Ensuring the sustainable functioning of railway transport by modernizing and developing the infrastructure of 1435 mm and 1520 mm standards, restoring damaged facilities and implementing technological solutions for the safety and continuity of transportation, as well as reconstructing stations to create a barrier-free environment
Transport Sector
Ensuring the sustainable functioning of railway transport by modernizing and developing the infrastructure of 1435 mm and 1520 mm standards, restoring damaged facilities and implementing technological solutions for the safety and continuity of transportation, as well as reconstructing stations to create a barrier-free environment
State level of SPP
100
General Information
Program Description
The program is aimed at the restoration, modernization and development of the railway infrastructure of Ukraine with a gauge of 1435 mm, as a key element of integration into the European transport system TEN-T, and a gauge of 1520 mm. The total operational length of the railway network of Ukraine is 19.8 thousand km, of which 45% is electrified.
A separate focus of the program — development of European gauge infrastructure (1435 mm) in the western region of Ukraine for the development of four main European TEN-T transport corridors on the territory of Ukraine.
The program also covers the reconstruction of stations taking into account barrier-free requirements, updating the rolling stock fleet, and creating a Traffic Management Center (TMC) for digitalization and centralization of transportation management.
The program also covers the direction of International Technical Assistance and Strategic Partnership for the Sustainability and Restoration of Railway Infrastructure - which is aimed at ensuring the sustainable functioning, technological renewal and adaptation of the railway infrastructure of Ukraine to European standards thanks to the support of international financial organizations.
Strategic Case
Program Goal
Strategic Relevance of the Program
Program Objectives
Number of stations where projects are being implemented to ensure barrier-free access and improve accessibility to railway infrastructure facilities for people with disabilities and other low-mobility population groups
0 units
8 units
Programme Sustainable Development Goals
Economic Case
Economic feasibility of the program
What are the main benefits expected from the implementation of the program for the economy, business, society, or individual industries?
Does the program objective provide for a contribution to the climate goal of mitigating the effects of climate change?
Does the program objective provide a contribution to the climate change adaptation objective: reducing the impact and/or reducing the vulnerability of an asset or population to one or more types of physical climate hazards?
Does the programme objective provide for a contribution to the climate objective of sustainable use and protection of water and marine resources?
Does the program objective provide for a contribution to the climate goal of transitioning to a circular economy?
Does the programme objective provide for a contribution to the climate objective of pollution prevention and control?
Does the program objective provide for a contribution to the climate goal of protecting and restoring biodiversity and ecosystems?
What social consequences are relevant for your program, after its implementation?
Why is it advisable to implement projects in the format of one comprehensive program, and not separately?
How will the program help strengthen other economic processes or reforms?
Program Components
Component ID
DREAM-004
Resource and technological support for the uninterrupted and safe functioning of railway transport infrastructure
Justification
The component is aimed at ensuring reliable operation of the railway infrastructure by updating critical technological systems, special equipment and mechanisms. It includes the purchase of modern track equipment, small mechanization equipment and special rolling stock of infrastructure facilities. It is expected to increase the efficiency of technical maintenance, reduce the time for eliminating emergency situations, reduce downtime and improve traffic safety. As a result of the implementation of the component, the fleet of equipment will be modernized, which will allow for effective performance of technical work. It also provides the possibility of remote monitoring of the infrastructure condition in real time. The social value of the component is to increase the stability and reliability of the functioning of railway transport, which is critical for population mobility, transportation of military cargo, humanitarian and commercial logistics. Economic benefits include reduced losses from delays, more efficient use of resources and reduced repair costs due to accident prevention. The component also contributes to improving working conditions for personnel and reducing the risks of occupational injuries. The alternative approach, in which technical upgrades are carried out piecemeal or “manually”, has already exhausted itself: it does not allow for scalability, unification and compliance with modern standards. The format of the program with a set of projects allows for centralized planning of procurement for all railway infrastructure facilities, coordination of technical requirements, avoidance of duplication and efficient use of funds. This is a basic component for supporting the continuous operation of the railway in the war and post-war period. Phased implementation in the program format allows for combining state resources with financing from international financial institutions and grant funds, ensuring flexible planning and quality control of works. Alternative approaches, such as local projects without overall coordination, do not allow for a systemic effect, the creation of uniform safety standards and proper integration of technologies across the entire network
Year
Amount
1
4'211'105'000 UAH
2
3'592'859'000 UAH
3
9'876'938'000 UAH
Component ID
DREAM-001
Restoration and modernization of the 1520 mm standard railway transport infrastructure
Justification
The component "Rehabilitation and modernization of the 1520 mm standard railway transport infrastructure" is aimed at improving the safety, reliability and efficiency of the national railway network. It provides for major repairs of tracks, modernization of switch points, contact network, traction substations, signaling, communication and dispatching control systems. As a result of implementation, it is expected to reduce the number of accidents and failures, reduce travel time, and reduce infrastructure maintenance costs. The component creates significant state value by ensuring the continuity of transport services in war and post-war reconstruction. The modernized infrastructure will contribute to the restoration of the population's access to basic social services, humanitarian aid and jobs. Thousands of jobs are expected to be created in the field of construction, repair and maintenance, which will have a positive impact on employment and the local economy. Due to the renovation of energy-efficient infrastructure elements, operating costs and CO₂ emissions will be reduced. Projects within the component will contribute to increasing the financial sustainability of JSC Ukrzaliznytsia, as well as improving its credit rating. Compared to alternative approaches — such as the implementation of individual projects or decentralized financing — the program format allows combining projects into a single logic, optimizing the sequence and effectively attracting financing. The program allows for consistent risk management, coordinating work across the country and ensuring consistency in recovery. This approach is consistent with the principles of public investment management, taking into account the principles of sustainable development, energy efficiency and social inclusion.
Year
Amount
1
7'657'911'000 UAH
2
21'646'553'000 UAH
3
23'363'862'000 UAH
Component ID
DREAM-006
International technical assistance and strategic partnerships for the resilience and rehabilitation of railway infrastructure
Justification
Year
Amount
1
1'760'262'000 UAH
Component ID
DREAM-005
Restoration of transport infrastructure
Justification
The "Transport Infrastructure Restoration" component provides for the comprehensive elimination of the consequences of the destruction caused to the railway network as a result of the armed aggression of the Russian Federation. It covers emergency and major restoration of tracks, bridges, stations, traction substations, contact network, traffic control facilities and station facilities. The main goal is to restore the safe and full-fledged functioning of critical transport routes that ensure population mobility, military logistics and economic stability of the regions as soon as possible. The expected result is the return of railway communication to deoccupied and frontline regions, as well as a reduction in the time for transporting people and goods. The restored infrastructure will allow the population to restore access to basic services, jobs and humanitarian aid. In the long term, this will contribute to the economic recovery of the territories, the return of internally displaced persons and the development of small businesses. The social value of the component lies in restoring the transport integrity of the state, ensuring national security and strengthening territorial cohesion. Economic benefits include preventing losses from isolation of territories, increasing transportation, supporting industry and stabilizing logistics on key corridors. Restoration also avoids the costs of alternative modes of transport, which are higher cost and less environmentally friendly. An alternative approach could have been to restore individual facilities in a targeted manner, but without a systematic vision and prioritization, this leads to inefficient use of resources. The format of the program with an agreed portfolio of projects allows for a rapid response to changing security situations, ensuring coordination with military administrations and international partners. This allows for a rapid start of work, mobilization of contractors and implementation of projects in an accelerated manner, in accordance with state policy priorities.
Year
Amount
1
1'579'562'000 UAH
2
1'053'041'000 UAH
3
3'839'329'000 UAH
Component ID
DREAM-002
Construction and development of 1435 mm standard railway transport infrastructure
Justification
The component “Construction and development of railway transport infrastructure of the 1435 mm standard” is a key element of Ukraine’s integration into the European TEN-T transport system. It is expected to significantly improve the throughput capacity of border crossings, reduce the time for cargo transshipment and border crossing. As a result of the implementation of the component, Ukraine will receive a direct connection with EU countries without changing wheel sets or cargo reloading, which will increase the efficiency of logistics. This will allow attracting new transit cargo flows, strengthening export opportunities, and intensifying trade. The component will also open access to fast international trains of the European standard for Ukrainian passengers. The construction of the 1435 mm gauge will stimulate the development of new multimodal terminals, logistics hubs, and industrial parks. The social value of the component lies in reducing Ukraine's transport isolation, accelerating European integration, diversifying logistics routes and creating thousands of jobs in border regions. Economic benefits are expected through increased freight volumes, reduced business costs for logistics and increased investment attractiveness of the regions. An alternative approach could be to maintain the existing transshipment model of 1520 mm - 1435 mm, but it does not provide sufficient speed or integration into TEN-T. It is the format of the program with a set of agreed projects that makes it possible to gradually implement infrastructure in different directions, synchronize work with donors (CEF, EIB, JICA) and ensure coordination with European partners. This is a strategic tool for transforming the railway from the post-Soviet model to the European one.
Year
Amount
1
2'155'327'000 UAH
2
4'472'013'000 UAH
3
6'170'668'000 UAH
Component ID
DREAM-003
Reconstruction of railway station complexes to ensure their accessibility for people with disabilities and other low-mobility population groups
Justification
The component aims to create a barrier-free environment at key railway stations in the country. Its implementation involves a comprehensive reconstruction of waiting rooms, ticket offices, platforms, crossings, bathrooms, entrance groups and navigation systems at stations, taking into account the needs of people with disabilities, the elderly, parents with children, veterans, and temporarily injured military personnel. The component plans to begin the reconstruction of at least 5 stations by 2028 with further scaling up to 8 in 2030. The expected changes include increasing comfort and safety for more than 15 million passengers each year, including about 1 million people with permanent or temporary mobility impairments. Elevators, ramps, tactile walkways, information boards, inclusive ticket offices and waiting areas will be installed. The component will also bring the facilities into line with the standards of the State Railways of Ukraine, the Association Agreement with the EU and the UN Sustainable Development Goals (SDGs 10, 11, 5). The social value is to ensure equal access to transport for all citizens, which is the basis of social cohesion. This also forms the image of Ukrzaliznytsia as a user-oriented service company. Economic benefits are achieved through increased passenger traffic, development of station services, and increased value of nearby real estate. An alternative could be a point-by-point adaptation of individual facilities, but it does not provide a standardization of the approach and is significantly more expensive in the long term. The format of the program allows for a systematic modernization of the station network, establishing standard solutions, optimizing procurement and ensuring quality control of implementation. This is an investment not only in infrastructure, but also in dignity, inclusiveness and social justice.
Year
Amount
1
92'400'000 UAH
2
1'636'800'000 UAH
3
1'957'200'000 UAH
Financial justification
Total estimated program cost
99'819'121'580 UAH
Estimated cost of program components
95'065'830'000 UAH
Component
Amount
Resource and technological support for the uninterrupted and safe functioning of railway transport infrastructure
17'680'902'000 UAH
Restoration and modernization of the 1520 mm standard railway transport infrastructure
52'668'326'000 UAH
International technical assistance and strategic partnerships for the resilience and rehabilitation of railway infrastructure
1'760'262'000 UAH
Restoration of transport infrastructure
6'471'932'000 UAH
Construction and development of 1435 mm standard railway transport infrastructure
12'798'008'000 UAH
Reconstruction of railway station complexes to ensure their accessibility for people with disabilities and other low-mobility population groups
3'686'400'000 UAH
Additional expenses related to program preparation and implementation
4'753'291'580 UAH
Training costs
Year
Amount
1
436'414'180 UAH
2
810'031'660 UAH
3
1'130'199'950 UAH
Implementation costs
Year
Amount
1
436'414'180 UAH
2
810'031'660 UAH
3
1'130'199'950 UAH
Cost justification
Short description
Justification documents
Sources and mechanisms of financial support for the implementation of programs.
Status
Funding mechanisms
Coverage, %
Investment
Non-repayable financing. Direct budget financing. Direct expenditures from the state budget (public procurement).
79%
Reimbursable financing (funded by produced goods). Private financing (equity and raised funds). Production-sharing agreements.
19%
Non-repayable financing. Grant financing from existing international support projects, international technical assistance programs, and grants. Direct expenditures.
2%
Justification documents
What potential funding sources can be mobilized on the basis of prior agreements or intentions to cooperate (if any)
After 2022, JSC Ukrzaliznytsia has launched active cooperation with international financial organizations and foreign partners to support the operation, restoration and development of railway transport. According to World Bank estimates (RDNA3 and RDNA4), the total needs of the transport sector for restoration are about 78 billion USD, of which more than 20 billion USD are for railway infrastructure. IFOs and governments of partner countries have already provided significant assistance: the European Investment Bank financed projects to modernize border railway crossings (€50 million), the French government - the supply of rails under a concessional loan, JICA - the supply of machinery and equipment, the EU and CEF - integration projects into the TEN-T network. Cooperation covers the development of border infrastructure, the purchase of special equipment, the modernization of traffic management systems, and increasing energy efficiency and sustainability of transportation. These areas of support allow not only to eliminate the consequences of destruction, but also to accelerate the European integration of Ukraine's railway system.
Management Case
Total program duration (months): 36
Approaches to project selection
Have approaches and criteria been defined for including public investment projects in the program, initiators of such projects, and their prioritization?
Organizational Measures
program implementation
32 months
selection of projects for implementation within the framework of the program
2 months
Program evaluation
1 months
Program development
1 months
Risk Assessment
Risk
Probability
Degree
Strategy
Risk
Lack of budget share of program financing
Probability
High
Degree
Critical
Strategy
Reduction
Risk
Lengthy approval and approval procedures during the implementation phase.
Probability
Medium
Degree
Considerable
Strategy
Reduction
Risk
High administrative burden and complexity of interagency interaction;
Probability
Medium
Degree
Considerable
Strategy
Reduction