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Aug 21, 2017 11:21
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The Company


Structural Reform Programme

The Government of the Russian Federation approved a Structural Reform Programme for Railway Transport on 18 May 2001.

The objectives of the reform were to:

  • increase the reliability, accessibility and the safety of rail transport and the quality of its services in order to ensure the country's unified economic space and nationwide economic development;
  • establish a unified harmonised transport system for the country;
  • reduce the total national economic costs for the carriage of goods by rail;
  • meet the growing demand for rail transport services.

The Structural Reform Programme initially included three phases, all of which were completed in 2010. The results were approved by the Russian government and international experts.

First of all, within the framework of the reform, a sectoral regulatory framework was developed. The adoption of the Laws on Rail Transport in the Russian Federation, the Railway Transport Charter of the Russian Federation and other regulatory acts enabled economic activities to be divided into separate functions of government regulation and management and the creation of a single economic entity in 2003 - namely the Open Joint-Stock Company (OJSC) Russian Railways.

One of the main goals and results of the industry reform was to establish conditions for the development of competition in rail transport.

The following potentially competitive and competitive activities in various areas were spun off from the structure of Russian Railways:

  • operating freight cars,
  • long-distance and commuter/suburban passenger transportation,
  • wagon and carriage repair work and major locomotive repairs,
  • construction and design,
  • industrial production,
  • scientific and design work,
  • trade and public catering,
  • the provision of sanatoria and spa services, etc.

During the reform, a total of 85 subsidiaries and affiliated companies of Russian Railways were established.

The creation of these entities as subsidiaries enabled them to:

  • develop their own development plan for each competitive market segment,
  • improve their financial and economic efficiency,
  • attract the interest of outside investors to the business and to attract private investment.

In accordance with the decisions of the Government of the Russian Federation, it was necessary to achieve the further development of competitive relations on the transport market and establish additional sources of investment for the development of the railway infrastructure.

To realise this strategy, shares in established subsidiaries and affiliated companies were sold over the course of several years.

As a result, Russian Railways received over 285 billion roubles for the implementation of the investment programme.


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