High-Speed Rail Line Sees Costs Double

Rail Baltica, the high-speed rail project aimed at integrating the Baltic States with the European rail network, is now projected to cost €15.3 billion, nearly double the initial estimates.

The Context

Vladimir Putin's invasion of Ukraine has heightened the Baltics States' desire to reduce dependency on Russian infrastructure and energy supplies.

Rail Baltica is designed to enhance connectivity between Estonia, Latvia and Lithuania, and Poland. Initially estimated to cost about €7 billion, the project has faced geopolitical tensions, complex engineering requirements and inflationary pressures.

The goal is to complete a standard-gauge railway line that can support high-speed passenger and freight trains, thereby boosting economic integration and resilience in the Baltic region. Historically, the Baltic countries relied on railway systems that use the Russian gauge, which is a remnant of their time under the Soviet influence. Rail Baltica will adopt the European standard gauge.

What We Know

According to a recent update from Eng.Lsm.lv, the cost of Rail Baltica has surged from €7 billion to €15.3 billion.

Newsweek has reached out to a representative of Rail Baltica via email for comment.

This revised estimate was announced amidst the commencement of major construction activities in Latvia, where the ERB Rail joint venture, including companies like Budimex and Eiffage, has begun building crucial segments of the railway​.

The project's scope includes the construction of 175 engineering structures, such as wildlife crossings, viaducts, and bridges, over a 230 km stretch. These enhancements are essential to meet the project's ambitious goals of reducing travel times and increasing freight capacity across the region. The new railway will enable passenger trains to travel at speeds up to 240 km/h and freight trains at 120 km/h, significantly improving transit efficiency​ according to the World Construction Network.

The increased costs are partly attributed to the complexities of constructing in diverse terrains and the need to ensure compliance with stringent European Union standards. Additionally, geopolitical tensions have necessitated more robust security and infrastructure resilience measures, further driving up costs​, according to the World Construction Network.

What's Next

Despite the escalating costs, the Rail Baltica project continues to move forward. The Rail Baltica project is Co-financed by the Connecting Europe Facility of the European Union, as per the Rail Baltica website.

The Rail Baltica is expected to create 36,000 jobs, as per their website. In a post on X, formerly known as Twitter the Rail Baltica account declared that "Rail Baltica is economically #viable & expected to generate an economic net present value of 6.6 billion EUR in direct net benefits."

The project is expected to be a game-changer for the region, enhancing economic growth, social cohesion, and environmental sustainability by shifting freight transport from road to rail​.

Users have been responding to the news of the increased cost of the Rail Baltica online. One user wrote in a post on X, "The construction of the SRS building, a symbol of corruption, cost 30 million. Rail Baltica's increase in price by creating an additional 40 railway stations. We divide 20 billion by 40. We get 500 million for each station! These are insane amounts of theft! Just insane!"

Another user expressed a similar sentiment, writing on X, "the government and the public found out too late that the Rail Baltica project will cost so much."

The project is slated for completion by 2026, with full operational capacity expected shortly thereafter.

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