Iran-Armenia or the Armenian “Nabucco”

Watch for high-level meeting on the case of the Nabucco gas pipeline, with the loud statements about the geopolitical significance of the project, which to this day does not become a reality, but remained level applications. “Nabucco” – this is a pipe dream of Europe. It is economically unprofitable and too politicized: not enough gas (assumed from Central Asia and Azerbaijan through Turkey to Europe to carry at least 30 billion cubic meters of gas, while Azerbaijan has so many do not, and Turkmenistan, and Uzbekistan sell its gas to Russia) No finance for its construction (more than 8 billion euros of investments), there is no demand (as a member of the Nabucco real interest and participation in the project of “Gazprom” “South Stream” (South Stream)), etc.
The same project is a railroad Iran-Armenia, which has almost the same problems: finance, obstacles to construction, questionable support from Iran, a lack of interest of the Russian railways, and contrary to the interests of Moscow once again mention the geopolitical significance – as stated by Prime Minister Tigran Sarkisyan, “Iran-Armenia is able to change the geopolitics of the region, and National Security Council Secretary Artur Baghdasaryan stated that” this road will also enable the transport system of Armenia through Iran to establish a connection with the Middle East and China.”

Indeed, the railroad, if it is built, has the ability to spread not only in East and South but also in North and West directions. For Armenia, it can become a strategic, given that Armenia with the outside world has a railway connection only through Georgia, and the reliability of the Georgian territory in question. In fact, the new railway should become an alternative method for transportation of energy resources in Armenia and other goods, as well as the Nabucco gas pipeline, which should deliver gas to Europe from Central Asia and Azerbaijan to bypass Russia.

However, despite the marked positive aspects, the question arises: how realistic is the rail project?

April 14, 2009 during a two-day visit of President Serzh Sargsyan to Iran, Minister of Transport and Communications Gurgen Sargsyan and Minister of Transport of Iran Hamid Behbahani signed a memorandum on the construction of the railway, which was a logical continuation of a meeting in Yerevan on March 3. It was announced that the project consists of three phases – feasibility studies, design of the railway, and in fact construction.

But until now the project is not found on any of the stages of implementation, although constantly refers to its strategic significance and importance.

The government plans to begin preparing a document of a feasibility study for the construction of Iran-Armenia. However, no mention of how long it takes for the preparation of this document.

Considering options for the construction of roads 443 km, 449 km and 397 km. it was noted that the most suitable for the Armenian side is a third option, assuming the route Gagarin Ghawar-Martuni-Jermuk. Iranian railway section will be about 60 kilometers.
Based on the number of calculations, we assume that the railroad could take 4-5 years. And depending on the option chosen, the railway project is estimated at 1.5 – 2 billion dollars.

Neither knowing the exact extent of any nor the exact amount, however Armenia is the railway project to various international funds and countries, hoping for a concrete support in the implementation of not just a specific project.

China is considered one of the possible sources of “specific support”. Back in 2008 the chairman of the National Assembly Hovik Abrahamyan was discussing with the Chinese side the issue of railway construction, and, according to official sources, the project aroused their interest.

It is believed that Iran probably would have “a concrete support.” He announced his readiness to give credit to Armenia and $ 400 million to finance construction of the railway on its territory, but only when construction would begin.

Iranians (not excluded, and other interested parties) may think, why build a railroad, if Nagorno-Karabakh conflict can be solved in the future that will lead to the reopening of the railway Nakhijevan-Yeraskh. In this case the Iranian railways can contact the Nakhichevan (and each state has  strategic and long-term priorities).

It is possible that the Russian side will provide support, which is considered by many to be the most required for the project of Iran-Armenia. The authors’ such opinions are likely to come from the following.

In 2007, the Armenian government has announced a tender for thirty years of modernization and renewal of railways in Armenia. Indian RITES did not pass the competition, and February 13, 2008 “Russian Railways” company took over management of the concession of Armenian Railways. They created the company “South Caucasus Railways” with the right extension for 20 years after the first twenty years of work.

However, it should be noted that the concession contract for the concessionaire (the “South Caucasus Railways”) does not create a financial commitment to invest in railway construction. In other words, the Russian side belongs only to the movable part of the railroad – wagons, etc., but no infrastructure – an area the railway line, etc. So, the Russian is not required to finance the construction of the railway infrastructure of Iran-Armenia. Iran-Armenia has nothing to do with the “South Caucasus Railways”: this is an interstate project.

“Russian Railways said that can take non-financial participation in the construction of the railway. CEO Vladimir Yanukin stated that they are willing to finance the project, explaining what it means consulting and other participation.

On the other hand, Russian announced their readiness to finance the construction of railway, connecting Russia with Iran via Azerbaijan. This project is more realistic because it implies investments totaling $ 400 million, with most of the money already invested, and it remains to finish the only certain areas. And it was recently announced that Iran and Russia have prepared all the necessary technical and economic programs for the construction of the road that will connect the northern city of Rasht, Iran through Azerbaijan to Moscow.

Through the railway project Qazvin-Rasht-Astara Russia is trying once again to bypass and isolate America’s ally Georgia. The same logic of subjects and a gas pipeline “South Stream”, which was mentioned above. He, unlike the Atlantic, “Nabucco”, implies the need to deliver gas to Europe from Uzbekistan (the Black Sea to Bulgaria to Italy and Austria through Greece to Sardinia and through Serbia and Hungary to Austria).

And if the Iran-Armenia will be built, it will connect with the railway, Armenia, Georgia, which is clearly not a consequence of Russia’s interests.
It should be noted that the implementation of railway Russia-Azerbaijan-Iran logically calls into question the already questionable Iran’s readiness to support the draft of the Iran-Armenia.

Despite the fact that the railway project of Iran-Armenia faces many obstacles, as mentioned above, despite the lack of realism and the uncertainty of construction, the Armenian authorities to believe (or claim to believe) that the railway construction will begin soon.

Back in 2008, October 2 at an extraordinary session of parliament in his speech, referring to the MPs and the people President Serzh Sargsyan announced that the priority projects that are the focus of government: a new nuclear plant in Metsamor, the construction of Iran-Armenia and the creation of Armenian Bank.

“If not this, then next year we will begin construction of Iran-Armenia” – the president said in his first inaugural speech.