to Lazarevskoye to allow the resumption of passenger transport, making it possible for tourists to travel between the various points within 60-70 kilometres of the Sochi Port area. 

The crisis will not affect it
Experts’ forecasts about the future of transport infrastructure construction, given the financial crisis, are ambiguous. But, according to the Minister for Sports, Tourism and Youth Policy of Russia, Vitaliy Mutko, the financial crisis that has made the world economy suffer will not affect preparations for the Sochi Olympic Games 2014 at all. He said that, so far, there are no problems with construction; all are progressing in targeted time frames and going according to plan. Moreover, the authorities of the country are sure that, even if private investors suddenly have problems with construction, the Federal Budget will be ready to cover expenses and thus construction will move forward as planned. A similar opinion is expressed by The Ministry of Regional Development. “The world financial crisis is maybe having some affects on the preparation for the 2014 Sochi Olympics, but so far there have no refusals by investors to build Olympic sites,” representatives of the ministry said. The investment attractiveness of this project is large enough, but if investors start to refuse, it will be necessary either to search for other companies, or to use budgetary funds, because the state does not have another solution. “We are obliged to finish all projected work not later than the third quarter of 2013 because we should start to carry passengers in the course of the whole winter before 2014 when we open the Olympics. It is an obligatory condition,” RZD’s Management concluded.
On the other hand, representatives in Russia of the international consulting company Grant Thornton note that the recession in the economy is likely to lead to some delays in terms of  projects realisation. They may start in 2009, continue next year, and will affect, first of all, the projects involving private investors. So, experts are sure that all on-ground motorway and railway construction will go ahead within the schedule, while the prospects for the erection of the airport complex by the holding group “Base Element” may become doubtful because of the difficulties which its owner, Oleg Deripaska, is experiencing. “In the worst case some further troubles could cause an increase in the timeframes of the project realisation, and additional expenses,” the Grant Thornton analysts believe. 
Maria Shevchenko 
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Four Olympic projects
 The Sochi Development Program envisages the modernisation of the whole transport system in the resort zone on the Black Sea coast of Russia, including reconstruction of station halls and the development of infrastructure leading to the Olympic sites,” forecasts Vice-President and Chief Engineer of OAO RZD, Valentin Gapanovich. Experts think that the mountainous conditions, which typically suffer landslips, are among the major factors which define the complexity of the transport projects in this area.  
During realisation of the Olympic project, RZD is planning to complete a number of infrastructure construction projects, and also to upgrade the existing route from Moscow to Adler for high-speed trains. The problem to providing the necessary throughput on the sector from Tuapse to Adler is being solved mainly so cargoes, that are needed for the construction of Olympic infrastructure, can pass. The estimated cost of just the initial phase to strengthen the railway infrastructure on this site will be 13.5 billion roubles. Preparation work for the construction of the second mainline on this site is now taking place, as is the reconstruction of the stations there. According to the calculations done by “Hyprotrans TEI” Institute, this will hepl support the required throughput of trains. 

The resort becomes accessible
RZD Management’s Olympic project list also includes the construction of a combined motorway and railway line from Adler to the station at the bottom of ski resort Rose Farm, with electricity to be supplied for the railway part of this line. The 50-kilometre long light railway will deliver 15,000 passengers every day from the seaside up to the mountains in 35 minutes. OAO RZD’s decision to design and build a new railway sector from Adler to Krasnaya Polyana for suburban high-speed communication, which is supposed to use special rolling stock, requires infrastructure appropriate for this purpose, including the rolling stock itself. The project is interesting and complicated even for RZD and includes up to 12 tunnels. “There will be a motorway and a two-line railway, but in a single technical corridor. This project is being studied at the moment. It includes the erection of a two-storied highway, where cars will run on the top level, and trains on the bottom one. At some points they will converge, and at others they will go in parallel,” the experts from RZD explain. The estimated cost of this project is about 260 billion roubles. 
The chosen concept required Russian Railways either to develop its own new generation of railcars or to attract a foreign partner which would be able to supply such trains to Russia in the short term. By the end of autumn, RZD’s Management had chosen the second option, and in late November a competition to create 54 passenger trains for Russia was announced. The trains had to have a service life of 40 years from the date of supply. The competition documentation was sent to three of the largest, globally-recognised  companies - Bombardier, Alstom and Siemens. The Spacium 3.06 platform offered by Bombardier was the best, but later the winner of the tender and the customer failed to agree on the conditions of the contract.
We should note, however, that the technical features of this train are unusual even for Europeans. Even French passengers are not used to climate-control and to floor heating in electric trains, and the unusually wide (1.95 metres) carriage doors can allow a record number of people to squeeze in simultaneously. In   total, this train could take up to 915 passengers, 500 of whom would have seats. Also, it will be possible to look for vacant seats from a distance, because there are no walls between carriages. Moreover, digital boards will work on the ceiling in each carriage, and walls will have built-in screens. The train is able to develop a speed of up to 140 kilometres per hour, which matches the requirements of the Russian customer. As a result, RZD launched negotiations with Siemens AG, so there are two contenders at the moment. 

By train instead of by car
The third large RZD project will be laying a railway line between Adler and Sochi airport, requiring tunnels to be built. Almost 3 kilometres of railroad will stretch alongside the projected motorway from Sochi to the airport. Company investments into development of intermodal transportation on this site will be RUR 60 millions, and the creation of the whole mainline will require RUR 6 billion from RZD. The projected railroad line ends at Sochi Airport Passenger Terminal. Arrival and departure halls at the airport will be connected to  the platforms by covered galleries, with travelators, or moving sidewalks, because it is planned that the Paralympics Games will be held in Sochi too, which demands comfortable conditions for people with disabilities. The forecast for air transport growth is that 2.4 million people per year will be arriving in the airport by 2014, compared with 1.5 million in 2007. High-speed electric trains are expected to carry about 250 people per trip. Five high-comfort electric trains are expected to shuttle between Adler and Sochi Airport. Today only motorways are available along this route, but after this new branch has been built, it will be possible to get to Sochi from the Airport by electric train, and then to change to travel on to Tuapse, or further along the coast.

The night competitor
There will be another RZD project, which is not an Olympic one, but is no less significant for the whole Olympic capital infrastructure. It is the modernisation of the existing railway from Moscow to Sochi, and the organisation of high-speed movement on it. Work on this was started in 2004. RZD chose a variant of high-speed passenger movement in the direction of Kursk. For this purpose it is necessary to build a third mainline on the sector from Moscow to Tula, to modernise existing lines to meet high-speed standards, to build a way around the territory of the Ukraine, etc. The total length of the modernised line from Moscow to Adler will be 1,900 kilometres, and RZD intends to reduce the journey time from 25 to 14 hours. This will create a situation where specially organised overnight trains from Moscow to Adler may become a serious competitor to air transport and raise the income of the company by attracting large numbers of passengers who can afford to travel. Russian engineering documentation, as well as European normative requirements for fast and high-speed communication, formed the basis for the development of higher speeds. Preliminary forecasts state that adapting of existing railway lines for high-speed communication from Moscow to the Black Sea resorts will cost more than 400 billion roubles.
And finally, sea terminals will be among the most important transport infrastructure sites. Overall, it is planned to realise three projects in the framework of the Sea Transport Infrastructure Preparation Program. The first one is connected with the construction of a new cargo port at the mouth of the river Mzymta, which is to be reorganised later to receive small passenger vessels. The total cost of the project is more than 6.5 billion roubles, and the outlined capacity will be 5 million tons of cargo per year. It is planned that the port will receive its first cargoes in autumn 2009 and will start working at full capacity in the first half of 2010. 
The second project will be the crucial reorganization of the port of Sochi with the construction of a long pier - a mooring for large cruise vessels. Preliminary estimates say the reconstruction of Sochi Seaport will require about 10 billion roubles and will be able to accept  up to 150-200 cruise vessels per year. The third project is the construction of 15 landing stages from Sochi to Lazarevskoye to allow the resumption of passenger transport, making it possible for tourists to travel between the various points within 60-70 kilometres of the Sochi Port area. 

The crisis will not affect it
Experts’ forecasts about the future of transport infrastructure construction, given the financial crisis, are ambiguous. But, according to the Minister for Sports, Tourism and Youth Policy of Russia, Vitaliy Mutko, the financial crisis that has made the world economy suffer will not affect preparations for the Sochi Olympic Games 2014 at all. He said that, so far, there are no problems with construction; all are progressing in targeted time frames and going according to plan. Moreover, the authorities of the country are sure that, even if private investors suddenly have problems with construction, the Federal Budget will be ready to cover expenses and thus construction will move forward as planned. A similar opinion is expressed by The Ministry of Regional Development. “The world financial crisis is maybe having some affects on the preparation for the 2014 Sochi Olympics, but so far there have no refusals by investors to build Olympic sites,” representatives of the ministry said. The investment attractiveness of this project is large enough, but if investors start to refuse, it will be necessary either to search for other companies, or to use budgetary funds, because the state does not have another solution. “We are obliged to finish all projected work not later than the third quarter of 2013 because we should start to carry passengers in the course of the whole winter before 2014 when we open the Olympics. It is an obligatory condition,” RZD’s Management concluded.
On the other hand, representatives in Russia of the international consulting company Grant Thornton note that the recession in the economy is likely to lead to some delays in terms of  projects realisation. They may start in 2009, continue next year, and will affect, first of all, the projects involving private investors. So, experts are sure that all on-ground motorway and railway construction will go ahead within the schedule, while the prospects for the erection of the airport complex by the holding group “Base Element” may become doubtful because of the difficulties which its owner, Oleg Deripaska, is experiencing. “In the worst case some further troubles could cause an increase in the timeframes of the project realisation, and additional expenses,” the Grant Thornton analysts believe. 
Maria Shevchenko 
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            [SECTION_META_DESCRIPTION] => <img src="/ufiles/image/rus/partner/2009/3/3.jpg" border="1" alt=" " hspace="5" width="300" height="248" align="left" />Most of the funds allocated for the Winter Olympics 2014 will be used to pay for the transport infrastructure in Sochi. OAO RZD Management, in its turn, plans to spend almost 300 billion roubles on Olympic projects alone, in addition to the cost of the high-speed link from Moscow to Adler. Experts estimate that, as a result of the realisation of the transport development program in Sochi, more than <br />100 kilometres of new railway lines will be built.
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            [ELEMENT_META_DESCRIPTION] => <img src="/ufiles/image/rus/partner/2009/3/3.jpg" border="1" alt=" " hspace="5" width="300" height="248" align="left" />Most of the funds allocated for the Winter Olympics 2014 will be used to pay for the transport infrastructure in Sochi. OAO RZD Management, in its turn, plans to spend almost 300 billion roubles on Olympic projects alone, in addition to the cost of the high-speed link from Moscow to Adler. Experts estimate that, as a result of the realisation of the transport development program in Sochi, more than <br />100 kilometres of new railway lines will be built.
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Four Olympic projects
 The Sochi Development Program envisages the modernisation of the whole transport system in the resort zone on the Black Sea coast of Russia, including reconstruction of station halls and the development of infrastructure leading to the Olympic sites,” forecasts Vice-President and Chief Engineer of OAO RZD, Valentin Gapanovich. Experts think that the mountainous conditions, which typically suffer landslips, are among the major factors which define the complexity of the transport projects in this area.  
During realisation of the Olympic project, RZD is planning to complete a number of infrastructure construction projects, and also to upgrade the existing route from Moscow to Adler for high-speed trains. The problem to providing the necessary throughput on the sector from Tuapse to Adler is being solved mainly so cargoes, that are needed for the construction of Olympic infrastructure, can pass. The estimated cost of just the initial phase to strengthen the railway infrastructure on this site will be 13.5 billion roubles. Preparation work for the construction of the second mainline on this site is now taking place, as is the reconstruction of the stations there. According to the calculations done by “Hyprotrans TEI” Institute, this will hepl support the required throughput of trains. 

The resort becomes accessible
RZD Management’s Olympic project list also includes the construction of a combined motorway and railway line from Adler to the station at the bottom of ski resort Rose Farm, with electricity to be supplied for the railway part of this line. The 50-kilometre long light railway will deliver 15,000 passengers every day from the seaside up to the mountains in 35 minutes. OAO RZD’s decision to design and build a new railway sector from Adler to Krasnaya Polyana for suburban high-speed communication, which is supposed to use special rolling stock, requires infrastructure appropriate for this purpose, including the rolling stock itself. The project is interesting and complicated even for RZD and includes up to 12 tunnels. “There will be a motorway and a two-line railway, but in a single technical corridor. This project is being studied at the moment. It includes the erection of a two-storied highway, where cars will run on the top level, and trains on the bottom one. At some points they will converge, and at others they will go in parallel,” the experts from RZD explain. The estimated cost of this project is about 260 billion roubles. 
The chosen concept required Russian Railways either to develop its own new generation of railcars or to attract a foreign partner which would be able to supply such trains to Russia in the short term. By the end of autumn, RZD’s Management had chosen the second option, and in late November a competition to create 54 passenger trains for Russia was announced. The trains had to have a service life of 40 years from the date of supply. The competition documentation was sent to three of the largest, globally-recognised  companies - Bombardier, Alstom and Siemens. The Spacium 3.06 platform offered by Bombardier was the best, but later the winner of the tender and the customer failed to agree on the conditions of the contract.
We should note, however, that the technical features of this train are unusual even for Europeans. Even French passengers are not used to climate-control and to floor heating in electric trains, and the unusually wide (1.95 metres) carriage doors can allow a record number of people to squeeze in simultaneously. In   total, this train could take up to 915 passengers, 500 of whom would have seats. Also, it will be possible to look for vacant seats from a distance, because there are no walls between carriages. Moreover, digital boards will work on the ceiling in each carriage, and walls will have built-in screens. The train is able to develop a speed of up to 140 kilometres per hour, which matches the requirements of the Russian customer. As a result, RZD launched negotiations with Siemens AG, so there are two contenders at the moment. 

By train instead of by car
The third large RZD project will be laying a railway line between Adler and Sochi airport, requiring tunnels to be built. Almost 3 kilometres of railroad will stretch alongside the projected motorway from Sochi to the airport. Company investments into development of intermodal transportation on this site will be RUR 60 millions, and the creation of the whole mainline will require RUR 6 billion from RZD. The projected railroad line ends at Sochi Airport Passenger Terminal. Arrival and departure halls at the airport will be connected to  the platforms by covered galleries, with travelators, or moving sidewalks, because it is planned that the Paralympics Games will be held in Sochi too, which demands comfortable conditions for people with disabilities. The forecast for air transport growth is that 2.4 million people per year will be arriving in the airport by 2014, compared with 1.5 million in 2007. High-speed electric trains are expected to carry about 250 people per trip. Five high-comfort electric trains are expected to shuttle between Adler and Sochi Airport. Today only motorways are available along this route, but after this new branch has been built, it will be possible to get to Sochi from the Airport by electric train, and then to change to travel on to Tuapse, or further along the coast.

The night competitor
There will be another RZD project, which is not an Olympic one, but is no less significant for the whole Olympic capital infrastructure. It is the modernisation of the existing railway from Moscow to Sochi, and the organisation of high-speed movement on it. Work on this was started in 2004. RZD chose a variant of high-speed passenger movement in the direction of Kursk. For this purpose it is necessary to build a third mainline on the sector from Moscow to Tula, to modernise existing lines to meet high-speed standards, to build a way around the territory of the Ukraine, etc. The total length of the modernised line from Moscow to Adler will be 1,900 kilometres, and RZD intends to reduce the journey time from 25 to 14 hours. This will create a situation where specially organised overnight trains from Moscow to Adler may become a serious competitor to air transport and raise the income of the company by attracting large numbers of passengers who can afford to travel. Russian engineering documentation, as well as European normative requirements for fast and high-speed communication, formed the basis for the development of higher speeds. Preliminary forecasts state that adapting of existing railway lines for high-speed communication from Moscow to the Black Sea resorts will cost more than 400 billion roubles.
And finally, sea terminals will be among the most important transport infrastructure sites. Overall, it is planned to realise three projects in the framework of the Sea Transport Infrastructure Preparation Program. The first one is connected with the construction of a new cargo port at the mouth of the river Mzymta, which is to be reorganised later to receive small passenger vessels. The total cost of the project is more than 6.5 billion roubles, and the outlined capacity will be 5 million tons of cargo per year. It is planned that the port will receive its first cargoes in autumn 2009 and will start working at full capacity in the first half of 2010. 
The second project will be the crucial reorganization of the port of Sochi with the construction of a long pier - a mooring for large cruise vessels. Preliminary estimates say the reconstruction of Sochi Seaport will require about 10 billion roubles and will be able to accept  up to 150-200 cruise vessels per year. The third project is the construction of 15 landing stages from Sochi to Lazarevskoye to allow the resumption of passenger transport, making it possible for tourists to travel between the various points within 60-70 kilometres of the Sochi Port area. 

The crisis will not affect it
Experts’ forecasts about the future of transport infrastructure construction, given the financial crisis, are ambiguous. But, according to the Minister for Sports, Tourism and Youth Policy of Russia, Vitaliy Mutko, the financial crisis that has made the world economy suffer will not affect preparations for the Sochi Olympic Games 2014 at all. He said that, so far, there are no problems with construction; all are progressing in targeted time frames and going according to plan. Moreover, the authorities of the country are sure that, even if private investors suddenly have problems with construction, the Federal Budget will be ready to cover expenses and thus construction will move forward as planned. A similar opinion is expressed by The Ministry of Regional Development. “The world financial crisis is maybe having some affects on the preparation for the 2014 Sochi Olympics, but so far there have no refusals by investors to build Olympic sites,” representatives of the ministry said. The investment attractiveness of this project is large enough, but if investors start to refuse, it will be necessary either to search for other companies, or to use budgetary funds, because the state does not have another solution. “We are obliged to finish all projected work not later than the third quarter of 2013 because we should start to carry passengers in the course of the whole winter before 2014 when we open the Olympics. It is an obligatory condition,” RZD’s Management concluded.
On the other hand, representatives in Russia of the international consulting company Grant Thornton note that the recession in the economy is likely to lead to some delays in terms of  projects realisation. They may start in 2009, continue next year, and will affect, first of all, the projects involving private investors. So, experts are sure that all on-ground motorway and railway construction will go ahead within the schedule, while the prospects for the erection of the airport complex by the holding group “Base Element” may become doubtful because of the difficulties which its owner, Oleg Deripaska, is experiencing. “In the worst case some further troubles could cause an increase in the timeframes of the project realisation, and additional expenses,” the Grant Thornton analysts believe. 
Maria Shevchenko 
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Four Olympic projects
 The Sochi Development Program envisages the modernisation of the whole transport system in the resort zone on the Black Sea coast of Russia, including reconstruction of station halls and the development of infrastructure leading to the Olympic sites,” forecasts Vice-President and Chief Engineer of OAO RZD, Valentin Gapanovich. Experts think that the mountainous conditions, which typically suffer landslips, are among the major factors which define the complexity of the transport projects in this area.  
During realisation of the Olympic project, RZD is planning to complete a number of infrastructure construction projects, and also to upgrade the existing route from Moscow to Adler for high-speed trains. The problem to providing the necessary throughput on the sector from Tuapse to Adler is being solved mainly so cargoes, that are needed for the construction of Olympic infrastructure, can pass. The estimated cost of just the initial phase to strengthen the railway infrastructure on this site will be 13.5 billion roubles. Preparation work for the construction of the second mainline on this site is now taking place, as is the reconstruction of the stations there. According to the calculations done by “Hyprotrans TEI” Institute, this will hepl support the required throughput of trains. 

The resort becomes accessible
RZD Management’s Olympic project list also includes the construction of a combined motorway and railway line from Adler to the station at the bottom of ski resort Rose Farm, with electricity to be supplied for the railway part of this line. The 50-kilometre long light railway will deliver 15,000 passengers every day from the seaside up to the mountains in 35 minutes. OAO RZD’s decision to design and build a new railway sector from Adler to Krasnaya Polyana for suburban high-speed communication, which is supposed to use special rolling stock, requires infrastructure appropriate for this purpose, including the rolling stock itself. The project is interesting and complicated even for RZD and includes up to 12 tunnels. “There will be a motorway and a two-line railway, but in a single technical corridor. This project is being studied at the moment. It includes the erection of a two-storied highway, where cars will run on the top level, and trains on the bottom one. At some points they will converge, and at others they will go in parallel,” the experts from RZD explain. The estimated cost of this project is about 260 billion roubles. 
The chosen concept required Russian Railways either to develop its own new generation of railcars or to attract a foreign partner which would be able to supply such trains to Russia in the short term. By the end of autumn, RZD’s Management had chosen the second option, and in late November a competition to create 54 passenger trains for Russia was announced. The trains had to have a service life of 40 years from the date of supply. The competition documentation was sent to three of the largest, globally-recognised  companies - Bombardier, Alstom and Siemens. The Spacium 3.06 platform offered by Bombardier was the best, but later the winner of the tender and the customer failed to agree on the conditions of the contract.
We should note, however, that the technical features of this train are unusual even for Europeans. Even French passengers are not used to climate-control and to floor heating in electric trains, and the unusually wide (1.95 metres) carriage doors can allow a record number of people to squeeze in simultaneously. In   total, this train could take up to 915 passengers, 500 of whom would have seats. Also, it will be possible to look for vacant seats from a distance, because there are no walls between carriages. Moreover, digital boards will work on the ceiling in each carriage, and walls will have built-in screens. The train is able to develop a speed of up to 140 kilometres per hour, which matches the requirements of the Russian customer. As a result, RZD launched negotiations with Siemens AG, so there are two contenders at the moment. 

By train instead of by car
The third large RZD project will be laying a railway line between Adler and Sochi airport, requiring tunnels to be built. Almost 3 kilometres of railroad will stretch alongside the projected motorway from Sochi to the airport. Company investments into development of intermodal transportation on this site will be RUR 60 millions, and the creation of the whole mainline will require RUR 6 billion from RZD. The projected railroad line ends at Sochi Airport Passenger Terminal. Arrival and departure halls at the airport will be connected to  the platforms by covered galleries, with travelators, or moving sidewalks, because it is planned that the Paralympics Games will be held in Sochi too, which demands comfortable conditions for people with disabilities. The forecast for air transport growth is that 2.4 million people per year will be arriving in the airport by 2014, compared with 1.5 million in 2007. High-speed electric trains are expected to carry about 250 people per trip. Five high-comfort electric trains are expected to shuttle between Adler and Sochi Airport. Today only motorways are available along this route, but after this new branch has been built, it will be possible to get to Sochi from the Airport by electric train, and then to change to travel on to Tuapse, or further along the coast.

The night competitor
There will be another RZD project, which is not an Olympic one, but is no less significant for the whole Olympic capital infrastructure. It is the modernisation of the existing railway from Moscow to Sochi, and the organisation of high-speed movement on it. Work on this was started in 2004. RZD chose a variant of high-speed passenger movement in the direction of Kursk. For this purpose it is necessary to build a third mainline on the sector from Moscow to Tula, to modernise existing lines to meet high-speed standards, to build a way around the territory of the Ukraine, etc. The total length of the modernised line from Moscow to Adler will be 1,900 kilometres, and RZD intends to reduce the journey time from 25 to 14 hours. This will create a situation where specially organised overnight trains from Moscow to Adler may become a serious competitor to air transport and raise the income of the company by attracting large numbers of passengers who can afford to travel. Russian engineering documentation, as well as European normative requirements for fast and high-speed communication, formed the basis for the development of higher speeds. Preliminary forecasts state that adapting of existing railway lines for high-speed communication from Moscow to the Black Sea resorts will cost more than 400 billion roubles.
And finally, sea terminals will be among the most important transport infrastructure sites. Overall, it is planned to realise three projects in the framework of the Sea Transport Infrastructure Preparation Program. The first one is connected with the construction of a new cargo port at the mouth of the river Mzymta, which is to be reorganised later to receive small passenger vessels. The total cost of the project is more than 6.5 billion roubles, and the outlined capacity will be 5 million tons of cargo per year. It is planned that the port will receive its first cargoes in autumn 2009 and will start working at full capacity in the first half of 2010. 
The second project will be the crucial reorganization of the port of Sochi with the construction of a long pier - a mooring for large cruise vessels. Preliminary estimates say the reconstruction of Sochi Seaport will require about 10 billion roubles and will be able to accept  up to 150-200 cruise vessels per year. The third project is the construction of 15 landing stages from Sochi to Lazarevskoye to allow the resumption of passenger transport, making it possible for tourists to travel between the various points within 60-70 kilometres of the Sochi Port area. 

The crisis will not affect it
Experts’ forecasts about the future of transport infrastructure construction, given the financial crisis, are ambiguous. But, according to the Minister for Sports, Tourism and Youth Policy of Russia, Vitaliy Mutko, the financial crisis that has made the world economy suffer will not affect preparations for the Sochi Olympic Games 2014 at all. He said that, so far, there are no problems with construction; all are progressing in targeted time frames and going according to plan. Moreover, the authorities of the country are sure that, even if private investors suddenly have problems with construction, the Federal Budget will be ready to cover expenses and thus construction will move forward as planned. A similar opinion is expressed by The Ministry of Regional Development. “The world financial crisis is maybe having some affects on the preparation for the 2014 Sochi Olympics, but so far there have no refusals by investors to build Olympic sites,” representatives of the ministry said. The investment attractiveness of this project is large enough, but if investors start to refuse, it will be necessary either to search for other companies, or to use budgetary funds, because the state does not have another solution. “We are obliged to finish all projected work not later than the third quarter of 2013 because we should start to carry passengers in the course of the whole winter before 2014 when we open the Olympics. It is an obligatory condition,” RZD’s Management concluded.
On the other hand, representatives in Russia of the international consulting company Grant Thornton note that the recession in the economy is likely to lead to some delays in terms of  projects realisation. They may start in 2009, continue next year, and will affect, first of all, the projects involving private investors. So, experts are sure that all on-ground motorway and railway construction will go ahead within the schedule, while the prospects for the erection of the airport complex by the holding group “Base Element” may become doubtful because of the difficulties which its owner, Oleg Deripaska, is experiencing. “In the worst case some further troubles could cause an increase in the timeframes of the project realisation, and additional expenses,” the Grant Thornton analysts believe. 
Maria Shevchenko 
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            [SECTION_META_DESCRIPTION] => <img src="/ufiles/image/rus/partner/2009/3/3.jpg" border="1" alt=" " hspace="5" width="300" height="248" align="left" />Most of the funds allocated for the Winter Olympics 2014 will be used to pay for the transport infrastructure in Sochi. OAO RZD Management, in its turn, plans to spend almost 300 billion roubles on Olympic projects alone, in addition to the cost of the high-speed link from Moscow to Adler. Experts estimate that, as a result of the realisation of the transport development program in Sochi, more than <br />100 kilometres of new railway lines will be built.
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A Monument to the High-Speed Mainline 
There is leader in Russia’s railway sector who has ever managed to realise a speed and high-speed project in this country before, although the prospects for the railway service with speeds of 200 km per hour and more were seriously discussed during sessions of the Council of Ministers in the USSR as long ago as in the 1960s. The fact is that in 1964 Japan built a railway that could hold passenger trains with a speed of 210 km/h. The Soviet Union could not put up with the fact that the country that sent the first man to Space lagged behind in railway transport. The Council of Ministers of the USSR took a decision to start work on a similar national project.  According to the USSR’s high-speed engineering design project, Moscow was planned to be linked by railway line to Leningrad (today St. Petersburg) and the main country’s resorts in the Crimea and the Caucasus. 
It was difficult for the developers to make choose the traction facilities at the very beginning, therefore pilot models of an electric locomotive and an electric train were ordered. During the next ten years, new rolling stock was developing. It was a high-speed electric train (ER-200) in Riga, and a high-speed locomotive ChS-200 in the Czech town of Plzen. Carriages for the Czech locomotive named “Russian Troika” had to be produced by the Kalininsky Carriage-Building Plant in Tver. 
In time this project was stopped, and only ER-200 was added to the railway fleet.  
The decision to revive the project was made only by the end of the 1980s, this time in an abbreviated version. It was decided to organise a high-speed service between Moscow and Leningrad. For this purpose in the beginning of the 1990s a joint-stock company “High-Speed Railways” was created. It was planned to build the railway mainline itself, a transport commercial complex, and to create such a rolling stock which could ply the railroad at a speed of 350 km/h. The new train received the name “Sokol”, and the Central Engineering Design Office “Rubin” was appointed to work it out. A total of 60 scientific, engineering and military defence enterprises were involved in work on this train. But this project never got a chance to be realised. It was closed by 2000 because of economic and financial problems. 
The idea to create high-speed railway started sounding again in the first decade of the 21st century. The Chief Expert from OAO Lengiprotrans Railway Research and Engineering Department, Timur Us, said: “In the 1980s our institute finalised the first feasibility report for the construction of the high-speed railway mainline between two capitals. Fourteen variants of the road were created then. Now we are making a substantiation of the investment in the construction of the chosen project. But essential changes in the national legislation took place after the project research was done in 1992. In particular, requirements were toughened in the sphere of land and ecological certification. As a result, the previously chosen variant was again not the most favourable, not optimal from the point of view of following the legal norms.”

 Heritage of the Past
Institute experts which have been involved in the creation of the general mainline project since the beginning of 2008 have been given a new purpose to create another variant of the route. It had to be an alternative to the route that was chosen in early 1990s and was then named “The Novgorod Direction”. “The issue is that the so-called “Novgorod variant” was chosen as the main one at that time, because it gave an opportunity to a large number of people to move in the shortest time within the historical and cultural triangle between Moscow, Novgorod and St. Petersburg. The high speed mainline had to come up to Novgorod at a distance of 30 km, which allowed Novgorod to be reached by public transport. But considerable changes took place in Russian land law within the next period before 2008,” says the Deputy Chief Engineer of the Lengiprotrans Institute, Vladimir Romanov. In particular, four new protected natural zones were created in the Novgorod area, in addition to the Valdai National Park. Speaking first of all about the National Park “Valdai”, located in the Novgorod area, there the high-speed line runs by 24 km of its land, and then about 2 km of Zavidovo zone; and additionally, other new sites appeared on the earlier planned line’s territory too. Thus, apart from the high-speed railway line, a motorway is being planned between Moscow and St. Petersburg. Its future facilities “borrow” the same territory as the high-speed railway, for which a route had been approved earlier. 
“The main problem with this project is the existence of a large number of highly protected natural reserves in the railway mainline’s corridor, and it is necessary to take them into account. Also problematic is the fact of designing the high-speed motorway between St. Petersburg and Moscow, which is passing too close to the chosen route for the high-speed railway mainline. In this respect we have faced the need to coordinate the parameters of draining system and crossings with local motorways,” emphasised Mr Romanov. It is interesting that, according to current legislation, there is no real opportunity to change the borders of the highly protected natural territories, except for their closing by authorised governmental bodies. Designing linear objects requires detours of such territories, and as consequence, the route will be longer. For example, just the Valdai reserve detour may add extra 43 km to the route. 

The Western Variant: Pro and Contra
As a result, experts from the Lengiprotrans institute had to begin work on the project again, choosing a route for the future line. Mr Romanov says that the following criteria were set up as the basis for the proposed project’s evaluation:
• The line should have such length and parameters, which would allow for a 2.5-hour train run between Moscow and St. Petersburg;
• In terms of structure, the line must give an opportunity to increase speed on the route up to 400 km/h;
• The length of the railway in the protected nature reserves must be reduced as much as possible;
• Volumetric characteristics will be considered, which is the quantity of construction and volume of excavation work for the construction needed.
“The so-called “Western” variant matched these criteria better than seven other variants suggested. It was approved by RZD’s Scientific and Technical Council, which took place in spring 2009,” tells Mr Romanov. So, the high-speed railway mainline goes from St. Petersburg to Valdai almost in parallel with the currently operating fast railroad between St-Petersburg and Moscow, but then it bypasses the main restricted area and comes out on the route of the “Novgorod” variant near the town of Vyshni Volochek. The management of the Lengiprotrans Institute says that such a variant will have better technical and economic parameters than the “Novgorod variant”. Also, it is more advantageous in terms of matching the environmental requirements. 
So, the problem seems to be solved; but this variant of high-speed route has a number of opponents. Thus the management of the Novgorod Oblast paid attention to the fact that the “Novgorod” variant was more attractive in another way – the railroad in this case had to go through the areas where transport communications were currently undeveloped.
The ussue is that the first variant assumed that the mainline would be laid in only 35 km from Novgorod and thus would increase a tourist flow in this region. The new project will bypass this former trading capital of Russia at a distance of 65 km. The same goes for all key recreational zones in that area. The detour of the Valdai National Park is planned in the area of Uglovka station, where the distance between a possible railway station and the touristic and recreational zone would be about 40 km. Experts from Lengiprotrans suggest solving this problem by creating a high-speed railway link along the existing line between Chudovo and Novgorod, which would allow for maintaining a local high-speed service between St. Petersburg and Novgorod in future.   
Also, the “western” variant includes creating quite a long “cramped” zone between the existing route of the Oktyabrskaya Railway, future motorway and high-speed railway mainline. They say in the Novgorod Oblast Administration that this may require certain measures, up to the removal of populated settlements from this region. Experts from Lengiprotrans say in reply that in such few sections it is possible to include the railway and the motorway in a single technical corridor. 
Experts from Lengiprotrans emphasise that while designing the railway mainline, they used the European and world experience in creating high-speed links. Thus in the beginning of the current year experts from this institute made a trip to Germany with the particular purpose of studying local experience of high-speed railway construction using the example of the high-speed link between Cologne and Frankfurt am Main. “We discovered that Germany and Russia have similar problems in terms of high-speed link creation. For example, our colleagues in Germany have also met difficulties in the sphere of ecology and in coordination with the population when outlining the route from Cologne to Frankfurt am Main,” said Mr Us. As a result, the route was corrected at the stage of project development in order to bypass the motorway and to take all ecological aspects into consideration. 

Land and Railway Station Problems 
The mentioned land problem is the second important one in this complicated project. OAO “High-Speed Railways” management says that the land property inventory procedure has been already fully completed along the whole length of the high-speed railway in its “Novgorod” variant. It has shown that 1,492.88 hectares from the 6831.3 hectares necessary for construction of the line is private property, and 5,338.42 hectares are in the state ownership. By the estimates of institutions involved in this project, the approximate amount of compensatory repayments for the land is 23.3 billion roubles. Some 4.2 billion of this amount will be paid to private owners, and 19.1 billion - to municipalities and subjects of the Russian Federation. Figures were based on cadastral cost and the market factor. Today the state registration of the land that was allocated by the Decree of the President of the Russian Federation for the construction of the high-speed link has been already started. It is obvious that the new route for the railway mainline will cause new reservation of territories, at least in those sections where the new line does not coincide with the old one. According to the Management of OAO “High-Speed Railways,” it is necessary to renew the land registration within 355 km of the way. 
And the last factor in the list of difficulties the designers of the high-speed link meet is the choice of where in St. Petersburg to locate the railway station for the high-speed service. It was traditionally considered that the high-speed line would enter St. Petersburg through the station Obukhovo (the city’s suburb) and then would stretch for 13 km up to the Moskovsky Station. But a new administrative decision was later made, and the city limits have been drawn 28 km away along railway tracks from this station.
Construction of the line on this site was seriously complicated by the presence of numerous highways and engineering communications. Here high-speed railway will demand the building of eight motorway overpasses of total length 2.8 km, six railway overpasses and five bridges. A total of 13 km of the 28 km of this railway going by St. Petersburg territory, will be laid on a raised level. “The decision of where to locate a railway station complex and where the railway line would be laid in the city, required to the study of a great number of variants. After estimating and comparing all the offers, and considering the approvals to occupy additional city territories, the choice was made in favour of the variant to build it above the existing platforms of the Moskovsky Station,” notes Mr Romanov. According to this variant, the high-speed railway would run to the west of the existing line of the Octyabrskaya Railway. The new railway complex and platforms will be placed on the upper level, above the current arrival-departure ways at the station St. Petersburg-Passenger-Moscow in the suburban zone. 
The main depot which will provide service and equipment for high-speed trains will be built in the area of industrial zone Obukhovo, on the earlier reserved territory. According to the project, the new railway terminal building of the mainline will have from 2 to 5 floors on the area of 465х80 m. One of its exits will be connected with an also projected metro station by subway.
This zone will also include a high-speed train technical service centre. It is supposed, that apart from passenger facilities, the multipurpose railway complex will include a hotel complex, trading, tourist, business, commercial and exhibition centres, and also parking. Its total area will be about 450,000 sq.m, and the parking capacity will be 2,500 cars.

The Project Should Be!
It is necessary to note that the today’s plan of building a separated high-speed railway is actually a pilot project which should be a pattern for the further development of high-speed railway links in Russia. However, considering the current financial situation in the sector, a question of when construction will begin and how much it will cost will possibly remain open for a long time. “According to the world building practices, the sites which cost more than $500 million appear in the category of national political sites. The high-speed railway from Moscow to St. Petersburg is estimated in tens billion euro. Therefore the question about the beginning of its construction will be decided by the Government of the Russian Federation,” said Mr Romanov. He also finds it good not to forget, that if this project is never realised, then such a high-speed railway which goes by a specially separated line might never appear in Russia at all. 
Maria Shevchenko 
    [~DETAIL_TEXT] => 
A Monument to the High-Speed Mainline 
There is leader in Russia’s railway sector who has ever managed to realise a speed and high-speed project in this country before, although the prospects for the railway service with speeds of 200 km per hour and more were seriously discussed during sessions of the Council of Ministers in the USSR as long ago as in the 1960s. The fact is that in 1964 Japan built a railway that could hold passenger trains with a speed of 210 km/h. The Soviet Union could not put up with the fact that the country that sent the first man to Space lagged behind in railway transport. The Council of Ministers of the USSR took a decision to start work on a similar national project.  According to the USSR’s high-speed engineering design project, Moscow was planned to be linked by railway line to Leningrad (today St. Petersburg) and the main country’s resorts in the Crimea and the Caucasus. 
It was difficult for the developers to make choose the traction facilities at the very beginning, therefore pilot models of an electric locomotive and an electric train were ordered. During the next ten years, new rolling stock was developing. It was a high-speed electric train (ER-200) in Riga, and a high-speed locomotive ChS-200 in the Czech town of Plzen. Carriages for the Czech locomotive named “Russian Troika” had to be produced by the Kalininsky Carriage-Building Plant in Tver. 
In time this project was stopped, and only ER-200 was added to the railway fleet.  
The decision to revive the project was made only by the end of the 1980s, this time in an abbreviated version. It was decided to organise a high-speed service between Moscow and Leningrad. For this purpose in the beginning of the 1990s a joint-stock company “High-Speed Railways” was created. It was planned to build the railway mainline itself, a transport commercial complex, and to create such a rolling stock which could ply the railroad at a speed of 350 km/h. The new train received the name “Sokol”, and the Central Engineering Design Office “Rubin” was appointed to work it out. A total of 60 scientific, engineering and military defence enterprises were involved in work on this train. But this project never got a chance to be realised. It was closed by 2000 because of economic and financial problems. 
The idea to create high-speed railway started sounding again in the first decade of the 21st century. The Chief Expert from OAO Lengiprotrans Railway Research and Engineering Department, Timur Us, said: “In the 1980s our institute finalised the first feasibility report for the construction of the high-speed railway mainline between two capitals. Fourteen variants of the road were created then. Now we are making a substantiation of the investment in the construction of the chosen project. But essential changes in the national legislation took place after the project research was done in 1992. In particular, requirements were toughened in the sphere of land and ecological certification. As a result, the previously chosen variant was again not the most favourable, not optimal from the point of view of following the legal norms.”

 Heritage of the Past
Institute experts which have been involved in the creation of the general mainline project since the beginning of 2008 have been given a new purpose to create another variant of the route. It had to be an alternative to the route that was chosen in early 1990s and was then named “The Novgorod Direction”. “The issue is that the so-called “Novgorod variant” was chosen as the main one at that time, because it gave an opportunity to a large number of people to move in the shortest time within the historical and cultural triangle between Moscow, Novgorod and St. Petersburg. The high speed mainline had to come up to Novgorod at a distance of 30 km, which allowed Novgorod to be reached by public transport. But considerable changes took place in Russian land law within the next period before 2008,” says the Deputy Chief Engineer of the Lengiprotrans Institute, Vladimir Romanov. In particular, four new protected natural zones were created in the Novgorod area, in addition to the Valdai National Park. Speaking first of all about the National Park “Valdai”, located in the Novgorod area, there the high-speed line runs by 24 km of its land, and then about 2 km of Zavidovo zone; and additionally, other new sites appeared on the earlier planned line’s territory too. Thus, apart from the high-speed railway line, a motorway is being planned between Moscow and St. Petersburg. Its future facilities “borrow” the same territory as the high-speed railway, for which a route had been approved earlier. 
“The main problem with this project is the existence of a large number of highly protected natural reserves in the railway mainline’s corridor, and it is necessary to take them into account. Also problematic is the fact of designing the high-speed motorway between St. Petersburg and Moscow, which is passing too close to the chosen route for the high-speed railway mainline. In this respect we have faced the need to coordinate the parameters of draining system and crossings with local motorways,” emphasised Mr Romanov. It is interesting that, according to current legislation, there is no real opportunity to change the borders of the highly protected natural territories, except for their closing by authorised governmental bodies. Designing linear objects requires detours of such territories, and as consequence, the route will be longer. For example, just the Valdai reserve detour may add extra 43 km to the route. 

The Western Variant: Pro and Contra
As a result, experts from the Lengiprotrans institute had to begin work on the project again, choosing a route for the future line. Mr Romanov says that the following criteria were set up as the basis for the proposed project’s evaluation:
• The line should have such length and parameters, which would allow for a 2.5-hour train run between Moscow and St. Petersburg;
• In terms of structure, the line must give an opportunity to increase speed on the route up to 400 km/h;
• The length of the railway in the protected nature reserves must be reduced as much as possible;
• Volumetric characteristics will be considered, which is the quantity of construction and volume of excavation work for the construction needed.
“The so-called “Western” variant matched these criteria better than seven other variants suggested. It was approved by RZD’s Scientific and Technical Council, which took place in spring 2009,” tells Mr Romanov. So, the high-speed railway mainline goes from St. Petersburg to Valdai almost in parallel with the currently operating fast railroad between St-Petersburg and Moscow, but then it bypasses the main restricted area and comes out on the route of the “Novgorod” variant near the town of Vyshni Volochek. The management of the Lengiprotrans Institute says that such a variant will have better technical and economic parameters than the “Novgorod variant”. Also, it is more advantageous in terms of matching the environmental requirements. 
So, the problem seems to be solved; but this variant of high-speed route has a number of opponents. Thus the management of the Novgorod Oblast paid attention to the fact that the “Novgorod” variant was more attractive in another way – the railroad in this case had to go through the areas where transport communications were currently undeveloped.
The ussue is that the first variant assumed that the mainline would be laid in only 35 km from Novgorod and thus would increase a tourist flow in this region. The new project will bypass this former trading capital of Russia at a distance of 65 km. The same goes for all key recreational zones in that area. The detour of the Valdai National Park is planned in the area of Uglovka station, where the distance between a possible railway station and the touristic and recreational zone would be about 40 km. Experts from Lengiprotrans suggest solving this problem by creating a high-speed railway link along the existing line between Chudovo and Novgorod, which would allow for maintaining a local high-speed service between St. Petersburg and Novgorod in future.   
Also, the “western” variant includes creating quite a long “cramped” zone between the existing route of the Oktyabrskaya Railway, future motorway and high-speed railway mainline. They say in the Novgorod Oblast Administration that this may require certain measures, up to the removal of populated settlements from this region. Experts from Lengiprotrans say in reply that in such few sections it is possible to include the railway and the motorway in a single technical corridor. 
Experts from Lengiprotrans emphasise that while designing the railway mainline, they used the European and world experience in creating high-speed links. Thus in the beginning of the current year experts from this institute made a trip to Germany with the particular purpose of studying local experience of high-speed railway construction using the example of the high-speed link between Cologne and Frankfurt am Main. “We discovered that Germany and Russia have similar problems in terms of high-speed link creation. For example, our colleagues in Germany have also met difficulties in the sphere of ecology and in coordination with the population when outlining the route from Cologne to Frankfurt am Main,” said Mr Us. As a result, the route was corrected at the stage of project development in order to bypass the motorway and to take all ecological aspects into consideration. 

Land and Railway Station Problems 
The mentioned land problem is the second important one in this complicated project. OAO “High-Speed Railways” management says that the land property inventory procedure has been already fully completed along the whole length of the high-speed railway in its “Novgorod” variant. It has shown that 1,492.88 hectares from the 6831.3 hectares necessary for construction of the line is private property, and 5,338.42 hectares are in the state ownership. By the estimates of institutions involved in this project, the approximate amount of compensatory repayments for the land is 23.3 billion roubles. Some 4.2 billion of this amount will be paid to private owners, and 19.1 billion - to municipalities and subjects of the Russian Federation. Figures were based on cadastral cost and the market factor. Today the state registration of the land that was allocated by the Decree of the President of the Russian Federation for the construction of the high-speed link has been already started. It is obvious that the new route for the railway mainline will cause new reservation of territories, at least in those sections where the new line does not coincide with the old one. According to the Management of OAO “High-Speed Railways,” it is necessary to renew the land registration within 355 km of the way. 
And the last factor in the list of difficulties the designers of the high-speed link meet is the choice of where in St. Petersburg to locate the railway station for the high-speed service. It was traditionally considered that the high-speed line would enter St. Petersburg through the station Obukhovo (the city’s suburb) and then would stretch for 13 km up to the Moskovsky Station. But a new administrative decision was later made, and the city limits have been drawn 28 km away along railway tracks from this station.
Construction of the line on this site was seriously complicated by the presence of numerous highways and engineering communications. Here high-speed railway will demand the building of eight motorway overpasses of total length 2.8 km, six railway overpasses and five bridges. A total of 13 km of the 28 km of this railway going by St. Petersburg territory, will be laid on a raised level. “The decision of where to locate a railway station complex and where the railway line would be laid in the city, required to the study of a great number of variants. After estimating and comparing all the offers, and considering the approvals to occupy additional city territories, the choice was made in favour of the variant to build it above the existing platforms of the Moskovsky Station,” notes Mr Romanov. According to this variant, the high-speed railway would run to the west of the existing line of the Octyabrskaya Railway. The new railway complex and platforms will be placed on the upper level, above the current arrival-departure ways at the station St. Petersburg-Passenger-Moscow in the suburban zone. 
The main depot which will provide service and equipment for high-speed trains will be built in the area of industrial zone Obukhovo, on the earlier reserved territory. According to the project, the new railway terminal building of the mainline will have from 2 to 5 floors on the area of 465х80 m. One of its exits will be connected with an also projected metro station by subway.
This zone will also include a high-speed train technical service centre. It is supposed, that apart from passenger facilities, the multipurpose railway complex will include a hotel complex, trading, tourist, business, commercial and exhibition centres, and also parking. Its total area will be about 450,000 sq.m, and the parking capacity will be 2,500 cars.

The Project Should Be!
It is necessary to note that the today’s plan of building a separated high-speed railway is actually a pilot project which should be a pattern for the further development of high-speed railway links in Russia. However, considering the current financial situation in the sector, a question of when construction will begin and how much it will cost will possibly remain open for a long time. “According to the world building practices, the sites which cost more than $500 million appear in the category of national political sites. The high-speed railway from Moscow to St. Petersburg is estimated in tens billion euro. Therefore the question about the beginning of its construction will be decided by the Government of the Russian Federation,” said Mr Romanov. He also finds it good not to forget, that if this project is never realised, then such a high-speed railway which goes by a specially separated line might never appear in Russia at all. 
Maria Shevchenko 
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    [DETAIL_TEXT] => 
A Monument to the High-Speed Mainline 
There is leader in Russia’s railway sector who has ever managed to realise a speed and high-speed project in this country before, although the prospects for the railway service with speeds of 200 km per hour and more were seriously discussed during sessions of the Council of Ministers in the USSR as long ago as in the 1960s. The fact is that in 1964 Japan built a railway that could hold passenger trains with a speed of 210 km/h. The Soviet Union could not put up with the fact that the country that sent the first man to Space lagged behind in railway transport. The Council of Ministers of the USSR took a decision to start work on a similar national project.  According to the USSR’s high-speed engineering design project, Moscow was planned to be linked by railway line to Leningrad (today St. Petersburg) and the main country’s resorts in the Crimea and the Caucasus. 
It was difficult for the developers to make choose the traction facilities at the very beginning, therefore pilot models of an electric locomotive and an electric train were ordered. During the next ten years, new rolling stock was developing. It was a high-speed electric train (ER-200) in Riga, and a high-speed locomotive ChS-200 in the Czech town of Plzen. Carriages for the Czech locomotive named “Russian Troika” had to be produced by the Kalininsky Carriage-Building Plant in Tver. 
In time this project was stopped, and only ER-200 was added to the railway fleet.  
The decision to revive the project was made only by the end of the 1980s, this time in an abbreviated version. It was decided to organise a high-speed service between Moscow and Leningrad. For this purpose in the beginning of the 1990s a joint-stock company “High-Speed Railways” was created. It was planned to build the railway mainline itself, a transport commercial complex, and to create such a rolling stock which could ply the railroad at a speed of 350 km/h. The new train received the name “Sokol”, and the Central Engineering Design Office “Rubin” was appointed to work it out. A total of 60 scientific, engineering and military defence enterprises were involved in work on this train. But this project never got a chance to be realised. It was closed by 2000 because of economic and financial problems. 
The idea to create high-speed railway started sounding again in the first decade of the 21st century. The Chief Expert from OAO Lengiprotrans Railway Research and Engineering Department, Timur Us, said: “In the 1980s our institute finalised the first feasibility report for the construction of the high-speed railway mainline between two capitals. Fourteen variants of the road were created then. Now we are making a substantiation of the investment in the construction of the chosen project. But essential changes in the national legislation took place after the project research was done in 1992. In particular, requirements were toughened in the sphere of land and ecological certification. As a result, the previously chosen variant was again not the most favourable, not optimal from the point of view of following the legal norms.”

 Heritage of the Past
Institute experts which have been involved in the creation of the general mainline project since the beginning of 2008 have been given a new purpose to create another variant of the route. It had to be an alternative to the route that was chosen in early 1990s and was then named “The Novgorod Direction”. “The issue is that the so-called “Novgorod variant” was chosen as the main one at that time, because it gave an opportunity to a large number of people to move in the shortest time within the historical and cultural triangle between Moscow, Novgorod and St. Petersburg. The high speed mainline had to come up to Novgorod at a distance of 30 km, which allowed Novgorod to be reached by public transport. But considerable changes took place in Russian land law within the next period before 2008,” says the Deputy Chief Engineer of the Lengiprotrans Institute, Vladimir Romanov. In particular, four new protected natural zones were created in the Novgorod area, in addition to the Valdai National Park. Speaking first of all about the National Park “Valdai”, located in the Novgorod area, there the high-speed line runs by 24 km of its land, and then about 2 km of Zavidovo zone; and additionally, other new sites appeared on the earlier planned line’s territory too. Thus, apart from the high-speed railway line, a motorway is being planned between Moscow and St. Petersburg. Its future facilities “borrow” the same territory as the high-speed railway, for which a route had been approved earlier. 
“The main problem with this project is the existence of a large number of highly protected natural reserves in the railway mainline’s corridor, and it is necessary to take them into account. Also problematic is the fact of designing the high-speed motorway between St. Petersburg and Moscow, which is passing too close to the chosen route for the high-speed railway mainline. In this respect we have faced the need to coordinate the parameters of draining system and crossings with local motorways,” emphasised Mr Romanov. It is interesting that, according to current legislation, there is no real opportunity to change the borders of the highly protected natural territories, except for their closing by authorised governmental bodies. Designing linear objects requires detours of such territories, and as consequence, the route will be longer. For example, just the Valdai reserve detour may add extra 43 km to the route. 

The Western Variant: Pro and Contra
As a result, experts from the Lengiprotrans institute had to begin work on the project again, choosing a route for the future line. Mr Romanov says that the following criteria were set up as the basis for the proposed project’s evaluation:
• The line should have such length and parameters, which would allow for a 2.5-hour train run between Moscow and St. Petersburg;
• In terms of structure, the line must give an opportunity to increase speed on the route up to 400 km/h;
• The length of the railway in the protected nature reserves must be reduced as much as possible;
• Volumetric characteristics will be considered, which is the quantity of construction and volume of excavation work for the construction needed.
“The so-called “Western” variant matched these criteria better than seven other variants suggested. It was approved by RZD’s Scientific and Technical Council, which took place in spring 2009,” tells Mr Romanov. So, the high-speed railway mainline goes from St. Petersburg to Valdai almost in parallel with the currently operating fast railroad between St-Petersburg and Moscow, but then it bypasses the main restricted area and comes out on the route of the “Novgorod” variant near the town of Vyshni Volochek. The management of the Lengiprotrans Institute says that such a variant will have better technical and economic parameters than the “Novgorod variant”. Also, it is more advantageous in terms of matching the environmental requirements. 
So, the problem seems to be solved; but this variant of high-speed route has a number of opponents. Thus the management of the Novgorod Oblast paid attention to the fact that the “Novgorod” variant was more attractive in another way – the railroad in this case had to go through the areas where transport communications were currently undeveloped.
The ussue is that the first variant assumed that the mainline would be laid in only 35 km from Novgorod and thus would increase a tourist flow in this region. The new project will bypass this former trading capital of Russia at a distance of 65 km. The same goes for all key recreational zones in that area. The detour of the Valdai National Park is planned in the area of Uglovka station, where the distance between a possible railway station and the touristic and recreational zone would be about 40 km. Experts from Lengiprotrans suggest solving this problem by creating a high-speed railway link along the existing line between Chudovo and Novgorod, which would allow for maintaining a local high-speed service between St. Petersburg and Novgorod in future.   
Also, the “western” variant includes creating quite a long “cramped” zone between the existing route of the Oktyabrskaya Railway, future motorway and high-speed railway mainline. They say in the Novgorod Oblast Administration that this may require certain measures, up to the removal of populated settlements from this region. Experts from Lengiprotrans say in reply that in such few sections it is possible to include the railway and the motorway in a single technical corridor. 
Experts from Lengiprotrans emphasise that while designing the railway mainline, they used the European and world experience in creating high-speed links. Thus in the beginning of the current year experts from this institute made a trip to Germany with the particular purpose of studying local experience of high-speed railway construction using the example of the high-speed link between Cologne and Frankfurt am Main. “We discovered that Germany and Russia have similar problems in terms of high-speed link creation. For example, our colleagues in Germany have also met difficulties in the sphere of ecology and in coordination with the population when outlining the route from Cologne to Frankfurt am Main,” said Mr Us. As a result, the route was corrected at the stage of project development in order to bypass the motorway and to take all ecological aspects into consideration. 

Land and Railway Station Problems 
The mentioned land problem is the second important one in this complicated project. OAO “High-Speed Railways” management says that the land property inventory procedure has been already fully completed along the whole length of the high-speed railway in its “Novgorod” variant. It has shown that 1,492.88 hectares from the 6831.3 hectares necessary for construction of the line is private property, and 5,338.42 hectares are in the state ownership. By the estimates of institutions involved in this project, the approximate amount of compensatory repayments for the land is 23.3 billion roubles. Some 4.2 billion of this amount will be paid to private owners, and 19.1 billion - to municipalities and subjects of the Russian Federation. Figures were based on cadastral cost and the market factor. Today the state registration of the land that was allocated by the Decree of the President of the Russian Federation for the construction of the high-speed link has been already started. It is obvious that the new route for the railway mainline will cause new reservation of territories, at least in those sections where the new line does not coincide with the old one. According to the Management of OAO “High-Speed Railways,” it is necessary to renew the land registration within 355 km of the way. 
And the last factor in the list of difficulties the designers of the high-speed link meet is the choice of where in St. Petersburg to locate the railway station for the high-speed service. It was traditionally considered that the high-speed line would enter St. Petersburg through the station Obukhovo (the city’s suburb) and then would stretch for 13 km up to the Moskovsky Station. But a new administrative decision was later made, and the city limits have been drawn 28 km away along railway tracks from this station.
Construction of the line on this site was seriously complicated by the presence of numerous highways and engineering communications. Here high-speed railway will demand the building of eight motorway overpasses of total length 2.8 km, six railway overpasses and five bridges. A total of 13 km of the 28 km of this railway going by St. Petersburg territory, will be laid on a raised level. “The decision of where to locate a railway station complex and where the railway line would be laid in the city, required to the study of a great number of variants. After estimating and comparing all the offers, and considering the approvals to occupy additional city territories, the choice was made in favour of the variant to build it above the existing platforms of the Moskovsky Station,” notes Mr Romanov. According to this variant, the high-speed railway would run to the west of the existing line of the Octyabrskaya Railway. The new railway complex and platforms will be placed on the upper level, above the current arrival-departure ways at the station St. Petersburg-Passenger-Moscow in the suburban zone. 
The main depot which will provide service and equipment for high-speed trains will be built in the area of industrial zone Obukhovo, on the earlier reserved territory. According to the project, the new railway terminal building of the mainline will have from 2 to 5 floors on the area of 465х80 m. One of its exits will be connected with an also projected metro station by subway.
This zone will also include a high-speed train technical service centre. It is supposed, that apart from passenger facilities, the multipurpose railway complex will include a hotel complex, trading, tourist, business, commercial and exhibition centres, and also parking. Its total area will be about 450,000 sq.m, and the parking capacity will be 2,500 cars.

The Project Should Be!
It is necessary to note that the today’s plan of building a separated high-speed railway is actually a pilot project which should be a pattern for the further development of high-speed railway links in Russia. However, considering the current financial situation in the sector, a question of when construction will begin and how much it will cost will possibly remain open for a long time. “According to the world building practices, the sites which cost more than $500 million appear in the category of national political sites. The high-speed railway from Moscow to St. Petersburg is estimated in tens billion euro. Therefore the question about the beginning of its construction will be decided by the Government of the Russian Federation,” said Mr Romanov. He also finds it good not to forget, that if this project is never realised, then such a high-speed railway which goes by a specially separated line might never appear in Russia at all. 
Maria Shevchenko 
    [~DETAIL_TEXT] => 
A Monument to the High-Speed Mainline 
There is leader in Russia’s railway sector who has ever managed to realise a speed and high-speed project in this country before, although the prospects for the railway service with speeds of 200 km per hour and more were seriously discussed during sessions of the Council of Ministers in the USSR as long ago as in the 1960s. The fact is that in 1964 Japan built a railway that could hold passenger trains with a speed of 210 km/h. The Soviet Union could not put up with the fact that the country that sent the first man to Space lagged behind in railway transport. The Council of Ministers of the USSR took a decision to start work on a similar national project.  According to the USSR’s high-speed engineering design project, Moscow was planned to be linked by railway line to Leningrad (today St. Petersburg) and the main country’s resorts in the Crimea and the Caucasus. 
It was difficult for the developers to make choose the traction facilities at the very beginning, therefore pilot models of an electric locomotive and an electric train were ordered. During the next ten years, new rolling stock was developing. It was a high-speed electric train (ER-200) in Riga, and a high-speed locomotive ChS-200 in the Czech town of Plzen. Carriages for the Czech locomotive named “Russian Troika” had to be produced by the Kalininsky Carriage-Building Plant in Tver. 
In time this project was stopped, and only ER-200 was added to the railway fleet.  
The decision to revive the project was made only by the end of the 1980s, this time in an abbreviated version. It was decided to organise a high-speed service between Moscow and Leningrad. For this purpose in the beginning of the 1990s a joint-stock company “High-Speed Railways” was created. It was planned to build the railway mainline itself, a transport commercial complex, and to create such a rolling stock which could ply the railroad at a speed of 350 km/h. The new train received the name “Sokol”, and the Central Engineering Design Office “Rubin” was appointed to work it out. A total of 60 scientific, engineering and military defence enterprises were involved in work on this train. But this project never got a chance to be realised. It was closed by 2000 because of economic and financial problems. 
The idea to create high-speed railway started sounding again in the first decade of the 21st century. The Chief Expert from OAO Lengiprotrans Railway Research and Engineering Department, Timur Us, said: “In the 1980s our institute finalised the first feasibility report for the construction of the high-speed railway mainline between two capitals. Fourteen variants of the road were created then. Now we are making a substantiation of the investment in the construction of the chosen project. But essential changes in the national legislation took place after the project research was done in 1992. In particular, requirements were toughened in the sphere of land and ecological certification. As a result, the previously chosen variant was again not the most favourable, not optimal from the point of view of following the legal norms.”

 Heritage of the Past
Institute experts which have been involved in the creation of the general mainline project since the beginning of 2008 have been given a new purpose to create another variant of the route. It had to be an alternative to the route that was chosen in early 1990s and was then named “The Novgorod Direction”. “The issue is that the so-called “Novgorod variant” was chosen as the main one at that time, because it gave an opportunity to a large number of people to move in the shortest time within the historical and cultural triangle between Moscow, Novgorod and St. Petersburg. The high speed mainline had to come up to Novgorod at a distance of 30 km, which allowed Novgorod to be reached by public transport. But considerable changes took place in Russian land law within the next period before 2008,” says the Deputy Chief Engineer of the Lengiprotrans Institute, Vladimir Romanov. In particular, four new protected natural zones were created in the Novgorod area, in addition to the Valdai National Park. Speaking first of all about the National Park “Valdai”, located in the Novgorod area, there the high-speed line runs by 24 km of its land, and then about 2 km of Zavidovo zone; and additionally, other new sites appeared on the earlier planned line’s territory too. Thus, apart from the high-speed railway line, a motorway is being planned between Moscow and St. Petersburg. Its future facilities “borrow” the same territory as the high-speed railway, for which a route had been approved earlier. 
“The main problem with this project is the existence of a large number of highly protected natural reserves in the railway mainline’s corridor, and it is necessary to take them into account. Also problematic is the fact of designing the high-speed motorway between St. Petersburg and Moscow, which is passing too close to the chosen route for the high-speed railway mainline. In this respect we have faced the need to coordinate the parameters of draining system and crossings with local motorways,” emphasised Mr Romanov. It is interesting that, according to current legislation, there is no real opportunity to change the borders of the highly protected natural territories, except for their closing by authorised governmental bodies. Designing linear objects requires detours of such territories, and as consequence, the route will be longer. For example, just the Valdai reserve detour may add extra 43 km to the route. 

The Western Variant: Pro and Contra
As a result, experts from the Lengiprotrans institute had to begin work on the project again, choosing a route for the future line. Mr Romanov says that the following criteria were set up as the basis for the proposed project’s evaluation:
• The line should have such length and parameters, which would allow for a 2.5-hour train run between Moscow and St. Petersburg;
• In terms of structure, the line must give an opportunity to increase speed on the route up to 400 km/h;
• The length of the railway in the protected nature reserves must be reduced as much as possible;
• Volumetric characteristics will be considered, which is the quantity of construction and volume of excavation work for the construction needed.
“The so-called “Western” variant matched these criteria better than seven other variants suggested. It was approved by RZD’s Scientific and Technical Council, which took place in spring 2009,” tells Mr Romanov. So, the high-speed railway mainline goes from St. Petersburg to Valdai almost in parallel with the currently operating fast railroad between St-Petersburg and Moscow, but then it bypasses the main restricted area and comes out on the route of the “Novgorod” variant near the town of Vyshni Volochek. The management of the Lengiprotrans Institute says that such a variant will have better technical and economic parameters than the “Novgorod variant”. Also, it is more advantageous in terms of matching the environmental requirements. 
So, the problem seems to be solved; but this variant of high-speed route has a number of opponents. Thus the management of the Novgorod Oblast paid attention to the fact that the “Novgorod” variant was more attractive in another way – the railroad in this case had to go through the areas where transport communications were currently undeveloped.
The ussue is that the first variant assumed that the mainline would be laid in only 35 km from Novgorod and thus would increase a tourist flow in this region. The new project will bypass this former trading capital of Russia at a distance of 65 km. The same goes for all key recreational zones in that area. The detour of the Valdai National Park is planned in the area of Uglovka station, where the distance between a possible railway station and the touristic and recreational zone would be about 40 km. Experts from Lengiprotrans suggest solving this problem by creating a high-speed railway link along the existing line between Chudovo and Novgorod, which would allow for maintaining a local high-speed service between St. Petersburg and Novgorod in future.   
Also, the “western” variant includes creating quite a long “cramped” zone between the existing route of the Oktyabrskaya Railway, future motorway and high-speed railway mainline. They say in the Novgorod Oblast Administration that this may require certain measures, up to the removal of populated settlements from this region. Experts from Lengiprotrans say in reply that in such few sections it is possible to include the railway and the motorway in a single technical corridor. 
Experts from Lengiprotrans emphasise that while designing the railway mainline, they used the European and world experience in creating high-speed links. Thus in the beginning of the current year experts from this institute made a trip to Germany with the particular purpose of studying local experience of high-speed railway construction using the example of the high-speed link between Cologne and Frankfurt am Main. “We discovered that Germany and Russia have similar problems in terms of high-speed link creation. For example, our colleagues in Germany have also met difficulties in the sphere of ecology and in coordination with the population when outlining the route from Cologne to Frankfurt am Main,” said Mr Us. As a result, the route was corrected at the stage of project development in order to bypass the motorway and to take all ecological aspects into consideration. 

Land and Railway Station Problems 
The mentioned land problem is the second important one in this complicated project. OAO “High-Speed Railways” management says that the land property inventory procedure has been already fully completed along the whole length of the high-speed railway in its “Novgorod” variant. It has shown that 1,492.88 hectares from the 6831.3 hectares necessary for construction of the line is private property, and 5,338.42 hectares are in the state ownership. By the estimates of institutions involved in this project, the approximate amount of compensatory repayments for the land is 23.3 billion roubles. Some 4.2 billion of this amount will be paid to private owners, and 19.1 billion - to municipalities and subjects of the Russian Federation. Figures were based on cadastral cost and the market factor. Today the state registration of the land that was allocated by the Decree of the President of the Russian Federation for the construction of the high-speed link has been already started. It is obvious that the new route for the railway mainline will cause new reservation of territories, at least in those sections where the new line does not coincide with the old one. According to the Management of OAO “High-Speed Railways,” it is necessary to renew the land registration within 355 km of the way. 
And the last factor in the list of difficulties the designers of the high-speed link meet is the choice of where in St. Petersburg to locate the railway station for the high-speed service. It was traditionally considered that the high-speed line would enter St. Petersburg through the station Obukhovo (the city’s suburb) and then would stretch for 13 km up to the Moskovsky Station. But a new administrative decision was later made, and the city limits have been drawn 28 km away along railway tracks from this station.
Construction of the line on this site was seriously complicated by the presence of numerous highways and engineering communications. Here high-speed railway will demand the building of eight motorway overpasses of total length 2.8 km, six railway overpasses and five bridges. A total of 13 km of the 28 km of this railway going by St. Petersburg territory, will be laid on a raised level. “The decision of where to locate a railway station complex and where the railway line would be laid in the city, required to the study of a great number of variants. After estimating and comparing all the offers, and considering the approvals to occupy additional city territories, the choice was made in favour of the variant to build it above the existing platforms of the Moskovsky Station,” notes Mr Romanov. According to this variant, the high-speed railway would run to the west of the existing line of the Octyabrskaya Railway. The new railway complex and platforms will be placed on the upper level, above the current arrival-departure ways at the station St. Petersburg-Passenger-Moscow in the suburban zone. 
The main depot which will provide service and equipment for high-speed trains will be built in the area of industrial zone Obukhovo, on the earlier reserved territory. According to the project, the new railway terminal building of the mainline will have from 2 to 5 floors on the area of 465х80 m. One of its exits will be connected with an also projected metro station by subway.
This zone will also include a high-speed train technical service centre. It is supposed, that apart from passenger facilities, the multipurpose railway complex will include a hotel complex, trading, tourist, business, commercial and exhibition centres, and also parking. Its total area will be about 450,000 sq.m, and the parking capacity will be 2,500 cars.

The Project Should Be!
It is necessary to note that the today’s plan of building a separated high-speed railway is actually a pilot project which should be a pattern for the further development of high-speed railway links in Russia. However, considering the current financial situation in the sector, a question of when construction will begin and how much it will cost will possibly remain open for a long time. “According to the world building practices, the sites which cost more than $500 million appear in the category of national political sites. The high-speed railway from Moscow to St. Petersburg is estimated in tens billion euro. Therefore the question about the beginning of its construction will be decided by the Government of the Russian Federation,” said Mr Romanov. He also finds it good not to forget, that if this project is never realised, then such a high-speed railway which goes by a specially separated line might never appear in Russia at all. 
Maria Shevchenko 
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Interoperability is on the agenda
– Mr Shozda, what aspects of the organisation’s activity are priorities now?
– First of all, comes development and improvement of international railway transportation, especially between Europe and Asia, including piggy-backing. I should also mention creation of a coordinated transport policy in the sector of international railway transportation and development of the strategy for railways’ work and the OSJD’s activity. The improvement of international transport legislation is important too, including the Agreement on International Passenger Transportation (SMPS), the Agreement on International Goods Transport by Rail (SMGS), and other legal documents relating to international transportation by railway. We continue to pay special attention to cooperation targeted at solving problems in economic, information, scientific, technical, and ecological aspects of railway work as well as development of measures to improve the competitiveness of this transport mode. Also, we cooperate in the sector of exploitation of railways and technical issues concerning further development of international railway transportation. In addition, the OSJD interacts with international organisations working in the railway sector, including those specialising in piggy-backing.
– How does the OSJD cooperate with other railway organisations? 
– We actively cooperate with practically all international railway transport organisations on the territory of Eurasia. Together, we discuss the issues of border crossing, legal harmonisation of CIM/SMGS, including implementation and improvement of the unified consignment note CIM/SMGS, single digital coding and creation of a single database of railways, interoperability of railway systems, which have 1520 mm (1524 mm in Finland) and 1435 mm -- wide gauges; development of railway transportation on the territory of Eurasia. In cooperation with many of them we have created working groups to find solutions for all aspects of our activity.

Let the UN control the problem of border crossing!
– Is there any progress in reaching the target of simplifying border crossing procedures?
– There are almost 200 railway border crossings in the countries, which are members of the OSJD. Practically each one has its own peculiarities and problems. The OSJD, in cooperation with the International Union of Railways (UIC), has considered these issues for several years. As a result, a number of recommendations, measures, conclusions, and suggestions were made, and most of them have been implemented. Meanwhile, analysis shows that these measures are not enough, because railway organisations cannot solve some of the problems --those which are within the governments’ competence. That is why the Committee of the OSJD offered to discuss the problem under the aegis of the UN at an international conference devoted to simplifying border crossing procedures, in which representatives of governments, border and customs departments, and railway companies would participate. This initiative was supported. Drafts of the Annexe 9 to the Convention on cargo control at borders and a new Convention on passenger train control have been developed, as well as a plan for measures and some other documents. The target is to hold this conference successfully, and to attract the attention of the governments of the UN member states to the existing problems so as to solve them. I have to say that the OSJD has done a lot for the cause. For example, more than a decade we worked to develop the Convention on international customs transit procedure at cargo transportation by railway using SMGS consignment. Now the Convention is ready. We’d like the member states of the OSJD to ratify the document as soon as possible. Its application for international freight transportation would simplify the process of border crossing for transit cargo significantly.
– Could you tell us more about the problem with the two acting legal systems regulating cargo transportation: SMGS and COTIF?
– This issue is especially important for the liberalisation of export and import cargo flows. Two legal systems – SMGS and Convention concerning international carriage by rail (COTIF) – regulate international cargo transportation between East and West. Freight transportation using two legal documents creates a number of inconveniences for clients and transporters, since it requires obligatory re-issuing of transport documents when transferring from one system of transport legislation to another. Naturally, it leads to long-term delays in cargo delivery and additional expenses. Errors often appear when  documents are re-issued, which take a lot of time to resolve. For this reason, one of the major aspects of our work is development of a new universal consignment note meeting Uniform Rules concerning the Contract for International Carriage of Goods by Rail (CIM) as well as SMGS. This target could be reached only if specialists from the OSJD and the International Rail Transport Committee (CIT) cooperate closely. As a result of their work, a single universal consignment note CIM/SMGS and a manual were created. A pilot train loaded with ferrous metal ran from Ukraine to Germany in July 2006. Its weight was 1,120 tons. It crossed the border between Ukraine and Poland without transport documents being re-issued. Thus, the advantages of the new consignment note were demonstrated. Now the system is being used successfully for railway transportation across Russia, Ukraine, Slovakia, Poland, Byelorussia and a number of other countries. In my opinion, development and implementation of a universal consignment note is just the first step to harmonising the two legal systems. I am sure this target will be reached sooner or later. In 2006, the OSJD started to revise documents concerning SMGS and SMPS they took into account the current market relations and structural and organisational changes that took place on the railways of the OSJD member states.

How do we improve the competitiveness of railways?
- One of the main prerequisites for increasing the volume of transit transportation is an optimal tariff policy, which would satisfy all the participants in the transport process…
– This is a very complicated problem, but it must be nevertheless solved… A compromise should be reached. Otherwise everyone will lose. I’d like to discuss one aspect of this problem. Everyone knows that the transportation price includes the infrastructure cost, but its share is different for different transport modes. It amounts to 30-35% for railway, 5-10% for automobile transport, and 2-3% for sea transport. Obviously, the railway sector operates in worse conditions, while motorways, especially in Europe, are loaded with heavy vehicles carrying cargo. Traffic jams often appear and people suffer the resulting pollution. Meanwhile, the railway lines parallel to the motorways are underloaded. The situation is depressing. Is there any way out? We are convinced that railways and international rail organisations – such as the OSJD, the Intergovernmental Organisation for International Carriage by Rail (OTIF) and the UIC – should examine the situation and make a joint report for the governments of all the countries involved and that the UN should stimulate adoption of laws and arrangements envisaging re-direction of a part of the cargo flow from road to rail. It includes implementation of a special fee to be paid by owners of cargo road transport for using international motorways, a special tax system, and state grants.
It will make motorways safer and less loaded, improve the environment, and save money instead of spending it on building or widening motorways (one kilometre of motorway costs RUR 10-15 million). If a part of the cargo flow is redirected to railways, more regular block trains will be launched. Nowadays, 4-7 days are necessary to accumulate enough cargo for one route train. If there is enough cargo flow, several block trains could run daily. Naturally, the price for transportation would be lower. All these issues are connected with the problem of making railways more competitive.
– What is preventing the development of freight transportation, including container and contrailer use, between the Far East, China, and Europe?
– Analysis of transportation in the OSJD member states shows that cargo transportation volumes are growing every year, but not equally, and experts at the OSJD think that not all opportunities have been used. There are some barriers preventing international cargo transportation, i.e. border problems, flaws in infrastructure in some sectors of railway corridors, the existence of two legal systems regulating transportation, and unclear and unadjusted tariff policies. All these, among others, make railways less competitive. That is why a strategic target of the OSJD is to find a way, and then take measures to improve the competitiveness of railway transport. The OSJD member states have made a lot of progress: they have improved and modernised the infrastructure of all thirteen corridors of the OSJD, revised SMGS and SMPS agreements and taken measures to simplify border crossing procedures. Also, the Convention on international customs transit procedures for cargo transportation by railway using SMGS consignment has been approved. If the member states, including Russia, adopt and ratify it, border crossing procedures will take less time.

Don’t worry, be happy!
– Has the crisis influenced the results of railway transportation in the OSJD member states? 
– Recently we got a lot of reports that there was a decline in passenger and cargo transportation volumes on some railways. I cannot quote  specific figures because we will only receive the official transportation data for 2008 in September 2009. But, according to preliminary data, in February 2009, for example, the volume of cargo carried via the infrastructure of the Estonian railway dropped by 11% year-on-year.
In spite of the crisis, the transport figures for 2008 were positive in many OSJD member states. According to OAO RZD, in January-December 2008, 1.3 billion tons of cargo was loaded onto the Russian railway network, which is 97% of the volume loaded in 2007. Throughput grew by 5% to 2.42 trillion tariff tonne-kilometre. Also, it was the first year that the company’s revenue from core activities exceeded one trillion roubles. Loading of the most important public cargoes increased: coal (+3.8%), machines and equipment (+6.4%). Container transportation via the railways of Kazakhstan grew by 30-35% on average.
These and other data show that there are some difficulties, but they are not fatal. Owing to the flexible and reasonable policy of the railway administrations of the OSJD member states, we succeed in maintaining the level of total transportation volumes and continue to carry out our projects. For example, the prices for some services on international passenger trains in Russia, Belarus, Poland, China and other countries were fixed, and now they do not depend on the euro or dollar rate. This attracted passengers to railway transport and improved the competitiveness of railway passenger transportation in comparison with other transport modes, where prices depend on the currency rate. And high-speed railway construction projects are being carried out in Russia and China.
At the end of the interview, I would like to emphasise the importance of the coordinated work of all specialists in international railway transportation, targeted at development and further improvement of this important sector and better interaction between the railways of Europe and Asia. 
Sergey Kabenkov
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Interoperability is on the agenda
– Mr Shozda, what aspects of the organisation’s activity are priorities now?
– First of all, comes development and improvement of international railway transportation, especially between Europe and Asia, including piggy-backing. I should also mention creation of a coordinated transport policy in the sector of international railway transportation and development of the strategy for railways’ work and the OSJD’s activity. The improvement of international transport legislation is important too, including the Agreement on International Passenger Transportation (SMPS), the Agreement on International Goods Transport by Rail (SMGS), and other legal documents relating to international transportation by railway. We continue to pay special attention to cooperation targeted at solving problems in economic, information, scientific, technical, and ecological aspects of railway work as well as development of measures to improve the competitiveness of this transport mode. Also, we cooperate in the sector of exploitation of railways and technical issues concerning further development of international railway transportation. In addition, the OSJD interacts with international organisations working in the railway sector, including those specialising in piggy-backing.
– How does the OSJD cooperate with other railway organisations? 
– We actively cooperate with practically all international railway transport organisations on the territory of Eurasia. Together, we discuss the issues of border crossing, legal harmonisation of CIM/SMGS, including implementation and improvement of the unified consignment note CIM/SMGS, single digital coding and creation of a single database of railways, interoperability of railway systems, which have 1520 mm (1524 mm in Finland) and 1435 mm -- wide gauges; development of railway transportation on the territory of Eurasia. In cooperation with many of them we have created working groups to find solutions for all aspects of our activity.

Let the UN control the problem of border crossing!
– Is there any progress in reaching the target of simplifying border crossing procedures?
– There are almost 200 railway border crossings in the countries, which are members of the OSJD. Practically each one has its own peculiarities and problems. The OSJD, in cooperation with the International Union of Railways (UIC), has considered these issues for several years. As a result, a number of recommendations, measures, conclusions, and suggestions were made, and most of them have been implemented. Meanwhile, analysis shows that these measures are not enough, because railway organisations cannot solve some of the problems --those which are within the governments’ competence. That is why the Committee of the OSJD offered to discuss the problem under the aegis of the UN at an international conference devoted to simplifying border crossing procedures, in which representatives of governments, border and customs departments, and railway companies would participate. This initiative was supported. Drafts of the Annexe 9 to the Convention on cargo control at borders and a new Convention on passenger train control have been developed, as well as a plan for measures and some other documents. The target is to hold this conference successfully, and to attract the attention of the governments of the UN member states to the existing problems so as to solve them. I have to say that the OSJD has done a lot for the cause. For example, more than a decade we worked to develop the Convention on international customs transit procedure at cargo transportation by railway using SMGS consignment. Now the Convention is ready. We’d like the member states of the OSJD to ratify the document as soon as possible. Its application for international freight transportation would simplify the process of border crossing for transit cargo significantly.
– Could you tell us more about the problem with the two acting legal systems regulating cargo transportation: SMGS and COTIF?
– This issue is especially important for the liberalisation of export and import cargo flows. Two legal systems – SMGS and Convention concerning international carriage by rail (COTIF) – regulate international cargo transportation between East and West. Freight transportation using two legal documents creates a number of inconveniences for clients and transporters, since it requires obligatory re-issuing of transport documents when transferring from one system of transport legislation to another. Naturally, it leads to long-term delays in cargo delivery and additional expenses. Errors often appear when  documents are re-issued, which take a lot of time to resolve. For this reason, one of the major aspects of our work is development of a new universal consignment note meeting Uniform Rules concerning the Contract for International Carriage of Goods by Rail (CIM) as well as SMGS. This target could be reached only if specialists from the OSJD and the International Rail Transport Committee (CIT) cooperate closely. As a result of their work, a single universal consignment note CIM/SMGS and a manual were created. A pilot train loaded with ferrous metal ran from Ukraine to Germany in July 2006. Its weight was 1,120 tons. It crossed the border between Ukraine and Poland without transport documents being re-issued. Thus, the advantages of the new consignment note were demonstrated. Now the system is being used successfully for railway transportation across Russia, Ukraine, Slovakia, Poland, Byelorussia and a number of other countries. In my opinion, development and implementation of a universal consignment note is just the first step to harmonising the two legal systems. I am sure this target will be reached sooner or later. In 2006, the OSJD started to revise documents concerning SMGS and SMPS they took into account the current market relations and structural and organisational changes that took place on the railways of the OSJD member states.

How do we improve the competitiveness of railways?
- One of the main prerequisites for increasing the volume of transit transportation is an optimal tariff policy, which would satisfy all the participants in the transport process…
– This is a very complicated problem, but it must be nevertheless solved… A compromise should be reached. Otherwise everyone will lose. I’d like to discuss one aspect of this problem. Everyone knows that the transportation price includes the infrastructure cost, but its share is different for different transport modes. It amounts to 30-35% for railway, 5-10% for automobile transport, and 2-3% for sea transport. Obviously, the railway sector operates in worse conditions, while motorways, especially in Europe, are loaded with heavy vehicles carrying cargo. Traffic jams often appear and people suffer the resulting pollution. Meanwhile, the railway lines parallel to the motorways are underloaded. The situation is depressing. Is there any way out? We are convinced that railways and international rail organisations – such as the OSJD, the Intergovernmental Organisation for International Carriage by Rail (OTIF) and the UIC – should examine the situation and make a joint report for the governments of all the countries involved and that the UN should stimulate adoption of laws and arrangements envisaging re-direction of a part of the cargo flow from road to rail. It includes implementation of a special fee to be paid by owners of cargo road transport for using international motorways, a special tax system, and state grants.
It will make motorways safer and less loaded, improve the environment, and save money instead of spending it on building or widening motorways (one kilometre of motorway costs RUR 10-15 million). If a part of the cargo flow is redirected to railways, more regular block trains will be launched. Nowadays, 4-7 days are necessary to accumulate enough cargo for one route train. If there is enough cargo flow, several block trains could run daily. Naturally, the price for transportation would be lower. All these issues are connected with the problem of making railways more competitive.
– What is preventing the development of freight transportation, including container and contrailer use, between the Far East, China, and Europe?
– Analysis of transportation in the OSJD member states shows that cargo transportation volumes are growing every year, but not equally, and experts at the OSJD think that not all opportunities have been used. There are some barriers preventing international cargo transportation, i.e. border problems, flaws in infrastructure in some sectors of railway corridors, the existence of two legal systems regulating transportation, and unclear and unadjusted tariff policies. All these, among others, make railways less competitive. That is why a strategic target of the OSJD is to find a way, and then take measures to improve the competitiveness of railway transport. The OSJD member states have made a lot of progress: they have improved and modernised the infrastructure of all thirteen corridors of the OSJD, revised SMGS and SMPS agreements and taken measures to simplify border crossing procedures. Also, the Convention on international customs transit procedures for cargo transportation by railway using SMGS consignment has been approved. If the member states, including Russia, adopt and ratify it, border crossing procedures will take less time.

Don’t worry, be happy!
– Has the crisis influenced the results of railway transportation in the OSJD member states? 
– Recently we got a lot of reports that there was a decline in passenger and cargo transportation volumes on some railways. I cannot quote  specific figures because we will only receive the official transportation data for 2008 in September 2009. But, according to preliminary data, in February 2009, for example, the volume of cargo carried via the infrastructure of the Estonian railway dropped by 11% year-on-year.
In spite of the crisis, the transport figures for 2008 were positive in many OSJD member states. According to OAO RZD, in January-December 2008, 1.3 billion tons of cargo was loaded onto the Russian railway network, which is 97% of the volume loaded in 2007. Throughput grew by 5% to 2.42 trillion tariff tonne-kilometre. Also, it was the first year that the company’s revenue from core activities exceeded one trillion roubles. Loading of the most important public cargoes increased: coal (+3.8%), machines and equipment (+6.4%). Container transportation via the railways of Kazakhstan grew by 30-35% on average.
These and other data show that there are some difficulties, but they are not fatal. Owing to the flexible and reasonable policy of the railway administrations of the OSJD member states, we succeed in maintaining the level of total transportation volumes and continue to carry out our projects. For example, the prices for some services on international passenger trains in Russia, Belarus, Poland, China and other countries were fixed, and now they do not depend on the euro or dollar rate. This attracted passengers to railway transport and improved the competitiveness of railway passenger transportation in comparison with other transport modes, where prices depend on the currency rate. And high-speed railway construction projects are being carried out in Russia and China.
At the end of the interview, I would like to emphasise the importance of the coordinated work of all specialists in international railway transportation, targeted at development and further improvement of this important sector and better interaction between the railways of Europe and Asia. 
Sergey Kabenkov
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Interoperability is on the agenda
– Mr Shozda, what aspects of the organisation’s activity are priorities now?
– First of all, comes development and improvement of international railway transportation, especially between Europe and Asia, including piggy-backing. I should also mention creation of a coordinated transport policy in the sector of international railway transportation and development of the strategy for railways’ work and the OSJD’s activity. The improvement of international transport legislation is important too, including the Agreement on International Passenger Transportation (SMPS), the Agreement on International Goods Transport by Rail (SMGS), and other legal documents relating to international transportation by railway. We continue to pay special attention to cooperation targeted at solving problems in economic, information, scientific, technical, and ecological aspects of railway work as well as development of measures to improve the competitiveness of this transport mode. Also, we cooperate in the sector of exploitation of railways and technical issues concerning further development of international railway transportation. In addition, the OSJD interacts with international organisations working in the railway sector, including those specialising in piggy-backing.
– How does the OSJD cooperate with other railway organisations? 
– We actively cooperate with practically all international railway transport organisations on the territory of Eurasia. Together, we discuss the issues of border crossing, legal harmonisation of CIM/SMGS, including implementation and improvement of the unified consignment note CIM/SMGS, single digital coding and creation of a single database of railways, interoperability of railway systems, which have 1520 mm (1524 mm in Finland) and 1435 mm -- wide gauges; development of railway transportation on the territory of Eurasia. In cooperation with many of them we have created working groups to find solutions for all aspects of our activity.

Let the UN control the problem of border crossing!
– Is there any progress in reaching the target of simplifying border crossing procedures?
– There are almost 200 railway border crossings in the countries, which are members of the OSJD. Practically each one has its own peculiarities and problems. The OSJD, in cooperation with the International Union of Railways (UIC), has considered these issues for several years. As a result, a number of recommendations, measures, conclusions, and suggestions were made, and most of them have been implemented. Meanwhile, analysis shows that these measures are not enough, because railway organisations cannot solve some of the problems --those which are within the governments’ competence. That is why the Committee of the OSJD offered to discuss the problem under the aegis of the UN at an international conference devoted to simplifying border crossing procedures, in which representatives of governments, border and customs departments, and railway companies would participate. This initiative was supported. Drafts of the Annexe 9 to the Convention on cargo control at borders and a new Convention on passenger train control have been developed, as well as a plan for measures and some other documents. The target is to hold this conference successfully, and to attract the attention of the governments of the UN member states to the existing problems so as to solve them. I have to say that the OSJD has done a lot for the cause. For example, more than a decade we worked to develop the Convention on international customs transit procedure at cargo transportation by railway using SMGS consignment. Now the Convention is ready. We’d like the member states of the OSJD to ratify the document as soon as possible. Its application for international freight transportation would simplify the process of border crossing for transit cargo significantly.
– Could you tell us more about the problem with the two acting legal systems regulating cargo transportation: SMGS and COTIF?
– This issue is especially important for the liberalisation of export and import cargo flows. Two legal systems – SMGS and Convention concerning international carriage by rail (COTIF) – regulate international cargo transportation between East and West. Freight transportation using two legal documents creates a number of inconveniences for clients and transporters, since it requires obligatory re-issuing of transport documents when transferring from one system of transport legislation to another. Naturally, it leads to long-term delays in cargo delivery and additional expenses. Errors often appear when  documents are re-issued, which take a lot of time to resolve. For this reason, one of the major aspects of our work is development of a new universal consignment note meeting Uniform Rules concerning the Contract for International Carriage of Goods by Rail (CIM) as well as SMGS. This target could be reached only if specialists from the OSJD and the International Rail Transport Committee (CIT) cooperate closely. As a result of their work, a single universal consignment note CIM/SMGS and a manual were created. A pilot train loaded with ferrous metal ran from Ukraine to Germany in July 2006. Its weight was 1,120 tons. It crossed the border between Ukraine and Poland without transport documents being re-issued. Thus, the advantages of the new consignment note were demonstrated. Now the system is being used successfully for railway transportation across Russia, Ukraine, Slovakia, Poland, Byelorussia and a number of other countries. In my opinion, development and implementation of a universal consignment note is just the first step to harmonising the two legal systems. I am sure this target will be reached sooner or later. In 2006, the OSJD started to revise documents concerning SMGS and SMPS they took into account the current market relations and structural and organisational changes that took place on the railways of the OSJD member states.

How do we improve the competitiveness of railways?
- One of the main prerequisites for increasing the volume of transit transportation is an optimal tariff policy, which would satisfy all the participants in the transport process…
– This is a very complicated problem, but it must be nevertheless solved… A compromise should be reached. Otherwise everyone will lose. I’d like to discuss one aspect of this problem. Everyone knows that the transportation price includes the infrastructure cost, but its share is different for different transport modes. It amounts to 30-35% for railway, 5-10% for automobile transport, and 2-3% for sea transport. Obviously, the railway sector operates in worse conditions, while motorways, especially in Europe, are loaded with heavy vehicles carrying cargo. Traffic jams often appear and people suffer the resulting pollution. Meanwhile, the railway lines parallel to the motorways are underloaded. The situation is depressing. Is there any way out? We are convinced that railways and international rail organisations – such as the OSJD, the Intergovernmental Organisation for International Carriage by Rail (OTIF) and the UIC – should examine the situation and make a joint report for the governments of all the countries involved and that the UN should stimulate adoption of laws and arrangements envisaging re-direction of a part of the cargo flow from road to rail. It includes implementation of a special fee to be paid by owners of cargo road transport for using international motorways, a special tax system, and state grants.
It will make motorways safer and less loaded, improve the environment, and save money instead of spending it on building or widening motorways (one kilometre of motorway costs RUR 10-15 million). If a part of the cargo flow is redirected to railways, more regular block trains will be launched. Nowadays, 4-7 days are necessary to accumulate enough cargo for one route train. If there is enough cargo flow, several block trains could run daily. Naturally, the price for transportation would be lower. All these issues are connected with the problem of making railways more competitive.
– What is preventing the development of freight transportation, including container and contrailer use, between the Far East, China, and Europe?
– Analysis of transportation in the OSJD member states shows that cargo transportation volumes are growing every year, but not equally, and experts at the OSJD think that not all opportunities have been used. There are some barriers preventing international cargo transportation, i.e. border problems, flaws in infrastructure in some sectors of railway corridors, the existence of two legal systems regulating transportation, and unclear and unadjusted tariff policies. All these, among others, make railways less competitive. That is why a strategic target of the OSJD is to find a way, and then take measures to improve the competitiveness of railway transport. The OSJD member states have made a lot of progress: they have improved and modernised the infrastructure of all thirteen corridors of the OSJD, revised SMGS and SMPS agreements and taken measures to simplify border crossing procedures. Also, the Convention on international customs transit procedures for cargo transportation by railway using SMGS consignment has been approved. If the member states, including Russia, adopt and ratify it, border crossing procedures will take less time.

Don’t worry, be happy!
– Has the crisis influenced the results of railway transportation in the OSJD member states? 
– Recently we got a lot of reports that there was a decline in passenger and cargo transportation volumes on some railways. I cannot quote  specific figures because we will only receive the official transportation data for 2008 in September 2009. But, according to preliminary data, in February 2009, for example, the volume of cargo carried via the infrastructure of the Estonian railway dropped by 11% year-on-year.
In spite of the crisis, the transport figures for 2008 were positive in many OSJD member states. According to OAO RZD, in January-December 2008, 1.3 billion tons of cargo was loaded onto the Russian railway network, which is 97% of the volume loaded in 2007. Throughput grew by 5% to 2.42 trillion tariff tonne-kilometre. Also, it was the first year that the company’s revenue from core activities exceeded one trillion roubles. Loading of the most important public cargoes increased: coal (+3.8%), machines and equipment (+6.4%). Container transportation via the railways of Kazakhstan grew by 30-35% on average.
These and other data show that there are some difficulties, but they are not fatal. Owing to the flexible and reasonable policy of the railway administrations of the OSJD member states, we succeed in maintaining the level of total transportation volumes and continue to carry out our projects. For example, the prices for some services on international passenger trains in Russia, Belarus, Poland, China and other countries were fixed, and now they do not depend on the euro or dollar rate. This attracted passengers to railway transport and improved the competitiveness of railway passenger transportation in comparison with other transport modes, where prices depend on the currency rate. And high-speed railway construction projects are being carried out in Russia and China.
At the end of the interview, I would like to emphasise the importance of the coordinated work of all specialists in international railway transportation, targeted at development and further improvement of this important sector and better interaction between the railways of Europe and Asia. 
Sergey Kabenkov
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Interoperability is on the agenda
– Mr Shozda, what aspects of the organisation’s activity are priorities now?
– First of all, comes development and improvement of international railway transportation, especially between Europe and Asia, including piggy-backing. I should also mention creation of a coordinated transport policy in the sector of international railway transportation and development of the strategy for railways’ work and the OSJD’s activity. The improvement of international transport legislation is important too, including the Agreement on International Passenger Transportation (SMPS), the Agreement on International Goods Transport by Rail (SMGS), and other legal documents relating to international transportation by railway. We continue to pay special attention to cooperation targeted at solving problems in economic, information, scientific, technical, and ecological aspects of railway work as well as development of measures to improve the competitiveness of this transport mode. Also, we cooperate in the sector of exploitation of railways and technical issues concerning further development of international railway transportation. In addition, the OSJD interacts with international organisations working in the railway sector, including those specialising in piggy-backing.
– How does the OSJD cooperate with other railway organisations? 
– We actively cooperate with practically all international railway transport organisations on the territory of Eurasia. Together, we discuss the issues of border crossing, legal harmonisation of CIM/SMGS, including implementation and improvement of the unified consignment note CIM/SMGS, single digital coding and creation of a single database of railways, interoperability of railway systems, which have 1520 mm (1524 mm in Finland) and 1435 mm -- wide gauges; development of railway transportation on the territory of Eurasia. In cooperation with many of them we have created working groups to find solutions for all aspects of our activity.

Let the UN control the problem of border crossing!
– Is there any progress in reaching the target of simplifying border crossing procedures?
– There are almost 200 railway border crossings in the countries, which are members of the OSJD. Practically each one has its own peculiarities and problems. The OSJD, in cooperation with the International Union of Railways (UIC), has considered these issues for several years. As a result, a number of recommendations, measures, conclusions, and suggestions were made, and most of them have been implemented. Meanwhile, analysis shows that these measures are not enough, because railway organisations cannot solve some of the problems --those which are within the governments’ competence. That is why the Committee of the OSJD offered to discuss the problem under the aegis of the UN at an international conference devoted to simplifying border crossing procedures, in which representatives of governments, border and customs departments, and railway companies would participate. This initiative was supported. Drafts of the Annexe 9 to the Convention on cargo control at borders and a new Convention on passenger train control have been developed, as well as a plan for measures and some other documents. The target is to hold this conference successfully, and to attract the attention of the governments of the UN member states to the existing problems so as to solve them. I have to say that the OSJD has done a lot for the cause. For example, more than a decade we worked to develop the Convention on international customs transit procedure at cargo transportation by railway using SMGS consignment. Now the Convention is ready. We’d like the member states of the OSJD to ratify the document as soon as possible. Its application for international freight transportation would simplify the process of border crossing for transit cargo significantly.
– Could you tell us more about the problem with the two acting legal systems regulating cargo transportation: SMGS and COTIF?
– This issue is especially important for the liberalisation of export and import cargo flows. Two legal systems – SMGS and Convention concerning international carriage by rail (COTIF) – regulate international cargo transportation between East and West. Freight transportation using two legal documents creates a number of inconveniences for clients and transporters, since it requires obligatory re-issuing of transport documents when transferring from one system of transport legislation to another. Naturally, it leads to long-term delays in cargo delivery and additional expenses. Errors often appear when  documents are re-issued, which take a lot of time to resolve. For this reason, one of the major aspects of our work is development of a new universal consignment note meeting Uniform Rules concerning the Contract for International Carriage of Goods by Rail (CIM) as well as SMGS. This target could be reached only if specialists from the OSJD and the International Rail Transport Committee (CIT) cooperate closely. As a result of their work, a single universal consignment note CIM/SMGS and a manual were created. A pilot train loaded with ferrous metal ran from Ukraine to Germany in July 2006. Its weight was 1,120 tons. It crossed the border between Ukraine and Poland without transport documents being re-issued. Thus, the advantages of the new consignment note were demonstrated. Now the system is being used successfully for railway transportation across Russia, Ukraine, Slovakia, Poland, Byelorussia and a number of other countries. In my opinion, development and implementation of a universal consignment note is just the first step to harmonising the two legal systems. I am sure this target will be reached sooner or later. In 2006, the OSJD started to revise documents concerning SMGS and SMPS they took into account the current market relations and structural and organisational changes that took place on the railways of the OSJD member states.

How do we improve the competitiveness of railways?
- One of the main prerequisites for increasing the volume of transit transportation is an optimal tariff policy, which would satisfy all the participants in the transport process…
– This is a very complicated problem, but it must be nevertheless solved… A compromise should be reached. Otherwise everyone will lose. I’d like to discuss one aspect of this problem. Everyone knows that the transportation price includes the infrastructure cost, but its share is different for different transport modes. It amounts to 30-35% for railway, 5-10% for automobile transport, and 2-3% for sea transport. Obviously, the railway sector operates in worse conditions, while motorways, especially in Europe, are loaded with heavy vehicles carrying cargo. Traffic jams often appear and people suffer the resulting pollution. Meanwhile, the railway lines parallel to the motorways are underloaded. The situation is depressing. Is there any way out? We are convinced that railways and international rail organisations – such as the OSJD, the Intergovernmental Organisation for International Carriage by Rail (OTIF) and the UIC – should examine the situation and make a joint report for the governments of all the countries involved and that the UN should stimulate adoption of laws and arrangements envisaging re-direction of a part of the cargo flow from road to rail. It includes implementation of a special fee to be paid by owners of cargo road transport for using international motorways, a special tax system, and state grants.
It will make motorways safer and less loaded, improve the environment, and save money instead of spending it on building or widening motorways (one kilometre of motorway costs RUR 10-15 million). If a part of the cargo flow is redirected to railways, more regular block trains will be launched. Nowadays, 4-7 days are necessary to accumulate enough cargo for one route train. If there is enough cargo flow, several block trains could run daily. Naturally, the price for transportation would be lower. All these issues are connected with the problem of making railways more competitive.
– What is preventing the development of freight transportation, including container and contrailer use, between the Far East, China, and Europe?
– Analysis of transportation in the OSJD member states shows that cargo transportation volumes are growing every year, but not equally, and experts at the OSJD think that not all opportunities have been used. There are some barriers preventing international cargo transportation, i.e. border problems, flaws in infrastructure in some sectors of railway corridors, the existence of two legal systems regulating transportation, and unclear and unadjusted tariff policies. All these, among others, make railways less competitive. That is why a strategic target of the OSJD is to find a way, and then take measures to improve the competitiveness of railway transport. The OSJD member states have made a lot of progress: they have improved and modernised the infrastructure of all thirteen corridors of the OSJD, revised SMGS and SMPS agreements and taken measures to simplify border crossing procedures. Also, the Convention on international customs transit procedures for cargo transportation by railway using SMGS consignment has been approved. If the member states, including Russia, adopt and ratify it, border crossing procedures will take less time.

Don’t worry, be happy!
– Has the crisis influenced the results of railway transportation in the OSJD member states? 
– Recently we got a lot of reports that there was a decline in passenger and cargo transportation volumes on some railways. I cannot quote  specific figures because we will only receive the official transportation data for 2008 in September 2009. But, according to preliminary data, in February 2009, for example, the volume of cargo carried via the infrastructure of the Estonian railway dropped by 11% year-on-year.
In spite of the crisis, the transport figures for 2008 were positive in many OSJD member states. According to OAO RZD, in January-December 2008, 1.3 billion tons of cargo was loaded onto the Russian railway network, which is 97% of the volume loaded in 2007. Throughput grew by 5% to 2.42 trillion tariff tonne-kilometre. Also, it was the first year that the company’s revenue from core activities exceeded one trillion roubles. Loading of the most important public cargoes increased: coal (+3.8%), machines and equipment (+6.4%). Container transportation via the railways of Kazakhstan grew by 30-35% on average.
These and other data show that there are some difficulties, but they are not fatal. Owing to the flexible and reasonable policy of the railway administrations of the OSJD member states, we succeed in maintaining the level of total transportation volumes and continue to carry out our projects. For example, the prices for some services on international passenger trains in Russia, Belarus, Poland, China and other countries were fixed, and now they do not depend on the euro or dollar rate. This attracted passengers to railway transport and improved the competitiveness of railway passenger transportation in comparison with other transport modes, where prices depend on the currency rate. And high-speed railway construction projects are being carried out in Russia and China.
At the end of the interview, I would like to emphasise the importance of the coordinated work of all specialists in international railway transportation, targeted at development and further improvement of this important sector and better interaction between the railways of Europe and Asia. 
Sergey Kabenkov
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