RIGA, July 16 (Xinhua) -- The Latvian government on Tuesday approved the financing necessary for the purchase of new electric passenger trains for the state-owned rail company Pasazieru Vilciens, the Transport Ministry informed.
The allocation also includes money for building a train maintenance and repairs center, the ministry said.
The purchase agreement has yet to be signed, and the Finance Ministry warned of possible difficulties with raising co-funding from the European Union.
According to the decision taken by ministers at Tuesday's cabinet sitting, the government financing has been reduced by 3 million euros from the amount earmarked for the train purchase in November 2018 to 256 million euros. The financing has been made available to Pasazieru Vilciens from 2019 to 2024.
After a lengthy procurement procedure, the contract to supply the 32 new electric passenger trains to Pasazieru Vilciens and to train Latvian mechanics has been awarded to the Czech train maker Skoda Vagonka.
Representatives of the Transport Ministry indicated that the allocation of government financing means Pasazieru Vilciens can go ahead with signing the contract with Skoda Vagonka. The contract is expected to be closed by the end of July 2019.
Skoda Vagonka has offered to supply the trains to Pasazieru Vilciens for 242 million euros.
In November 2018, the Latvian government earmarked 259 million euros for the purchase of the new passenger trains, their spare parts and maintenance equipment, as well as construction of a new railway depot.
