Moscow: Russia has opened its first container terminal on the Caspian Sea, a cargo hub that will boost Russia's trade with India and other countries linked by North-South transport corridor.

The terminal, which has an initial annual capacity of 500,000 metric tonnes is located near Astrakhan in the seaport town of Olya and is part of an ambitious agreement Russia signed with India and Iran three years ago. The agreement aims to develop a fast-track transport corridor beginning in India's Okha port in Gujarat, and extending to North and West Europe via Iran and Russia.

Shipping goods to Europe via Olya would take Indian companies 15 to 23 days and is 40 percent cheaper than shipping via the Suez Canal, the traditional route, which takes between 35 to 40 days.

According to sources, Russia is already shipping some heavy equipment through this corridor for Kudankulam nuclear power station under construction in Tamil Nadu.

Last month Belarus and Kazakhstan also joined the project. According to the Russian Transport Ministry Tajikistan, Armenia, Syria and Oman are also close to joining the project.

In 2005, Olya is expected to handle 4 million tonnes of cargo, and the volume is expected to double to 8 million tonnes in 2010.

Once the strategic link is completed, Russia, India and Iran will be able to double the volume of goods they ship to Europe, ITAR-TASS reported.

However, without a rail link to the national railway network, the port's capacity is limited to receiving goods by truck only. Once it is integrated with the national rail system, the terminal's capacity is set to skyrocket.

According to President of Russian Railways Corp. Fadeyev, the 50 km track to connect it with the Astrakhan-Grozny trunk line would be fully operational by September 2004.

The rail link is expected to cost some $100 million and will be financed by the newly formed Russian Railways Corporation, and the European Bank for Reconstruction and Development.

PTI