Completed Development AidData Chinese Aid

China Eximbank provides RMB 191.9 million government concessional loan for Upgrade of the Vahdat-Yavan Section of the Dushanbe-Kurgantube Railway Project (Linked to Record ID#71443)

¥191.9M RMB

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Tajikistan Ministry of Finance
Country	Tajikistan
Start Date	Nov 07, 2014
End Date	Sep 19, 2033
Duration	6,891 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`40489`

Grant Description

China Eximbank provides RMB 191.9 million government concessional loan for Upgrade of the Vahdat-Yavan Section of the Dushanbe-Kurgantube Railway Project On November 7, 2014, the Ministry of Finance of the Republic of Tajikistan signed two loan agreements [CHINA EXIMBANK GCL NO. (2014) 30 TOTAL NO. (533) and CHINA EXIMBANK PBC NO. (2014) 40 TOTAL NO. (334)] worth $68,992,970 with the Export-Import Bank of China (China Eximbank) for the Upgrade of the Vahdat-Yavan Section of the Dushanbe-Kurgantube Railway Project: an RMB 191.9 million government concessional loan (GCL) provided on highly concessional terms (a 20-year maturity, an 11-year grace period, 1.5% interest rate, a 0.2% commitment fee, and a 0.2% management fee) and a $36.9 million preferential buyer’s credit (PBC) on highly concessional terms (a 2% interest rate, a 20-year maturity, 9-year grace period, a 0.2% commitment fee, and a 0.2% management fee).

The loan agreements were ratified by the Tajik Parliament on January 14, 2015.

The Government of Tajikistan then on-lent the proceeds of the PBC and GCL to Tajikistan Railway (Rohi Ohani Tojikiston or Роҳи оҳани Тоҷикистон) through a set of on-lending agreements [No. TAJ 2014 ROT-029 (1) and No. TAJ 2014 ROT-029 (2)] that were signed on January 16, 2015.

Tajikistan Railway was expected to use the loan proceeds to finance a $59,993,900 commercial contract that it signed with China Railway 19th Bureau Group Co Ltd on August 13, 2013. Record ID#40489 records the GCL and Record ID#71443 records the PBC.

The project involved the construction of construction of 5 bridges and 3 tunnels along the Vakhdat-Yavan section of the Dushanbe-Kurgantube railway.

It was to become the first railway project launched and completed under the framework of the "Silk Road Economic Belt" initiative, and was to become a hub of an international railway network connecting China, Tajikistan, Afghanistan, and Iran. China Railway 19th Bureau Group Co Ltd was the contractor responsible for project implementation.

Construction began on May 15, 2015 and the project was completed on August 24, 2016.

However, according to a 2021 CAREC assessment, '[c]ompletion of the Vakhdat–Yovon Railway in 2016 does not seem to have attracted the additional traffic expected.' There are also signs that the China Eximbank PBC and GCL which were contracted to finance the Upgrade of the Vahdat-Yavan Section of the Dushanbe-Kurgantube Railway Project financially underperformed vis-a-vis the original expectations of the lender.

In 2021, Tajikistan's Ministry of Finance was instructed to make a $25 million repayment (including penalty interest fees) to China Eximbank because Tajikistan Railway was unable to meet its repayment obligations.

📋 Staff Comments

The Russian project title is Строительство железной дороги Душанбе-Курган-тюбе, участок Вахдат- Яван.
Yavan is also spelled Yovon. Vahdat is also spelled Vakhdat.
The face value of the loan is identified by Tajikistan's Ministry of Finance via http://minfin.tj/downloads/ochet%20vnesh%20dolg_2014.pdf4. The loan identification numbers are identified via http://portali-huquqi.tj/publicadliya/view_qonunhoview.php?showdetail=&asosi_id=245545. The preferential loan framework agreement that governs the GCL agreement can be accessed via http://www.portali-huquqi.tj/publicadliya/view_qonunhoview.php?showdetail=&asosi_id=16733 and https://www.dropbox.com/scl/fi/bgjsvs6hfgwdvhy9zsyy0/FRAMEWORK-AGREEMENT-between-the-Government-of-the-People-s-Republic-of-China-and-the-Government-of-the-Republic-of-Tajikistan-on-the-provision-by-the-People-s-Republic-of-China-of-a-preferential-loan-to-the-Republic-of-Tajikistan-2014.pdf?rlkey=uvemo61dkidu3ip0234zdxuf7&dl=0

📚 Sources & References

Eximbank to finance construction of Vahdat-Javan railway
Building of Dushanbe-Kurgan-Tube railway line get $51-million loan
China expected to provide loan to Tajikistan for construction of Vahdat-Yovon railway
Tajik parliament ratifies loan agreement with China Exim Bank
CAREC Dushanbe-Kurgantube Railway Vahdat-Yavan Section (Construction)
Construction of bridges and tunnels on Dushanbe-Kurgantube railway
Vakhdat-Yavan section
Construction of bridges and tunnels on Dushanbe-Kurgantube railway
Vakhdat-Yavan section
Information about the current state investment projects
Belt and Road Initiative increases sovereign debt risks in Tajikistan
Following Up
List of Chinese Government-Financed Projects in Tajikistan from the Ministry of Finance via the IMF May 2018, Отчет о состоянии государственного долга на 2014 год, Отчет о состоянии государственного долга на 2015 год, Парламент Таджикистана сегодня рассмотрит ратификацию ряда кредитных соглашений с КНР Подробнее, Китайские компании помогают Таджикистану улучшить транспортную инфраструктуру
Chinese-built Tajikistan railway starts operation, РАМОЧНОЕ СОГЛАШЕНИЕ между Правительством Китайской Народной Республики и Правительством Республики Таджикистан о предоставлении Китайской Народной Республикой Республике Таджикистан льготного кредита, Китай выделяет более $500 млн на проекты в Таджикистане Читать далее
CAREC Corridor Implementation Progress
Planned Actions, and Support Needs TAJIKISTAN, Строительство мостов и тоннелей на железной дороги Душанбе-Кургантюбе, участок Вахдат-Яван
Construction of bridges and tunnels on the Dushanbe-Kurgantyube railway
Vahdat-Yavan section, Постановление Правительства Республики Таджикистан от 28 августа 2013 года, № 373 'О Контракте между Государственным унитарным предприятием 'Роіи оіани Тоїикистон' и Китайской компанией 'China Raliway 19th Bureau group Co Ltd' пo изысканию, проектированию и строительству тоннелей и мостов новой железной дороги Душанбе-Курган-тюбе, участок Вахдат-Яван'
Inauguration connects Tajik rail networks
RAILWAY SECTOR ASSESSMENT FOR TAJIKISTAN MARCH 2021, Вазорати молия бояд қарзи ширкати Роҳи оҳани Тоҷикистонро бипардозад, О государственной финансовой поддержке государственного унитарного предприятия 'Рохи охани Точикистон', d000003634 Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.

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Tajikistan Ministry of Finance

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