Azerbaijan Railways Secures $131.5 Million Loan from ADB for Key Transport Corridor Rehabilitation

Photo: Social media

Azerbaijan Railways (ADY) has signed a $131.5 million loan agreement with the Asian Development Bank (ADB) to rehabilitate a critical section of the International North-South Transport Corridor (INSTC) in Azerbaijan. The agreement aims to enhance regional connectivity.

The loan agreement was signed by Rovshan Rustamov, Chairman of ADY, and Sunniya Durrani-Jamal, ADB’s Country Director for Azerbaijan, The Caspian Post reports, citing the agreement's text. 

The total project cost is estimated at $160.5 million, with the Azerbaijani government contributing $29 million.

The loan, provided under ADB’s flexible lending product, has a 22-year term, including a 2-year grace period, and will carry a determined interest rate. Repayments will be made semi-annually on May 15 and November 15.

The funding will support the rehabilitation of a 166-kilometer stretch of railway between Sumgayit and Yalama, including civil works and railway crossings. This loan is part of the Railway Sector Development Program, which ADB initially supported with $150 million in 2017. The additional financing will expand the project, aiming to complete the full rehabilitation of the 333-kilometer route by December 31, 2025.