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Locomotive Fleet Renewal Program

Russia Russia
Area Of Operation
Transport Infrastructure Transport Infrastructure

Quick Facts

Board Approval Date
16 December 2019
Current Limit of NDB Financing
USD 550 million (approx.)
Joint Stock Company Russian Railways
Implementing Agency
Joint Stock Company Russian Railways

More About This Project

With around 20,000 locomotives, Russian Railways (RZD) owns and operates almost all of the traction rolling stock in Russia. To meet the Company’s goals, which were approved by the Government of the Russian Federation, of increasing freight turnover (net of empty runs) in 2025 by 22% compared to 2018, locomotives will need to be replaced with new, more powerful and efficient models.

The Program’s objective is to replace around 20% of RZD’s fleet with new locomotives to (i) increase traction power over the network while enhancing the average daily productivity of each unit by around 10%; (ii) reduce transportation costs through lower consumption of energy and fuel, and reduced duration of idle time for maintenance; and therefore (iii) reduce locomotive greenhouse gas (GHG) emissions.

NDB seeks to finance part of RZD’s approx. USD 7.5 billion Program to acquire more than 3,500 new locomotives between 2019-2025.

RZD’s Program is one of the largest infrastructure projects currently under implementation in Russia. The Program will contribute to the following targets based on strategic documents which were approved by the Government of the Russian Federation: (i) an increase in freight turnover (net of empty runs) by 22%, (ii) a decrease in specific electric power and fuel consumption of railways by no less than 3% and 5% respectively, and (iii) reduction of RZD’s CO2 emissions by 4.5% in 2025 (all targets compared to 2018 level).

The Program has been categorized as Category B in line with NDB’s Environmental and Social Framework (ESF). The Program will have significant positive impacts on E&S aspects due to the replacement of old locomotives (which have completed their extended service life) by adding advanced, efficient and certified locomotives. Operation and maintenance of locomotives and facilities (such as depots, fueling stations), will have E&S risks, but these are mitigated by adherence to the country’s system and corporate management systems of RZD.

The total cost of the Project is estimated at approx. USD 7.5 billion. Financing sources are as follows:

Source of Fund Amount (USD million)
New Development Bank
550 (approx.)
Other financing sources of the Company
7,000 (approx.)

The Program started in 2019 and will span over 7 years with last deliveries of locomotives planned for 2025. Procurement will be carried out by RZD in accordance with its existing procurement procedures and applicable Russian legislation.

NDB Borrower
Eurasia Regional Centre

Tim Fleming