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President of Russia Vladimir Putin: Mr Yakunin, we know that traffic volumes are a primary indicator of the state of the economy in general. In this connection, I’d like to hear from you about the rail traffic situation and traffic volumes over the first half of this year, and then we can also discuss the company’s investment programmes and financial situation. Please, go ahead. 

Russian Railways CEO Vladimir Yakunin: Mr President, the situation is not the simplest at the moment. You spoke yourself about the economic difficulties Europe is facing, and the effect this has had on Russia’s export sectors. As a transport company, we began to feel these effects back in November. 

What we see today is that the negative trend is still in place. So far this year, we are down by 3.6 percent compared to last year. But there are some positive developments too. We expect higher volumes for the July-August period, even though we are carrying out infrastructure repair work at the same time, and by the end of the year we hope to make up for the losses we suffered over the first half of 2013, and should end up with a result for the year only slightly less than that for 2012.

Overall, the company is within its planned targets as far as revenue goes, but the results are lower for actual traffic volumes. At the same time however, rail traffic to the Far East ports continues to increase. You gave absolutely correct figures at the last meeting, when you noted that freight volumes heading for the Far East ports are now 8–10 times higher than they were in 1988, the most effective year during the Soviet period. This confirms the need to develop the Baikal-Amur and Trans-Siberian railways.

The company was forced to take stringent measures to cut its costs. We have cut our costs by 81 billion rubles [around $2.5 billion]. Part of this is postponed expenses, because there are things that we need to do, but we realise that at the moment we simply do not have the resources.

Of course, 81 billion is a huge sum, but this has not affected our investment programme. The programme is still being implemented in full accordance with the decisions that you and the Government took. We are set to buy a record number of engines this year, new ones, and we will carry out this programme in full. 

We do have difficulties in the social sector of course, but, as always, we are carrying out all of our obligations under the collective labour agreement, and the sector workers feel the results. We are being particularly attentive to the situation in the Far East and Siberia now. Despite the transformations underway, all decisions on job cuts here are the sole prerogative of the company management. Every person working in this region is extremely valuable to us. That sums up the results for the first half of the year. 

As for what we are doing by way of innovation in the broader sense, as we promised, we are putting the first double-decker carriages into operation this year. The advantage of these carriages is that we can maintain and even increase comfort levels and speed, while straight away cutting ticket costs by 30 percent. We need to develop new passenger service methods, because the state policy for encouraging population mobility and the support going to the air transport sector obliges us in the railways sector to develop new ways of working too. This includes high-speed rail links, express routes, and these double-decker carriages, for example. 

This year, we will also complete in full our obligations regarding Olympic facility construction. The railway station in Adler, where you placed a capsule in the foundations, will open for traffic in October. I’d like to invite you to attend the station’s opening.

This is an ultra-modern railway station. It will get 30 percent of its energy needs from solar power. The same thing goes for water supply: rain water will be collected and used for technical needs and for watering the lawns.

Overall, the sector is operating in stable fashion, but work is going ahead very intensively at the same time. Everyone is working very hard now.

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