Russia has extended the repayment deadline period for the loan for modernizing the Serbian railway until 2021. Russia and Serbia signed an agreement on an export loan worth USD 800 million for modernizing the Serbian railway in 2013 in Moscow.
It was reported at the time that the repayment deadline period was five years with an annual interest rate of 4.1%.
According to Moscow’s latest decision, Serbia should repay, by March 15, 2018, the fee of 1% on the undrawn amounts on the date of December 31, 2017. Furthermore, Serbia should pay the same fee on undrawn amounts on the date of December 31, 2021, by March 15, 2022.
In September, the Serbian Transport Ministry announced that authorities expect to reach an agreement with Russia on the deadline extension.
The proceeds from the loan were earmarked for the upgrade of railway sections of pan-European transport Corridor X in Serbia, as well as for the modernisation of the Belgrade-Bar track, the Beograd-Pancevo track and the construction of the Valjevo-Loznica section.
Under the agreement, RZD International implements modernisasion and rehabilitation works on Serbian railway network.
In October, RZD International started works on Serbian Vinarci – Djordjevo section the last one out of the three southern sections of the Corridor X. According to the schedule, the works are planned to be finished in the second quarter of 2017. The project cost exceeds USD 38 million and is financed from the Russian state export credit. Another project is the modernisation of Vranjska Banja-Ristovac rail section, that will be completed in the nearest future.
In December, the Russian company has finished the reconstruction of Bujanovac-Bukarevac railway section, one month ahead of schedule according to the contract. This is the first of the three sections of the Trans-European transport Corridor X, on Serbian territory.
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