JSC Serbian Railways


Signed Contract on Russian Loan in the Amount of $800 Million for Serbian Railways Modernization

“Serbian Railways” Director General Dragoljub Simonović and “RŽD International” Director General Sergey Aleksejevič Pavlov signed today, on May 23, in Serbian Government $800 million worth Contract on Infrastructure Work Performance and DMUs procurement. The signing ceremony was also attended by President of Republic of Serbia Government Ivica Dačić, Minister of Transport Milutin Mrkonjić, President of Russian Railways Vladimir Ivanovich Jakunin and Russian Federation Ambassador in Serbia Aleksandar Vasilevich Chepurin.

-I would like to express great pleasure regarding signing the Contract between Russian Railways and Serbian Railways. That is the $800 million worth Contract. I will remind you that Serbian party participates with 15%, which means that the value of this venture will be higher than $900 million. For the procurement of DMUs $100 million will be used and the rest will be allocated for the modernization of railway lines in Serbia for various sections, above all for international Corridor 10 and on Belgrade- Bar section. At least half of the works will be performed by domestic companies. The Contract is not only indicator of good relationships between these two countries, but it is also highly important for development of our railways and entire Serbia- said Ivica Dačić, President of Republic of Serbia Government after the Contract signing.

– There are more and more talks on new revival of “Serbian Railways” among experts. From the point of view of European- Asian railway infrastructure development, the Contract is the first one which is signed within the scientific conception of expert teams. This occurred due to political will of the heads of our two countries and due to traditional relations of friendship and brotherhood of Serbian and Russian people- concluded President of Russian State Railways Vladimir Ivanovich Jakunin.
– The Contract which is signed today between “Serbian Railways” and enterprise of Russian Railways „RŽD International“ on realization of modernization projects, which will be financed from the Russian export loan in the amount of $800 million, is the biggest investment project of Serbian Railways in the past couple of decades. This venture today presents one of the most important development projects for Serbia and Serbian economy because great amount of our companies will be engaged on its realization, as it is defined by the Contract we have signed today. We are convinced that the most of these projects will be realized in the next five years and that Serbian Railways will become more efficient, more modern and with greater quality in the following period. The Contract is basic document for realization of entire venture and it defines all of its technical, financial, legal, business and other aspects, as well as dead lines, procedures and other elements of contractual relationship. In the following period we expect signing of five Annexes to the basic Contract, which will define each of projects which are comprised by the document which was signed today-, said “Serbian Railways” Director General Dragoljub Simonović regarding the Contract signing.
– This Contract includes five modernization projects for infrastructure and rolling stock of Serbian Railways, as follows: construction and electrification of second track on Pančevo bridge – Pančevo Main Station section, reconstruction of 112km on Corridor 10, reconstruction and construction of the second track on section of railway line Stara Pazova – Novi Sad, reconstruction of 200km of Belgrade – Bar line, and procurement of DMUs manufactured by „Metrovagonmaš“- said Mr. Simonović.


1.On main railway line Beograd Center – Pančevo Main-Vršac- State border with Romania, the second track will be constructed and electrified on section Pančevo bridge – Pančevo Main in the length of approx. 15km.

This project includes reconstruction of the existing track and infrastructure at the stations Krnjača, Ovča, Pančevo bridge, Krnjača bridge and Sebeš, including the bridge over Tamiš river, two stations, two station platforms, five new bridges, one passing point, freight substation Pančevo and marshalling yard Krnjača.
Estimated value of the works regarding the modernization of this section is approx. EUR 50 million and signing Annex to the Contract for this venture is expected in the second half of June this year. Works on modernization of Pančevo line could begin in September this year.

2. On Corridor 10 six sections will be reconstructed in the total length of 112km, and the estimated value of works is approx. EUR 29 million. The first section where works will start will be Ruma – Golubinci in the total length of 18km. Signing Annex to the Contract for this venture is expected in the second half of June, while works could begin in the last quarter this year.
Apart from Ruma – Golubinci section, in 2013 it is planed for reconstruction to begin of sections Sopot Kosmajski – Kovačevac (approx. 18, 4 km) and Mala Krsna – Velika Plana (approx. 29,5 km), while for the next year works are planed on sections Vinarci-Đorđevo (15 km), Vranjska Banja – Ristovac (17,7 km) and Bujanovac – Bukarevac (13,7 km).

Material worth EUR 25 million for planed reconstructions of railways on these sections will be procured from the loan of EBRD. On all of the above mentioned sections, due to condition of railway infrastructure, slow drives were introduced, so with their reconstruction faster and quality railway traffic on international Corridor 10 will be possible.
For the modernization of the Stara Pazova – Novi Sad about EUR 300 million will be invested, and it is planned that the entire project documentation should be finished by the first half of 2014 and after that, the realization of the work and the construction of line will begin, for speeds up to 160 km/h.

Technical part of the preliminary project is developed by the Transportation Institute CIP. IPA Fond donations for the development of the tender documents were used for the development of the Feasibility Study and assessment of environmental impact. Development of these projects was initiated by the Office for European Integration and the value of the grant is about EUR 3 million. These studies have not been completed because the approval of local government in Sremski Karlovci is yet expected, which had almost incredible demand for building a channel, which almost halted the entire project.

The average speed on Belgrade – Novi Sad – Subotica line is 71 km/h, but, due to the condition of infrastructure, on 7 spots, slow drives were introduced with speeds between 20 and 50 km/h. Trains in passenger operations have travel time between Belgrade and Novi Sad between 90 and 100 minutes, and last years, on this section, approx. 900 thousand passengers were transported. By modernization of this line, travel time between Belgrade and Novi Sad would be shortened to 40 minutes.

Stara Pazova – Subotica line is the first on the list of priorities for the railway transportation in the Master Plan for transportation infrastructure in Serbia 2010-2027 which was adopted by the National Council for Infrastructure.

4. For reconstruction of 200 km of railway line Belgrade-Bar through Serbia, EUR250 million will be invested, and in the following period the design is going to be developed.
5. And finally, for the procurement of new DMUs of Russian manufacturer „Metrovagonmaša“ $100 million will be allocated, and in the negotiations up until now, procurement of 27 sets was agreed upon.

Those are new DMU sets of the series 711, which are the same as 12 already bought and put into operation across Serbia from the loan of international railway bank EUROFIMA. On section where the new trains are put in regular passenger traffic, the number of transported passengers is increased for 25-50%, which in total amounts approx. 500 thousand in last 14 months. Those are the new trains manufactured according to European standards and with the modern equipment, which will replace old trains on non-electrified railway lines (2/3 of lines in Serbia is non-electrified).