Russian government allocates $300 million to building of exit road from Ufa

Russian government allocates $300 million to building of exit road from Ufa
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The government of the Russian Federation has decided on the allocation of federal budgetary funds to the construction of a new exit road from Ufa toward M-5 Ural federal highway.

The funds will be allocated within the framework of the state support for the project. As Interfax news agency reports on Tuesday, at present, a draft government decree has been prepared, according to which an agreement with the New Development Bank of the BRICS (the NBR) on the project financing is to be signed. The document has yet to be agreed by the relevant departments.

An estimated cost of the project under the name of “The Eastern Exit” is 34,5 billion rubles ($522 million), including 19,9 billion rubles ($300 million) planned to be allocated from the federal budget and 10 billion rubles of private investment ($151 million). The first tranche of the federal funding is scheduled for the 2018 year.

The agreement with the NBR provides for a loan of $68,812 million to Russia for a period of 10 years, with a floating interest rate based on a 6-month LIBOR or any other reference rate applied by the NBR. The loan will be repaid at the expense of the federal budget, with 12 equal payout ratio every six months. It is planned that in 2018, the NBR will provide $31,7 million, in 2020 — $22,4 million, and in 2021 — $14,7 million.

As a reference, The Eastern Exit is the largest investment and infrastructure project in the Russian Republic of Bashkiria implemented on the basis of the law on concession agreements. The concession term amounts to 25 years.