Russia rail and road investment could spur economy

Subject

Russia's rail and road infrastructure.

Significance

As the world's largest country, Russia faces unique challenges in developing its transport infrastructure. Fiscal constraints since 2014-15 have prevented the necessary investment, and the continuing deterioration in connectivity between regions hampers economic activity and amplifies existing social problems.

Impacts

• Investing in transit corridors should strengthen Russia's position in the global supply chain.
• The two-year delay to the Moscow-Kazan high-speed railway demonstrates the difficulties of qualitative improvements.
• Underdeveloped urban and inter-city transport systems impede labour mobility and productivity.
• Initiatives to transfer road maintenance costs to final users will meet with resistance against 'taxing' a public good.