China Railway Group Ltd. (00390.HK) has been hired to design a high-speed railway between the Russian cities of Moscow and Kazan, The Wall Street Journal reported.
It is one of the first concrete examples of the new business with China that Russian officials have been pursuing amid a cold shoulder from the West over Russia’s role in the Ukrainian conflict.
A unit of Russia’s state-owned JSC Russian Railways signed a contract last week with China Railway Eryuan Engineering Group, the design unit of the state-controlled Chinese firm, to come up with the plans for a 770 kilometer high-speed railway.
The Chinese firm will work with two Russian companies on the designs for a total cost of 20.8 billion rubles (US$383 million) over the next two years, Russian Railways said.
Once the designs are developed, a separate tender will be held for the construction of the rail link, which Russian Railways expects to cost 1.06 trillion rubles.
It is “likely” China’s rail developers will land that massive contract as well, but it isn’t guaranteed, the Russian firm’s president, Vladimir Yakunin, was quoted as saying.
Zhu Ying, president of Eryuan Engineering, said the design contract “means a lot” to a Chinese rail industry looking to expand globally, Xinhua reported.
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