Pro-market organizational reforms
The current Russian Railways (RZD) forms a holding company in the form of a joint-stock company, which is the result of the structural reform of the railways in the Russian Federation carried out since 2001. The basic principle of the reform was to separate the natural monopoly activities of the railways, i.e., infrastructure management, from the sphere where competition is possible, as well as to attract private investment into market segments of the railway industry. Furthermore, provisions were made to stop cross-subsidization of railway activities, increase flexibility in tariff regulations, increase the industry’s investment potential, and improve the transparency of the entire railway business. These actions were taken in the first stage of reforming RZD in the years 2001 – 2002.
As a result of the reorganization measures taken in 2003, part of the sectoral ministry (MPS) units were transformed into the “Russian Railways” joint-stock company with 100% state ownership. The mission of this company is to: ensure the implementation of railway transport reform, create a competitive, efficient business, satisfy market demand for transport, improve the quality of services, and achieve fuller integration with the Eurasian transport system.
The main goals of the RZD company are to ensure the fulfillment of the needs of the state, legal entities, and individuals in the field of rail transport, the provision of additional services in the transport market, as well as the achievement of profit. This activity is carried out by 17 regional branches of the company located throughout the country, including the Kaliningrad Railway with its headquarters in Kaliningrad, the Northern Railway with its branch headquarters in Yaroslavl, and the Far Eastern Railway with its headquarters in Khabarovsk. During the second stage of the RZD company reform, which lasted until 2005, 27 subsidiaries were created in the field of production and repair of road equipment, production of railway automation and telemechanics equipment, construction and design-research work, freight wagon repair, container transport, and others. The effect of this stage is an increase in the level of competition in the freight transport market and the shaping of the size of the entire RZD holding. The third stage of reforming the RZD railways began in 2006 and will last until 2010. As a result of this reform, participants in the rail transport services market – in addition to the RZD company and its subsidiaries – will also include other companies, both private and state-owned, performing passenger transport, providing rolling stock, repairing rolling stock and infrastructure, terminal and logistics services, as well as other services provided to passengers. A further increase in the number of privately owned line locomotives is also expected. Since the beginning of the implementation of the Russian railway structural reform program, decisions have been made to create 55 subsidiaries and dependent companies.
In 2008, an important event for the further development of rail transport in Russia took place, namely on June 17, the government of the Russian Federation adopted decree No. 877-r, which approved the “Strategy for the development of rail transport in the Russian Federation until 2020”. The positive progress of the rail transport reform has been confirmed by many opinions, including those of the Council of Ministers of the RF, the Federal Assembly of Russia, as well as experts from the Organization for Economic Cooperation and Development (OECD) and other foreign specialists.
Eurasian transport corridors
In the territory of the Russian Federation – in accordance with the findings of the II and III European Transport Ministers’ Conferences (Crete 1994, Helsinki 1997) – pan-European transport corridors were defined, whose railway mainlines should meet the standards indicated in the European Agreement on Main International Railway Lines (AGC) and in the European Agreement on Important International Combined Transport Lines and Related Installations (AGTC). A transport corridor is a sequence of transport infrastructure of international importance, along which various transport routes with appropriate technical parameters run (for example, a motorway and a railway line with increased technical parameters with transport hubs located on them (for example, logistics centers).
The routes of these corridors, which run along the RZD company’s railway lines in various geographical directions, are as follows:
1) in a latitudinal layout:
– corridor II – Berlin – Warsaw – Minsk – Krasnoye (RZD) – Moscow – Nizhny Novgorod, connected to the Trans-Siberian Railway (Transsib), up to Vladivostok,
2) in a meridional layout:
– corridor I A – Riga – Sovetsk (RZD) – Kaliningrad – Mamonovo (RZD) – Gdansk,
– corridor IX – Helsinki – Buslovskaya (RZD) – St. Petersburg – Moscow – Suzemka (RZD) / Pskov (RZD) – Kiev – Lyubashevka – Chisinau – Bucharest and further to Greece,
– corridor IX B – Kiev – Minsk – Vilnius – Kaunas – Nesterov (RZD) – Kaliningrad.
These corridors, however, did not take into account the geopolitical and economic interests of many Asian countries, including China, Kazakhstan, and the Russian Federation, whose territory is located on the great Eurasian continent. In 1996, after an analysis of cargo flows between the countries of Europe and Asia, the Organization for Cooperation of Railways (OSJD) defined the main directions (corridors) of rail transport in the area of OSJD member countries, taking into account, among other things, the routes of pan-European transport corridors and materials developed by the UN ESCAP commission. A similar directional division of these corridors was also adopted.
The article comes from the “Logistyka” magazine 1/2010.