September 19 (SeeNews) - Serbia expects to reach an agreement with Russia next month on extending the deadline for the use of a $800 million (716.6 million euro) loan for state-owned railway operator Zeleznice Srbije, the transport ministry said on Monday.
The two countries' finance ministries will agree on the terms of the extension of the period prior to a visit to Belgrade by Russian prime minister Dmitry Medvedev scheduled for October, the transport ministry said in a statement following a meeting between minister Zorana Mihajlovic and a delegation of Russian Railways.
To date, Serbia has withdrawn some 40 to 45 percent of the loan total, local news agency Beta reported on Monday.
Serbia and Russia signed the five-year loan agreement in January 2013. The proceeds from the loan, which was extended at an interest rate of 4.1%, were earmarked for the upgrade of railway sections of pan-European transport Corridor X in Serbia, as well as for the modernisation of the Belgrade-Bar track, the Beograd-Pancevo track and the construction of the Valjevo-Loznica section.
According to the loan deal, Serbia should use all the proceeds from the loan by the end of 2017. However, it is estimated that the deadline is too tight and won't allow for the completion of the planned works, Beta said.
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