Terms of WB loan for road project in Azerbaijan announced

The Azerbaijani government will start repaying a loan of the International Bank for Reconstruction and Development, a member of the World Bank Group, for the Regional Roads and Development project from October 15, 2025.

Report informs, citing the loan agreement signed on October 26, 2021, the interest rate on the loan until October 2031 will be 7.14%, and payments on the loan will be made at a rate of 7.18% from April 2032. The principal debt on the loan will be repaid twice a year - on April 15 and October 15.

In May 2021, the WB Board of Directors approved the provision of the loan to Azerbaijan in the amount of $65 million for the implementation of a new road project. The total cost of the Salyan-Bilasuvar road reconstruction project is $95.88 million.

The loan is provided for a period of 11 years with a 4-year grace period. Completion of the project is scheduled for March 31, 2026.

The funds will be used to rebuild the existing Salyan-Bilasuvar road in accordance with the second technical category, which is an alternative road to Alat-Astara - the state border with Iran, as well as to improve the efficiency of roads and their safety, the quality of new road services, to create a roadside logistics management model and market infrastructure and other technical assistance.

The Regional Roads and Development project will provide safe, efficient, and climate-resilient transport links and improve market access for the population along the Salyan-Bilasuvar road in the south of the country. Some 250,000 people along this route will benefit from improved road infrastructure, as well as improved economic opportunities and easier access to key service facilities.

The project will finance three key areas. First, investments in roads and ancillary agricultural and logistics infrastructure will help maintain connectivity and market access to maximize the impact of upgraded roads on socio-economic development.

Second, the project will support financial sustainability and efficiency in the road sector through technical assistance in developing road network management systems and exploring options for imposing user charges and preventing vehicle overload.

Third, the project will support the design and organization of roadside logistics and market facilities, as well as training local entrepreneurs to improve income opportunities for local communities.

Let us recall that Azerbaijan joined the World Bank in 1992. Since then, the WB has funded more than 50 projects totaling $4.4 billion.