Russia Abandons North Siberian Railway Project Amid Soaring Costs and Funding Cuts

Kremlin Halts Ambitious Railway Project

The Russian government has officially abandoned plans to construct the ambitious North Siberian Railway (SevSib) project. Deputy Prime Minister Vitaly Savelyev reportedly informed President Vladimir Putin of the decision in a letter, citing the project's prohibitive cost as the primary reason for its unfeasibility.

The SevSib railway was envisioned as a vital transport artery, designed to facilitate coal exports and enhance connectivity with the Northern Sea Route (NSR). However, its estimated construction cost of 50 trillion rubles (approximately $644 billion USD) proved too high, largely due to the challenging terrain and permafrost conditions in Siberia.

Financial Constraints and Economic Headwinds

The decision to halt the SevSib project comes amidst significant financial pressures on Russia's infrastructure development. The investment program for Russian Railways (RZD) has seen substantial cuts, with projected investments not exceeding 1 trillion rubles in 2026, a sharp decline from 1.49 trillion rubles in 2024. This reduction reflects broader economic struggles within the Russian Federation, exacerbated by ongoing geopolitical circumstances and international sanctions.

The high cost of the project, coupled with the reduced investment capacity of RZD, made the continuation of SevSib unsustainable. Experts have noted that the current economic environment makes it unlikely for such large-scale work to commence in the near future.

The Vision of SevSib: Purpose and Planned Route

The North Siberian Railway was intended to serve several strategic purposes:

• Redistribute load on Russia's eastern railway network.
• Connect the Trans-Siberian Railway to the Northern Sea Route.
• Create an additional transport corridor for coal exports from regions like Kemerovo and other parts of Siberia.
• Establish a new gateway to China.

One proposed route for SevSib spanned approximately 2,000 kilometers, linking Nizhnevartovsk, Bely Yar, and Ust-Ilimsk. Another component considered was a section from Tashtagol to Urumqi in China, which would have required the construction of tunnels through the Altai Mountains. The project was initially included in Russian development strategies as early as 2008 and 2009, with design work slated for 2016 before being postponed. Russia reportedly revisited the project in August 2024.

The planned railway was projected to handle an estimated 115 million tons of freight per year, with coal accounting for approximately 50 million tons of that volume.

Implications for Northern Sea Route Development

The abandonment of SevSib is expected to have significant implications for the development of the Northern Sea Route's (NSR) transport infrastructure. Experts suggest that without this railway, it will be challenging to attract a substantial portion of freight, particularly from coal-rich regions such as Kemerovo, Khakassia, and the Urals, to the NSR.

This setback is not isolated, as other major railway projects linked to the NSR have also faced delays. The Northern Latitudinal Railway (NLR), for instance, has seen its construction postponed until 2027-2031 due to funding shortages.