China to Finance 88% of Tehran-Mashhad Rail Project

China will finance 88% of the project to electrify a 926-km railroad between Tehran and the eastern city of Mashhad, Islamic Republic of Iran Railways’ deputy head, Maziar Yazdani, said. The financing contact, considered to be the first such deal after the removal of international nuclear sanctions against Iran, was signed in Tehran on July 26 between Exim Bank of China and Iran’s Bank of Industry and Mine. As per the agreement, China will extend a $1.5 billion loan for the project. Yazdani was quoted as saying by IRNA that Iran will have to come up with $200 million to fund the remainder of the project, which is to be carried out by China National Machinery Import and Export Corporation, otherwise known as CMC. Iran’s MAPNA Group is the main contractor of the project. Yazdani says 60% of the implementation of the project will be reliant on domestic capabilities. IRIR CEO Saeed Mohammadzadeh said the Tehran-Mashhad railroad will have the capacity to transport 25 million passengers and 10 million tons of cargo per year as soon as it is electrified. The project is estimated to take four years to complete.