The Asian Development Bank (ADB) has approved a US$131.5 million loan that will help improve a key railway line in Azerbaijan for better regional connectivity.

The financing will complete the rehabilitation of about 166 kilometres of double-track main line, civil structures, and level crossings of the Sumgait–Yalama rail line. It serves as additional financing for the Railway Sector Development Programme approved in 2017, which is helping enhance railway operations in the country.

“Upgrading and modernizing rail service will enable Azerbaijan to provide safer, cheaper, and more energy-efficient transport,” says ADB director general for Central and West Asia Yevgeniy Zhukov. “At the same time, it will help Azerbaijan optimize its strategic location at the crossroads of Europe and Asia.”

The project is aligned with the transport strategy of the Central Asia Regional Economic Cooperation (Carec) Programme, which aims to contribute to regional economic development by improving rail and multimodal infrastructure and commercializing and reforming railway activities.

Under ADB’s Railway Sector Development Programme, Azerbaijan Railways (ADY) implemented comprehensive reforms in 2018-2019 that strengthened its financial capacity and railway management. Between 2018 and 2022, ADY’s freight transport grew by 34% from 14 million tonnes to 18.7 million tonnes. More than 80% of this is international or transit traffic.

The ADB is supporting Azerbaijan’s presidency of COP29, including via capacity building ahead of the landmark United Nations climate summit set to take place in Baku in November.