The government is considering cancelling construction of the high-speed railway between Moscow and St. Petersburg.
One alternative being considered is the replacement of the high-speed railway for selected cargo between the two cities. This option is lobbied by Russian Railways.
The plans to build a high-speed railway between Moscow and St. Petersburg were announced last August. The project was included in the federal budget for 2022-2024. Completion of construction work was expected in 2027.
PSR Analysis: The most obvious reason for uncertainty of a mega-project like this, is a shortage in the budget. However, the Russian budget now is healthy and has a growing surplus. So, the Russian government may be considering a scenario where this money is required somewhere else. If this assumption is correct, it’s a crisis scenario. PSR
Maxim Sakov is Market Consultant-Russia Operations for Power Systems Research
