Domestic Economy

Tehran, Moscow Eye Joint Projects Worth $40b

Tehran, Moscow Eye Joint Projects Worth $40bTehran, Moscow Eye Joint Projects Worth $40b

Russia and Iran plan to invest up to $40 billion in joint mid-term projects, Russian Energy Minister Alexander Novak said in an interview with Russia’s Rossiya-24 television channel on Friday.

“In my view, from all of the agreements and discussions from my visit, we have moved on to some sort of a list of projects with an overall value of around $35 billion to $40 billion. This is obviously not for one year, but for a certain mid-term period of time because there are some projects that are long-term,” quoted him as saying.

Novak made the statements after a two-day visit to Iran (Oct. 21-22) aimed at exploring investment opportunities and grounds for cooperation. He met with top Iranian officials, including Minister of Communications and Information Technology Mahmoud Vaezi, Minister of Roads and Urban Development Abbas Akhoundi and Oil Minister Bijan Namdar Zanganeh.

In his Wednesday meeting with Vaezi, the Russian minister said Russia is mulling over a $5 billion credit line to help finance infrastructure projects in Iran.  

According to Novak, who is also a co-chairman of the Russian-Iranian intergovernmental commission, bilateral trade worth $1.68 billion registered in 2014 does not reflect the potential of the two economies.

“I do not agree that we are late in entering the Iranian market. We started this work much earlier than other countries and in the last two years, we managed to achieve a lot. Our economic and trade cooperation historically developed on the principles of friendship and good neighborly relations; today we are at a new stage. Iran is our important strategic partner," Novak said.

Among the main directions of cooperation between Russia and Iran, Novak singled out joint projects in mining, thermal power plants, supply of Russian equipment and technology in such sectors as communications, space, transport, including maritime and construction of rail infrastructure, and ways of financing joint projects, which in particular includes the creation of a joint Russian-Iranian bank, reported.

> MoU on Infrastructure Development

On Thursday, the Russian energy minister signed a memorandum of understanding with Vaezi on development of joint infrastructure projects and the two sides pledged to improve relations in different sectors of transport, oil, roads and urban development and banking.

According to Akhoundi, 121 transport projects worth €25 billion were introduced to the Russians, IRNA reported.

“The Russians have expressed willingness to invest in Iranian projects. To begin our joint projects, we are ready to hand over the $1.2-billion project of electrifying Garmsar-Incheh Borun railroad to the Russians. This would open a new chapter in trade relations between the two countries,” he added.

Garmsar-Incheh Borun railroad connects north-central Iran to the northeastern border with Turkmenistan.

Novak's two-day visit came in the wake of a July 14 agreement between Iran and major world powers, including Russia. He led a 40-strong delegation of Russian companies in the oil, gas, petrochemical, power plant and railroad industries, including the state-owned Gazprom and Zarubezhneft, the country's largest independent natural gas producer Novatek, Bashneft, Russia's fourth largest oil producer Gazprom Neft, exploration services company Rosgeo, engineering firm Technopromexport and the state-run Russian Railways.