Apart from the delays, Serbia has also paid a heavy price with a number of design errors and a default on the Russian loan.

According to the findings of BIRN, Serbia paid compensation of around $ 30 million to its Russian partner due to errors made by the Serbian Institute of Transport, CIP, during the design of a viaduct and a tunnel in the village of Cortanovci, south-east of Novi Sad.

The state also paid a fine of more than $ 4.7 million after delaying the drawdown of a Russian loan tranche for the construction of the Stara Pazova-Novi Sad section.

The loan agreement was signed in January 2013, valid for five years. But since construction did not start within this timeframe, Serbia did not draw on the loan, resulting in a penalty paid to Russia in March 2018.

A 2016 protocol amended the loan agreement, which now expires at the end of this year, which is also the deadline set by the government for the completion of the Stara Pazova-Novi Sad section. It is not known if this deadline will be met.

Serbian Railways infrastructure told BIRN it was not aware of any penalties paid. The Ministry of Construction, Transport and Infrastructure has also not confirmed or reversed the payment of penalties.

But Zorana Mihajlovic, who headed the ministry between 2014 and 2020, confirmed BIRN’s findings.

“Unfortunately, after taking over the Ministry of Construction, Transport and Infrastructure, we realized that no specific project had been agreed under this loan, but the loan amount for the railway had been accepted in principle, “said Mihajlovic, now Serbian Minister of Mines. and energy.

Another reason for not using the loan on time, she said, was the fact that the work undertaken by the IPC did not correspond to the actual situation on the ground.

“The sanctions you are talking about derive from Article 2 of the Agreement between the Government of the Republic of Serbia and the Government of the Russian Federation on the Approval of the State Export Loan to the Government of the Republic of Serbia, which refers to all funds not used within five years, ie the amount of the loan initially agreed, ”Mihajlovic said in a written response.

Russian concerns over expropriation, permits